As mentioned in the assignment, competitive advantage is the advantage firms have over competing firms. There are various reasons why firms have it and ways this advantage is maintained.
One of the ways is to be the first entrant into a market. A good example of this is Microsoft. They had the first mainstream operating system for a personal computer. Today there is very few other operating systems used while Microsoft's remains the most popular. In addition to that, they are the number 1 software company in the world and the 3rd largest company in the world. So it is fair to say that they maintained their competitive advantage.
While on the topic of computers and Microsoft, the company Apple comes to mind. Macintosh computers that run on Apple's operating system managed to position themselves in a specific niche. They have always been considered better for professional video or graphics editing and apply to students and artsy crowds. They reinforced this concept through advertisements featuring the business IBM guy that never works, and the regular Mac guy that is always better at everything. So Apple managed to dominate that specific market which is a good example of niche dominance. They're also the 4th largest technology, hardware and equipment manufacturer in the world.
A good example of competitive advantage due to market share is the brewery, Anheuser-Bush. They own almost 50% of the market share in the US, this allows them to dominate distribution channels, forcing wholesalers into exclusive contracts and making it very difficult for smaller companies to sell beer on a larger scale.
Google is a good example of a firm with government protection. The patent on the software algorithm for their search engine protects other firms from copying their invention and no other search engine as simple to use and as effective has been made. Due to this and advertisers' interest in google's search engine, Google became the number 3 software company in the world, just from a search engine.
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It is so true that being the first entrant into a market can be one of the main competitive advantage but what else if there is any, to make Microsoft as being the top competitor within its market? What have they done to make them so successful and always being the top player?
Good post. One thing I didn't know was that Anheuser-Bush owned 50% of the market. do you think WalMart will fit into this category too? They kind of force their distributors into contracts though. lol
Microsoft is great example
I think of Apple as a first mover instead of a niche dominate company because I think that other competitors such as sony may have a longer history in this field. On the other hand, Microsoft can be niche dominate because whenever people buy computers or software, they think of Mircrosoft first.
Lenny,
I like your technology base examples, Microsoft, apple and Google.
All three companies have something in common and that is improving in their field to be the best and reach such high standard those others can not go up against alone. But out of all of them I like apple the most, reason being it uses both products Google and Microsoft to enhance its product to the consumer. Apple computers can run Microsoft operation system with the Intel-Mac hardware and apple can use Google software that many people love on both sides on the Microsoft OS or on the Mac OS. This really promotes a product in a new light.
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