Building Your Competitive Edge: The Difference Between Competitive Advantage and Competitive Necessity
Understanding your company’s competitive advantage and how to strategically leverage it to reach your target audience is a critical step for success. So, if we were to ask every team member about what your company’s competitive advantage is, would their answers align? What if we were to ask your target audience the same? Would your perception of your unique value align with what is communicated in the market and to your team? Understanding your competitive advantage, but more than that, building alignment and messaging around your competitive advantage is the key to ensuring that your customers understand your unique value in the market, and that your team members also understand how to strategically communicate that value to consumers. So, let’s start with first identifying your competitive advantage, and differentiating it from your competitive necessities. You might already have a few ideas that come to mind when you think of your competitive advantage..but, oftentimes, those initial qualities that come to mind when identifying your company value are actually competitive necessities, not your competitive advantages. Understanding the difference between your advantages verses your competitive necessities is the first step in better leveraging your competitive edge for growth and for standing out amongst competitors.
Competitive necessity describes all of the qualities that allow your company to survive in your market. Your company’s competitive advantage, on the other hand, refers to the unique value which allows your company to outperform competitors. Let’s use an example to dive into this idea a bit more. Let’s say that your industry market is a track race. In this example, your competitive necessities are the qualifications that allow you to sign up for the race in the first place, while your competitive advantage is the unique running technique that boosts you ahead in your race against the competition! Example aside, your competitive advantage is what makes your company unique—your differentiating value to consumers, and integrating this unique value into your messaging ensures that your company is aligned and achieves growth.
How Do You Identify Your Competitive Advantage vs Competitive Necessities?
Let’s walk through a specific example that will help you better differentiate your company’s competitive advantage from your competitive necessities, and ensure you have the tools to leverage your competitive edge! Let’s say, for example, that your company offers healthcare services. Using this example, let’s identify the competitive advantage and competitive necessities of this healthcare practice…
Example of Competitive Necessities in Healthcare:
A competitive necessity in the healthcare industry, for example, might be that your practice employs board-certified doctors and licensed nurses. While this is an important quality of your practice that allows you to compete in your market, it’s not unique to only your company. When a patient decides whether they will choose your practice over another, they might find this quality valuable, but it won’t persuade them to choose your specific practice over your competitors, in fact, it’s likely something that they expect or assume you already have or do. Shaping your company messaging around your competitive advantage (rather than your competitive necessities) will ensure that your target consumers, or in this example, potential new patients, choose your company because of the unique differentiators you offer in the market!
Example of Competitive Advantages in Healthcare:
Now, that we’ve discussed some examples of competitive necessities, let’s discuss how to identify your competitive advantage, so you can begin leveraging it in your market strategy for growth. Let’s say, for example, that in addition to offering healthcare services, your company is unique in that it also integrates traditional medicine with holistic practices, a quality that is unique to your company in the market…DING DING DING! That’s your unique value—your competitive edge! Leveraging your competitive edge in your messaging will ensure that your target audience understand what makes your practice unique—why they should choose your company over another, and why your company offers an experience that your competitors can not.
Need help identifying your competitive advantage? Download Our *Free* Competitive Advantage Questionnaire!
Now that you’ve identified your competitive advantage (using our free guide to walk you through it!), it’s important to integrate this value into your marketing strategy to ensure that you’re communicating your competitive advantage in a way that will reach and speak to your target audience. Integrating your competitive advantage into your mission, messaging, and marketing strategy is when your competitive advantage transforms into an asset for growth! So, let’s talk strategy…
How do you incorporate your competitive advantage into your strategy to leverage it for growth?
Up-to-date Marketing Materials: Center your marketing materials around your unique value proposition (your competitive advantage), so that the focal point of your marketing materials for all potential clients centers around WHY patients should choose your practice over your competitors. While it is important for clients to know that you also offer all of the competitive necessities needed to survive in your market, it’s more important that clients understand your unique value, first and foremost. They can of course learn more about your competitive necessities as they explore your business, but when it comes to drawing them in—focus your message around your unique to your unique competitive edge! Speak to that competitive advantage.
Team Alignment: Align your entire team—yes, the entire team—from the operations staff to accounting, everyone needs to be clear on your unique value proposition, as well as your company strategy for communicating that competitive advantage to potential patients, consumers, and clients! Center your communication strategy around the tone, voice, and personality that best speaks to your specific audience, driving your messing with your competitive advantage at the forefront.
Value Customer Feedback: In order to strengthen your competitive advantage, it’s important to understand any potential disconnect between what you believe the value of your company in your market is, and what your consumers perceive it to be. If you find that these two perspectives are unaligned, use this feedback to strategize how you can refine your competitive advantage to meet consumer demand specifically in the communication style that speaks to them!
When your company can successfully identify the unique value that you bring to the market, and even further, can integrate it into your marketing strategy and messaging in a way that resonates with your customers, you’re leveraging your competitive advantage for growth! Competitive advantages and competitive necessities are both crucial for a successful business. Competitive necessities are important for keeping your company afloat, but your competitive advantage is what ensures your company stands out. Centering your team and your messaging around these advantages will catalyze your success, foster customer loyalty, and create unique brand recognition in your market.