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  • Subject area(s): Marketing
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  • Published on: 14th September 2019
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Consumers prefer to choose online retailer due to its reliability, comfortability and an effective customer service.  E-commerce experienced have give the business a more competitive advantage compares to those who don't. Due to a wide variety of selection of product provided online have to give consumer more option to choose. Along with technological advancement, the effective relationship among customer has met a high volume of a satisfied consumer. With constant online communication which they call as the virtual community now a day, it  gives innovator an idea to create or produce products based on what consumer wants and can attract more customers. With great marketing strategies towards competitive advantage, this can create excellent customer service satisfaction that leads to a more sustainable competitive advantage. Online shopping's are more convenient, more options to choose and it is indeed comparable. According to Internet World Stats 2016, there's about 46.4 percent around the world are using the internet. And so, marketing and selling your business  product online is a tricky, risky and it can be rewarding. Competitive advantage strategies are important for the success of the business. And it is important that organisations sustain the above strategies for product improvement and to fights the competitions. So what is a Competitive advantage? How can Online Business sustain the high competition in the 21st century? And how to identify customer needs? This paper aims to understand how to sell and market your product using Competitor Analysis and how to sustain competitive advantage.

Creating close relationship with customer to gain competitive advantage

To gain valued customer it is true that knowing and providing what they want can create a loyal customer and will increase numbers of a potential customer. But it is also important that adding value to your product can gain a more profitable outcome. It is best to anticipate not only providing customer needs but also business need to be diligent in doing research and keeping your business in the loop. Providing excessive customer expectation can increase loyal customer when they are satisfied with product or services offered. This will create a more competitive advantage against the rival. Kotler defined Competitive Advantage as “An advantage over competitors gained by offering consumers greater value than competitors do”. Kotler also states that having good marketing strategies can add value to the customer. Why? It is because marketer makes your company look attractive to consumers and religiously studying competitors analysis will give you a heads up to find their weaknesses and to know your company strengths.

Competitive Analysis

Kohler suggested that to create a competitive advantage organisation must know their opponents. This is an important aspect of the business that used to determine competitors strengths and weaknesses. It is important that business used this strategy to know and gain a competitive advantage against the competition. With this strategies, it can help an organisation to investigate competitors. You need to know who will be in your market competition and it is product information when running a business. This product information includes prices, specification, their promotions, who's their connection and how they market its product.  For example, you owned the Alibaba, you the need to know who's competing against you. This online/wholesale business are competing against customer satisfaction and the wide variety of product offered which connected with competitive strategies. Alibaba competes against eBay, Amazon, etc. As Alibaba needed to know each competitor to look out how they work, what's their strength and what lies ahead? Using SWOT analysis, this then can determine their strength, know their weaknesses, what is it that threaten your business to change it and lastly create an opportunity that will give your business to build up an increase profitable growth. This competitors analysis it will help business to innovate something that has not offered by competitors. With this strategy, it can help marketing personnel to make an effective marketing plan (Kotler 2012, p.90-95).

Competitive strategies - online business

There are different kind of competitive strategies and each company have its unique way of running its business. Others are focusing towards uniqueness, others want to build up a customer by providing low-cost product and more ways to strategies and add value to business competitive status. Professor Porte identifies three types of basic competitive strategies that can position your business competition in order to influence consumer decisions and for the success of the business are; cost leadership, product/services differentiation and the focus strategy. To deliver a superior value to customer satisfaction and gain leadership position, Kotler suggested to pursue the value disciplines which consist of three types and they are Operation excellence, Customer intimacy and product leadership. To create a successful competitive advantage, the business must focus on how to satisfy consumers instead of focusing on competition. Knowing your consumers want and provide them with value added product can promote and acquire a strong competitive advantage against your competitor. As mention above there are three types of competitive strategies and in this section I will focus how these competitive strategies can lift your business. In terms of product advantage, consumer tends to differentiate before they buy their needs or wants and compare its cost price this kind of actions tend and mostly happen when shopping online. Online shopping is a way to shop electronically and it is easy to differentiate cost, quality and valued to certainty. Those three types of competitive strategies are the main influence on customer decision. The consumer is always looking for products/services base on quality provided, cost and value added. With all those types of competitive strategies, these can  add value to chain strategy which was first introduced by Michael Porter on 1985 and this value chain is an overall flow process of production of business activity that gives end user or customer a feeling of satisfaction and valued.

Types of basic competitive strategies

Cost leadership is a type of strategies that company are using the low costs to create maximum value to customers. With the low costs in the supply chain, this then can lower product price that able to minimise the cost of production to create low-cost production and distribution. For example, Alibaba, EBay or Amazon are some on online business/retailer that were popular for consumers budget.  Those online retailers produce goods that are accessible to anywhere in the world providing internet is available. This can also help business to business to globalise their supply chain to reduce operating costs. Another example of cost leadership strategy is the airline companies. Most of the airline company like Qantas, Singapore Airline and others have let the passenger do online check in before their flights. With online check-in implementation, this can reduce queue less time will consume equals save employment cost. This strategy is highly successful but hard to implement it is because you need to minimise you production costs to provide a low-cost product. Goods or services differentiation is another competitive strategy that offered to consumers in which customer will choose when it is at a low price. This differentiation is valued by consumers. This is company offered something more than just a low price.  Sometimes, cost leadership can dematerialise if another competitor enters with same low-cost strategy in which offer the same product but lower that what you offer. With this differentiation strategy, you can gain loyal customer easy and maintain your company brand/reputation gives a competitive advantage towards competition. Lastly, Focus strategies are a strategy used by the company who focuses on a certain market. Business used this strategy based on a particular group of a buyer. Example business that offers this type of strategy is business that price of their product at the premium price like MYER or David Jones. In which they only offered goods that are limited to their store only.  According to Kotler, the competitive strategies above can help business to performed well.

Sustaining Competitive Advantage

According to Forbes, Alibaba has increasingly and maintain its positional growth in the e-commerce market. Alibaba success based on research it is because of huge competitive advantage towards competitors (Forbes 2016). How did Alibaba become huge? As a matter of fact, I am a huge fan of Alibaba. I bought some things in there for my business in the Philippines. If you visit their website you can see that they offer offline message and you can get a response quicker than you expected. And what is best is you can communicate directly to the supplier. If you want to order something you have specifically in mind that you want them to make for your business. This can make happen with Alibaba, you say they make. In my opinion and based on my experience this business became big because of its efficiency. An immediate response to your question is a big plus. Also, the effectiveness of its activity has advanced them to competition. Alibaba strong competitive advantage in online business marketing strategy has given them a head start to competitors. With Alibaba, they produce supply that other supplies are unable to provide and they offer greater value of product compared to the competitor. With that, it enhanced consumer relationship and understanding consumer need bring them a lot of ROI. And it is due to low-cost consumer tend to go with Alibaba because of its cost leadership. Alibaba sustainable market due to its long-term management in cultivating customer relationships and establish the leadership in e-commerce. Exceed customer satisfaction has position Alibaba towards to outgrowing success.


With great marketing strategies, this will lead your business to become successful. Uniqueness beats competitor because they are unable to copy the way you exercise your business. Using a different kind of competitive advantage to your business shows more successful compared to those who don't have. A strong competitive advantage shows its performance with their profit. Attracting a largely based consumer  in the market help business like Alibaba to built a strong connection between consumer and the  business. The high standard of their service is one of the reasons of their success. Online business in the 21st century is huge that almost 50 percent of the world population are using the internet. It is a matter of strategies your business and sustaining its competitive advantage that make your business successful. Obtaining business capabilities and offer a great source of sustainable competitive advantage will attain great success. Developing your product that specified to customer wants gives you a predominant in the market. Constant engagement and great strategic decision making can create value to your product and will manipulate your strategies to create value chain movement. I conclude, that the competitive advantage depends on company resources. Understanding product offer creates more values to competition. Just like Jack Ma the founder of Alibaba, he offered uniqueness and resource configurations that build dynamic potential innovation.

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