Competitors are emphasizing reliability in product quality

Symptom: Competitors in the industry are stressing their superior product quality.

Implications for the market:

  • Quality and reliability usually represent large market segments in a hostile market.

  • A competitor who achieves a unique reputation for high quality can attract and hold significant market share because quality is an advantage that is hard to duplicate.

    • Quality is often difficult to see and reverse engineer. It is not as easily observed as a price discount or as a more tangible feature benefit. This abstract nature of quality makes it hard to copy effectively.

    • Matching the quality reputation of a very good competitor involves significant commitments of money and time. Developing tighter quality controls and advertising to build a brand name both require significant investments and long time periods.

    • The payback for those investments may be long in coming since a reputation for quality builds slowly as customers learn through their own experience or through word of mouth about the supplier's quality.

  • But reliability, in its broader sense, may be a more effective thrust for innovation.

    • In its broader sense, reliability includes important aspects of relationship such as on-time delivery, problem resolution, guarantee of supply in tight times and consistent market support.

    • These benefits are more subtle and more difficult for a competitor to measure and overcome.

    • In many markets, these reliability benefits outweigh differences in product quality in deciding a customer on his choice of supplier.

Recommended Reading
For a greater overall perspective on this subject, we recommend the following related items:


Perspectives: Conclusions we have reached as a result of our long-term study and observations.

  • "Staying Alive in a Hostile Marketplace"
    A few companies survive and even prosper during periods of hostility. How do these companies avoid being the victims of tough market conditions?

  • "How Customers Buy"
    Customers are often faced with a large number of possible suppliers. How does the customer screen these suppliers to find the one best choice for his need?

  • "Reliability: The Hard Road to Sustainable Advantage"
    Most hostile markets have a large segment where competitors are few and the rewards are great for those who make the effort to get established. This segment is the "reliability" segment.

  • "The Rust Belt Revival"
    The revival of the U.S. Rust Belt in the late 1980's holds lessons for companies who would prosper in hostile market places.