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To Accompany A Framework For Marketing Management, 2 Edition

Porter's Five Forces that Determine Market Attractiveness: Threat of intense segment rivalry Threat of new entrants Threat of substitute products. Identifying competitors can lead to extinction Internet businesses have led to disintermediation of middlemen.

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Ruchi Giri
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79 views27 pages

To Accompany A Framework For Marketing Management, 2 Edition

Porter's Five Forces that Determine Market Attractiveness: Threat of intense segment rivalry Threat of new entrants Threat of substitute products. Identifying competitors can lead to extinction Internet businesses have led to disintermediation of middlemen.

Uploaded by

Ruchi Giri
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Om kothari institute of management & technology Project report of subject Marketing Management.

Submitted to:Richa jain(Assistant professor) Submitted by:Ruchi giri Jyoti verma Mba (sem-I)

Slide 0 in Chapter 8

To accompany A Framework for Marketing Management, 2nd Edition

Dealing with the Competition

Competitive Markets

Porters Five Forces that Determine Market Attractiveness:


Threat

of intense segment rivalry Threat of new entrants Threat of substitute products Threat of buyers growing bargaining power Threat of suppliers growing bargaining power

2003 Prentice Hall, Inc.

Figure 1.1 Five Forces Determining Segment Structural Attractiveness

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall 2003 Prentice Hall, Inc. 11-3

Competitive Markets

Failing to identify competitors can lead to extinction Internet businesses have led to disintermediation of middlemen Competition can be identified using the industry or market approach

2003 Prentice Hall, Inc.

Competitive Markets
Industries Can Be Classified By:

Number of sellers and degree of differentiation Cost structure

Entry, mobility and exit barriers Degree of vertical integration

Degree of globalization

2003 Prentice Hall, Inc.

Competitive Markets
Industry Structures

Pure Monopoly Pure Oligopoly Differentiated Oligopoly Monopolistic Competition Pure Competition

Only one firm offers an undifferentiated product or service in an area


Unregulated Regulated

Example: Most utility companies

2003 Prentice Hall, Inc.

Competitive Markets
Industry Structures

Pure Monopoly Pure Oligopoly Differentiated Oligopoly Monopolistic Competition Pure Competition

A few firms produce essentially identical commodities and little differentiation exists Lower costs are the key to higher profits Example: oil

2003 Prentice Hall, Inc.

Competitive Markets
Industry Structures

Pure Monopoly Pure Oligopoly Differentiated Oligopoly Monopolistic Competition Pure Competition

A few firms produce partially differentiated items Differentiation is by key attributes Premium price may be charged Example: Luxury autos

2003 Prentice Hall, Inc.

Competitive Markets
Industry Structures

Pure Monopoly Pure Oligopoly Differentiated Oligopoly Monopolistic Competition Pure Competition

Many firms differentiate items in whole or part Appropriate market segmentation is key to success Example: beer, restaurants

2003 Prentice Hall, Inc.

Competitive Markets
Industry Structures

Pure Monopoly Pure Oligopoly Differentiated Oligopoly Monopolistic Competition Pure Competition

Many competitors offer the same product Price is the same due to lack of differentiation Example: farmers selling milk, crops

2003 Prentice Hall, Inc.

Competitive Markets

A broader group of competitors will be identified using the market approach Competitor maps plot buying steps in purchasing and using the product, as well as direct and indirect competitors

2003 Prentice Hall, Inc.

Analyzing Competitors
Objectives
Strategies

Competitor Actions

Reaction Patterns

Strengths & Weaknesses


Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall 11-12

2003 Prentice Hall, Inc.

Competitor Analysis
Competitive Positions in the Target Market
Dominant Strong Favorable

2003 Prentice Hall, Inc.

Tenable Weak Nonviable

Competitive Intelligence Systems

Designing the system involves:


Setting

up the system Collecting the data Evaluating and analyzing the data Disseminating information and responding to queries

2003 Prentice Hall, Inc.

Competitive Intelligence Systems

Value analysis helps firms to select competitors to attack and to avoid


Customers

identify and rate attributes important in the purchase decision for the company and competition

Attacking strong, close, and bad competitors will be most beneficial

2003 Prentice Hall, Inc.

Designing Competitive Strategies


Major Strategies
Market-Leader Market-Challenger Market-Follower Market-Nicher

Expanding the total market Defending market share Expanding market share

2003 Prentice Hall, Inc.

Designing Competitive Strategies

Expanding the Total Market:


Targeting

Product to New Users

Market-penetration

strategy New-market strategy Geographical-expansion strategy


Promoting

New Uses of Product Encouraging Greater Product Use

2003 Prentice Hall, Inc.

Designing Competitive Strategies

Defending Market Share


Position defense Flank defense Preemptive defense

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Counteroffensive defense Mobile defense Contraction defense

Designing Competitive Strategies

Before Attempting to Expand Market Share, Consider:


Probability

of invoking antitrust action Economic costs involved Likelihood that marketing mix decisions will increase profits

2003 Prentice Hall, Inc.

Designing Competitive Strategies


Major Strategies
Market-Leader Market-Challenger Market-Follower Market-Nicher

First define the strategic goals and opponent(s) Choose general attack strategy Choose specific attack strategy

2003 Prentice Hall, Inc.

Designing Competitive Strategies

General Attack Strategies:


Frontal

attacks match competition Flank attacks serve unmet market needs or underserved areas Encirclement blitzes opponent Bypassing opponent and attacking easier markets is also an option

2003 Prentice Hall, Inc.

Competitive Markets
Specific Attack Strategies Include:

Price-discount Lower-price goods Prestige goods Improved services Product proliferation

Product innovation Distribution innovation Manufacturing cost reduction

Intensive advertising promotion


2003 Prentice Hall, Inc.

Designing Competitive Strategies

Major Strategies
Market-Leader Market-Challenger Market-Follower Market-Nicher

Imitation may be more profitable than innovation Four broad strategies:


Counterfeiter

Cloner
Imitator Adapter

2003 Prentice Hall, Inc.

Designing Competitive Strategies


Major Strategies
Market-Leader Market-Challenger Market-Follower Market-Nicher

Niche specialties:

End-user Vertical-level Customer-size Specific customer Geographic Product/product line Product feature Job-shop Quality-price Service Channel

2003 Prentice Hall, Inc.

Balancing Customer and Competitor Orientations

Competitor-centered companies evaluate what competitors are doing, then formulate competitive reactions Customer-centered companies focus on customer developments when formulating strategies

2003 Prentice Hall, Inc.

THANK YOU

2003 Prentice Hall, Inc.

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