Know Your Competitive Advantage

Know Your Competitive Advantage: The Experts Focus on it; Most Businesses Miss It

Warren Buffet was asked, “What is the single most important thing you look for when you invest in a company?” He replied without hesitation, “Competitive advantage.”  His practice was never to invest in a business that did not have a competitive advantage and a strong management team.  Jack Welch, CEO of G. E. back when it was a strong company, said, “If you don’t have a competitive advantage, don’t compete.”  This focus provided tremendous results for these two geniuses of yesterday, and the empires they built.

Yet as I travel around for speaking, both nationally and internationally, to business leaders of all size companies, I always ask,” How often do you review/consider/evaluate your company’s competitive advantage?”  Remarkably, the two most common honest answers are “never” and “once a year.”  How often do you consider that question for your AMC?  and your client associations?

Competitive advantages should be reviewed/considered/evaluated frequently – we recommend at least quarterly - if you want your organization to be better differentiated in the marketplace.  Because there is such a large gap between how often we should be evaluating competitive advantages in our organizations and how often we do, organizations are leaving money on the table every day.

Have you been able articulate the value you bring to your associations?  Is the value consistently delivered?  If not, it may be a big mistake.  If you don’t value what you do for your customer, they won’t value it either.  If you are not yet focused on metrics that are relevant to your customers’ values, you may be painting yourself into commodity corner, allowing price to be the differentiator.   You must be able to build confidence and reduce risk in the sales encounter by demonstrating your past performance in the most critical customer areas.  For example, it is likely you have good metrics for membership growth and retention, but do you track networking opportunities that turned into business for members?    

My company spent the last 20 years doing research for 350+ organizations of all sizes, and multiple industries from startups to Fortune 100.  We learned via double-blind research what their own customers valued in their buying decision.  We then compared the values of their own customers and prospects to the company’s view of what mattered most.

The findings are both startling and, I might add, a bit frightening:

  • 95% of businesses did not know their customers’ top buying criteria.
  • 85% of those businesses did not internally measure what mattered most to the folks making buying decisions.
  • 70% of the time, customers valued different buying criteria from prospects, yet most companies were using the same sales/marketing message for both.

The gap between what is most important and what organizations think is important is why I can state unequivocally that most businesses are leaving money on the table. Every organization we have worked with had unleveraged competitive advantages, which, when finally presented, closed more deals.

The common buzz word of the last decade has been “disruption.”  Uber, Amazon, various apps and technologies, etc., have disrupted the world as we once knew it.  The pandemic has been a significant disrupter to many businesses, and thus to their associations.  Hospitality has also suffered greatly.   Warning:  it is time for businesses to get focused on and embrace the disruption in how they sell a value proposition.  Your value proposition is not an internally made-up declaration, such as, “we will have staff dedicated to your association’s needs.” It is much more than a cliché in today’s environment.

Whether you are the AMC for a handful of associations, or dozens, your capacity to answer, “why us?” depends on your ability to provide competitive advantages that are most relevant to the organizations you seek to run.  And, your client associations must be able to answer “why us?”  for the members they hope to attract.

The good news is that is it is very likely you have some good competitive advantages that, at the moment, are best kept secrets.

In the good old days of G.E., Jack Welch said, “When the rate of change outside an organization is greater than the change inside, the end is near…"   Our attention spans are not what they once were either.  And that applies to our clients and prospects as well.   We must adapt our messaging to solid, succinct, and relevant deliverables to close more sales and protect margins.

Share this post:

Comments on "Know Your Competitive Advantage"

Comments 0-5 of 0

Please login to comment