Business Operations

From the Expert: Stand Out From the Competition

From the Expert: Stand Out From the Competition
 

The majority of midsize businesses cite quality as the primary focus of their competitive strategy, so developing a product that stands out from the competition can be a challenge. In this Q&A, Douglas Bowman, professor of marketing at Emory University’s Goizueta Business School, shares how commitment to quality can help your business maintain a competitive advantage.

How can businesses set themselves apart by providing products or services of superior quality?

Douglas Bowman: Strategies will differ depending on whether the business markets physical products or services. For instance, people often talk about technology products like Apple because of their design, but you don't have to be the provider working on design. AT&T, for example, may offer quality through service or distribution. It’s possible to be multifaceted and compete on different dimensions.

How can businesses communicate the quality and reliability of their product or service?

Bowman: Customers form perceptions of quality and reliability from three broad sources of information: the physical specs or characteristics of the product (its engineering features), their own prior experiences with the product or service and the firm’s communication efforts. Each is a lever businesses can seek to improve.

Do you believe businesses can consistently provide the highest-quality product at the lowest price?

Bowman: It’s better to think of optimizing quality rather than maximizing quality because there may be some aspects of your product or service where maximizing leads to overinvesting. If a retailer provides Wi-Fi as a perk for its customers and the Wi-Fi becomes unreliable, for example, those customers are dissatisfied, but investing in a faster Wi-Fi may not make sense for the retailer because it’s not valued by customers for one reason or another and won’t have a measureable payoff. There may be other attributes where there are decreasing returns to the value created for customers. It may even get to a point where additional investments result in such modest incremental gains in value that they may not be worth it.

What are some ways businesses can learn about their customers’ quality needs?

Bowman: Think outside the “traditional market research” box. Conduct observational studies, in-depth interviews and use focus groups to identify your customers’ pain points. What keeps them up at night? Once you understand that, you can look for solutions to address those concerns. Also, make sure you understand how your customers are defining quality. Your company may think it’s one thing, and your customers may think it’s something entirely different.

What is a mistake you often see companies make when focusing on quality?

Bowman: Many mistakes occur when companies are building their value proposition. The least sophisticated businesses are very internally focused and have the mindset of, “Here's all the good qualities my company adds to the marketplace.” You should instead focus on understanding where your good qualities are, which ones your customers value and how these qualities differentiate you from the competition.

How do you recommend business leaders push themselves and their team to stay ahead?

Bowman: Determine solutions that aren’t obvious. I have a faculty member that teaches an entrepreneurship class and one of his exercises is, “How would you innovate the pillow?” And I’m always surprised what people can come up with. When you think higher order, you will see there are many different ways to solve the same problem.

For more information on competitive strategy, read our complete guide. Or contact your SunTrust banker today to learn more about the resources available to you to support your strategy and strengthen your market share.

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