Question

the four criteria for sustainable competitive advantages of adult beverages

Answer 1

According to Porter's competitive advantage model, 4 strategies can be applied in any business. Cost leadership, differentiation, cost focus strategy, and differentiation focus strategy. Adult beverages targets a larger section of the society. According to the consumers, the companies adhere to strategies like for common people who wants a strong, rich and cheaper option, they apply low cost strategies. Rum, tequila, whiskey etc are of varied qualities for which their price varies. Some sections of society choose organic products, and focuses on costlier option i.e. they do not compromise with the quality. Some prefer old rums which tastes better. In this case, the taste and it's uniqueness is preferred, so it comes under differentiation strategy. Focussed differentiation and focused cost depends on a particular group which searches for uniqueness and cost respectively. The four criterias are valuable capabilities, rare capabilities, difficult to imitate and non-substituability capabilities. These unique criteria can make the adult beverage distinct from those available in the market. First, if the demand for the beverage is too high and people perceive that there is no substitute in taste, quality, cannot be imitated and there is no compromise in availability, then the beverage will be long-term sustainable.