Building your competitive advantage in good times and bad

“What is competitive advantage, and how do you build it?” asks Callum Budd, Research Projects Director at MRA Research.

It’s easy to spot the effects of competitive advantage on a company’s growth. It’s hard to identify it beforehand though, and harder to build it into your business. It’s extremely hard to sustain it. Tesla is losing it. Apple still has it in spades.

In the industry, Screwfix, Selco, MKM, and Huws Gray obviously have it.

But what is competitive advantage and crucially, can it be identified, measured and developed?
Yes, it can. It’s improving the things that matter to customers, and making sure that the improvements you make stick. And then, are customers seeing the effects you wanted? Is their customer experience materially better? It’s dynamic too. Economies, markets, and competition change, so you need to keep fine tuning your competitive advantage to keep it sharp.

In today’s markets it’s not enough to take customers’ temperature every year or so. To make a difference you need to match the planned improvement cycle to the speed of market change: measure what customers think, review, implement the improvements and measure again. And continue doing that.

It can take two to three cycles of measure, review, implement, and measure again to see the effects and build momentum. Measured annually, improvements, if sustained, will spread over three to four years. In that time markets can change significantly, so it’s harder to sustain and build momentum. Measure quarterly and you can build quicker. Measure monthly and you can build a powerful momentum much faster.

Who knows what needs improving? Customers. Their needs are not fixed, and they change as the market changes, just like you. How do you find out? Ask them in a professional way.
Good marketing helps businesses grow. Good research tells marketing what to improve to help them grow.