We are all proud and passionate of being able to walk our own path, and for many that ultimately drives the ephemeral “I have a great IDEA for a business – Online Casino”.

‘We’ and myself included, mock the classic ICE introduction with no expertise, no business plan and frankly no idea. But advice is always at hand and the budding entrepreneurs are encouraged to go back to the school books, define and research their “competitive advantage” and then build a business plan around it.

I can go randomly citing seminal texts on competitor advantage but the one to look up is Porter (Porter, M.E. (1985) Competitive Advantage, Free Press, New York, 1985.) and his breakdown between cost and differentiation strategies.  Where it gets interesting of course is putting this into action, and the online gaming industry veterans have their view on what their competitive advantage is. So rather than try and extract their understanding from a manicured mission statement, vision or corporate brochure blah blah blah, I’ve surveyed their synopses for differentiating factors from company LinkedIn profiles. Do you recognise these as I find them harder the further you read?

In-Play … remains the cornerstone of the business.  Innovation continues to be the lifeblood of the business.

Customer service is at the very heart of everything we do … We focus all our attention on ensuring that we deliver a ‘second to none’ player experience

You may have noticed we’re not ones to steer clear of the controversial either.

We have Europe’s greatest and most user friendly mobile casino. It sets up a completely new standard for what you can and should expect from your mobile phone.

We’re not working with casino, we’re working with changing what the common perception of casino is.

We’re as much part of British society as your local Supermarket.

strives to deliver the best customer experience in the industry…

we’re one of the most recognised, respected and trusted brands in the industry.

Part marketing strategy, part corporate goals, true advantage needs to be earned. So what are the options?

1) Lower cost – in academic terms this is least cost to the consumer or Price! And so we all know bonus and promotion wars are rife within the online gaming industry executed badly and corporations run at a loss, executed poorly and the profit is sucked out from all operators. Generous Welcome Offers  that return healthier LTV assist a low-cost strategy but if the LTV extracted is not higher than the competition then this is not an advantage. Any low cost strategy is typically very hard to maintain given the ease of copying and the attempts generally hurt the industry.

2) Differentiated product – and this isn’t necessarily game content; faster payouts, tournaments, HTML5 have all been product improvements afforded competitive advantage to the early adopters. Sustaining the advantage is again  the issue hence for many ‘restrictive regulation’ is as much a differentiated product opportunity as a threat. Gaming content has been at the vanguard for years but, with a plethora of established operations (with 20 or so gaming integrations) coupled with the rise of content ‘aggregators’ that can supply even the smallest of operators, we are seeing a resurgence of exclusivity as well as a move toward differentiated experience if not content.

3) Innovate – we all love this, but comes in different forms.  Good innovation leads through differentiated product, patents and know-how that can sit you apart; harder is a process of continual innovation ensuring you are always at the start of the S-curve and have advantage through those early adopter followers who love you; but in-vogue is that “disruptive innovation”, I think it brings out the child in everyone, tearing down walls and building new empires. Undoubtedly ‘disruption’ is the path hardest to adopt for any established business, somehow disruption by osmosis just doesn’t seem to cut it.

4) Efficiency – my personal golden child. With a goal to perform internal business activities better than competitors, in turn ensuring your business is the one most desired to ‘transact’ with, look up ‘transactional costs’ as I’m not talking PSP costs here :-). Given a choice; players, affiliates, software suppliers, employees all prefer to contract or transact with  company that takes less time, can be thorough, makes less mistakes, can be transparent, accesses relevant information etc etc. In a double whammy that allows a business to hold more value in the transaction at same time as also removing or reducing many of their own transaction costs. If you think that is ‘woolly’ try to define what is at the core of profitability of Dominoes Pizza or  Direct Line Insurance (please, let me off with the first mover advantage argument 🙂 ).

Do you know your own path, do you know your competitive advantage? Or in this mixed up marketplace can you even guess at the advantage of your brand peers?

“A firm is said to have a competitive advantage when it is implementing a value creating strategy not simultaneously being implemented by any current or potential player” (Barney 1991 cited by Clulow et al.2003, p. 221).