The Power of Relative Advantage in a Turbulent Economy

As economic uncertainty puts pressure on marketing budgets, brands need strategic approaches to win new business and maximize every dollar spent. Relative advantage is one such approach that can help advertisers stretch their budgets further and stand out in a competitive market.

Understanding Relative Advantage

Often, the easiest way for brands to fuel growth is by outspending their competition: gaining excess share of voice, reaching the broadest pool of consumers, and investing heavily across a variety of channels. With budgets under closer scrutiny, however, few marketers can afford to deploy those strategies at full scale right now.

Relative advantage offers a strategy for working within these constraints. Put simply, it’s the practice of finding opportunities to gain ground that don’t rely on outspending—whether that’s through untapped audiences, underutilized channels, or moments competitors have overlooked. The payoff is significant: Brands that apply relative advantage see an average ROI of 500%, a 40% lift over their peers. They’re also 60% more likely to generate a major lift in awareness and 22% more likely to achieve stronger loyalty gains.

Opportunities to unlock relative advantage often fall into seven key areas:

1. Targeting an underserved audience: For example, a meal kit company focusing on retirees instead of young families.
2. Leveraging atypical media channels: For example, a financial brand running ads on Twitch.
3. Shifting seasonal timing: For example, a swimsuit brand running campaigns in winter to reach consumers planning warm-weather vacations.
4. Trying unconventional dayparts: For example, a coffee brand targeting afternoon energy crashes while competitors focus on the morning rush.
5. Generating social currency by sparking novel conversations: For example, a snack brand launching a “Mystery Flavor” and inviting consumers to debate it on social media.
6. Offering fresh thought leadership: For example, a skincare brand presenting research that rethinks complex routines, positioning simplicity and sustainability as smarter alternatives.
7. Exploring new distribution channels: For example, a meal delivery service setting up ordering kiosks in apartment building lobbies targeting residents arriving after their evening commutes home.

Applying Relative Advantage

The key to applying relative advantage is understanding both competitor and audience behavior, then using those insights to invest where others leave space.

Advertisers don’t need to execute on all seven key areas of relative advantage at once. Rather, they should evaluate each option and focus on the one or two that align best with their brand or client goals and market position.

Discovering Relative Advantage for a Travel Brand

The chart below illustrates how our team put relative advantage to use for a travel brand. We compared competitor spend, consumer interest, and peak travel seasons across multiple regions. This analysis revealed opportunities to increase spend when consumer interest and travel activity were high but competitor spend was low—for example, between June and August in region two. By increasing investment during those months, the brand connected with audiences in timely, high-interest moments while facing less competition, maximizing the impact of their media spend.

Outsmarting the Market

In today’s economic climate, simply outspending competitors isn’t an option for most brands. Relative advantage provides a proven way to stretch budgets further, build stronger connections, and deliver meaningful business outcomes—whatever the market conditions.

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To put relative advantage into practice, advertisers need the right mix of competitive analysis, consumer insights, and marketing expertise to uncover the spaces competitors leave open and fill them strategically. Basis’ media consulting and activation team specializes in uncovering these gaps and turning them into growth. Connect with us to learn more about how our team turns goals into results.