Differential Advantage

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Competitive advantage
Competitive advantage (CA) is a position that a firm occupies in its competitive landscape. Michael Porter posits that a competitive advantage, sustainable or not, exists when a company makes economic rents, that is, their earnings exceed their costs (including cost of capital). That means that normal competitive pressures are not able to drive down the firm's earnings to the point where they cover all costs and just provide minimum sufficient additional return to keep capital invested. Most forms of competitive advantage cannot be sustained for any length of time because the promise of economic rents drives competitors to duplicate the competitive advantage held by any one firm.
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MONASH Marketing DictionaryDownload this dictionary
Differential Advantage
the element or factor in a firm's product or strategy which makes it superior to that of a competitor.

2004 (c) Copyright & Reprint Courtesy of the Dept. of Marketing, Faculty of Business and Economics, Monash University; edited by Mr. Don Bradmore.

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