Competitive Advantages

Marketing; Lecturer: Mr. Silih A Wasesa


Competitive Advantage

advantage from a lower cost structure: an advantage enjoyed by a company with lower costs than a rival, enabling it to sell for less or make greater profits at the same price as its rival.

Keuntungan yang di nikmati oleh sebuah perusahaan yang dimana perusahaan mengeluarkan cost yang lebih rendah daripada rivalnya, yang dapat membuat rival kalah dalam penjualan (market share) atau membuat keuntungan lebih dengan harga yang sama dengan rival.

Encarta

A competitive advantage exists when the firm is able to deliver the same benefits as competitors but at a lower cost (cost advantage), or deliver benefits that exceed those of competing products (differentiation advantage). Thus, a competitive advantage enables the firm to create superior value for its customers and superior profits for itself.

Cost and differentiation advantages are known as positional advantages since they describe the firm's position in the industry as a leader in either cost or differentiation.

A resource-based view emphasizes that a firm utilizes its resources and capabilities to create a competitive advantage that ultimately results in superior value creation. The following diagram combines the resource-based and positioning views to illustrate the concept of competitive advantage:

A Model of Competitive Advantage

Resources and Capabilities

According to the resource-based view, in order to develop a competitive advantage the firm must have resources and capabilities that are superior to those of its competitors. Without this superiority, the competitors simply could replicate what the firm was doing and any advantage quickly would disappear.

Resources are the firm-specific assets useful for creating a cost or differentiation advantage and that few competitors can acquire easily. The following are some examples of such resources:

* Patents and trademarks
* Proprietary know-how
* Installed customer base
* Reputation of the firm
* Brand equity

Capabilities refer to the firm's ability to utilize its resources effectively. An example of a capability is the ability to bring a product to market faster than competitors. Such capabilities are embedded in the routines of the organization and are not easily documented as procedures and thus are difficult for competitors to replicate.

The firm's resources and capabilities together form its distinctive competencies. These competencies enable innovation, efficiency, quality, and customer responsiveness, all of which can be leveraged to create a cost advantage or a differentiation advantage.


Cost Advantage and Differentiation Advantage

Competitive advantage is created by using resources and capabilities to achieve either a lower cost structure or a differentiated product. A firm positions itself in its industry through its choice of low cost or differentiation. This decision is a central component of the firm's competitive strategy.

Another important decision is how broad or narrow a market segment to target. Porter formed a matrix using cost advantage, differentiation advantage, and a broad or narrow focus to identify a set of generic strategies that the firm can pursue to create and sustain a competitive advantage.

Value Creation

The firm creates value by performing a series of activities that Porter identified as the value chain. In addition to the firm's own value-creating activities, the firm operates in a value system of vertical activities including those of upstream suppliers and downstream channel members.

To achieve a competitive advantage, the firm must perform one or more value creating activities in a way that creates more overall value than do competitors. Superior value is created through lower costs or superior benefits to the consumer (differentiation).

Sources: QuickMBA.com ; Encarta ; Indoskripsi.com

The example


Kecap ABC vs Kecap BANGO

Selama ini pasar kecap banyak didominasi oleh pemain pemain lokal maupun nasional, seperti kecap cap Bango dari Unilever, kecap ABC produksi Heinz ABC, dan kecap Indofood, dan baru-baru ini Wingsfood juga meluncurkan kecap yang bermerk Sedaap, yang merupakan strategi pemasaran dengan metode awareness pada produk sebelumnya yang pernah meng-gebrak market Indonesia (Mie Sedaap).

Sebagai contoh untuk competitive advantage, Kecap Manis cap Bango dengan rivalnya Kecap manis ABC. Kecap manis ABC lebih dulu in di Indonesia dibandingkan Kecap Bango yang masuk pada tahun 2001. Ketika Bango masuk ke Indonesia, ternyata yang terjadi adalah Konsumen menyambut produk tersebut dengan hangat, dan market share dari Kecap Bango mulai bertambah, bahkan hingga 2 kali lipat. Berdasarkan Indeks Loyalitas Konsumen Indonesia (Kategori Kecap) tahun 2005 dan 2006, ternyata Kecap Bango sudah menduduki peringkat loyalitas konsumen di atas ABC Heinz.

Ditinjau dari segi produk, kecap Bango lebih memposisikan sebagai kecap yang berkualitas tinggi dengan pengolahan yang khusus. Dimana bahan-bahan yang digunakan juga menggunakan bahan alami dan terpilih (pure and selected). Dari segi rasa kecap manis itu sendiri, Kecap Bango menggunakan yellow soy bean, yang menciptakan cita rasa kecap manis yang pas bagi orang Indonesia.

Maka secara garis besar dapat disimpulkan Kecap Bango dapat memberikan benefit yang lebih kepada konsumen dari pada ABC-Heinz. Baik dari kualitas dan positioning making, Bango secara langsung memberikan pengaruh terhadap decision making dalam memilih kecap.