Can you tell me how you're different from every other business in the same industry in your area?
Hi Friend,
Let me ask you a question:
Can you tell me how you're different from every other business in the same industry in your area?
Friend, If you don't know the answer to this simple question
Then there's nothing to be ashamed of.
Not a lot of business owners know their competitive advantage.
But over the following two emails, I want to change that.
At least for you.
In the 80s, Harvard Business School Professor Michael Porter developed the four key competitive strategies.
And I want to share two of them with you today.
Let's begin.
1 - Cost Leadership
This is all about two things:
We are offering the lowest cost at the highest volume.
Using this strategy means you'll be focusing on offering everything you can to everybody at the lowest price.
Some examples of companies that use this competitive strategy are Walmart and Costco.
They've got a lot of franchise models that are offering as much volume as they possibly can.
It's because they want to be able to capture as many people as possible.
Hence, they appeal to a broad audience.
2 - Cost Focus
This strategy is pretty much like cost leadership.
Although instead of intending to target a mass audience, this means focusing on a single niche market.
This is where you're trying to compete in a specific niche market, but you're still doing this based on cost.
I can't think of any brands that use this strategy because they aren't as memorable in this space.
But if you think of a car repair mechanic and they're buying supplies from a particular brand.
And they're looking for the lowest price on that specific part.
They may be using the cost-focus strategy.
After all, auto repair shops are a niche industry, but they're also competing at the lowest possible price.
So smaller market, smaller price.
These are just two critical competitive strategies businesses use to distinguish themselves from their competitors.
I promise to complete the set in my following email.
In the meantime, if you need help with any of the concepts discussed today