Social media and its impact on competitive advantage

Owen Cutajar
Social Media and its Impact on Competitive Advantage

Introductions
20 years experience in technology
MBA from Heriott-Watt
On-Island since 1999
Day job: Enterprise IT
Passion for blogging/Social Media
Cofounded IOM Social Media Club
Twitter: @OwenC
www.facebook.com/OwenCutajar
Email: owen@cutajar.net

Topics to Cover

Sustainable Competitive Advantage
Larger Market
Uniqueness
Cost
Smaller Market

Cost Leadership
Being the cheapest option on the market through:
Improving processes
Economies of scale
Access to raw materials
Vertical Integration
Access to capital
High level of expertise
Efficient distribution channels

Differentiation Strategy
Unique product or service
Access to cutting-edge research
Highly skilled and creative development team
Corporate reputation for quality
Strong sales team
Leaders in innovation

Focus Strategy
Concentration on a narrow segment
Within segment implements cost advantage or differentiation
High degree of customer loyalty
Customers ready to pay more
Multiple niche strategy

The Impact of Technology
Multitude of benefits including:
Automation
Management of information
Reductions in operational costs
Monitoring and Reporting
Communication networks with suppliers/partners
Interaction with customers

Definitions ofSocial Media?

Social Media and Cost Leadership
Low advertising and PR costs
Reduced cost of creating content & conversations
Lowering cost of product design by listening to the network
Lower customer services cost

Social Media & Differentiation
Effective way to build a brand “voice”
Ability to accurately target and dialogue with potential customers
Tap into passionate fan base
Analytics on audience
Creation of viral content

Social Media & Niche Markets
Provides global reach
The rise of micro-targeting
Creates viable niches which wouldn’t otherwise exist
Creating communities
Minimal cost

Practical advice from Starbucks
Whenever Starbucks identifies a problem or opportunity, it responds in one or more of the following four ways:
Amplify: As Starbucks identifies trends or something its customers seem to like, Starbucks amplifies whatever it is to help bring it to the surface and increase visibility and enthusiasm.
Context-ify: Back in 2004, an e-mail was going around claiming that Starbucks had refused to supply free product to GIs serving in Iraq. Many people believed it, got pretty angry and forwarded the message to all their friends. Unfortunately, the message was false. By context-ifying the message, Starbucks revealed the other side of the story--check it out yourself on snopes.com.
Change: If it's broke, fix it. MyStarbucksIdea.com actively solicits constructive criticism and ideas to improve its business and gather suggestions for products, services and projects.
Ignore:You gotta respond? No, sometimes it's best to ignore, especially when it appears you're being provoked into a response or fight. It's easier to ignore things when you can put them into their proper context; for example, if your primary critics are a Facebook Group with 82 members out of the 400 million-plus Facebook accounts, you have little to worry about.

Roadmap to Maturity

A question of survival
About Online Markets:
“Networked markets are beginning to self-organize faster than the companies that have traditionally served them. Thanks to the web, markets are becoming better informed, smarter, and more demanding of qualities missing from most business organizations.”
Source: The Cluetrain Manifesto: The End of Business as Usual (Rick Levine, Christopher Locke, Doc Seals, David Weinberger)

Questions?

Contact and Credits
Where to find me
Email: owen@cutajar.net
Twitter: @owenc
Facebook: Search for “Owen Cutajar”
Additional reading
The 10 Stages of Social Media Integration in Business
http://tinyurl.com/jcc01
On Competition (Michael Porter)
http://tinyurl.com/jcc02

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Social media and its impact on competitive advantage

by Owen Cutajar on Sep 14, 2010

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Social media and its impact on competitive advantage — Presentation Transcript