Bài giảng MARKETING MANAGEMENT LECTURE NOTES: chap 4 analyze competitors

Prepared by: Huỳnh Hạnh Phúc Michael Porter’s competitive five forces Define the competitors Analyze the competitors Competition strategies Current competitors Substitute products Potent

Prepared by: Huỳnh Hạnh Phúc

Michael Porter’s competitive five forces Define the competitors

Analyze the competitors

Competition strategies

Current competitors

Substitute products

Potential competitors

Power of suppliers

Power of customer

Threat of new competitors

Threat of subtitution

Definition:

The process of identifying major

competitors , assessing their objectives,

strategies, strengths and weaknesses ,

and selecting which competitors to

attack or avoid

1 Who the competitors are

2 What the competitors’ objectives are

3 What their strategies are

4 What their strengths and weaknesses are

5 What their reaction patterns are

6 Who to confront and how to avoid

Competitors could be

DIRECT (within the same industry or market sector)

INDIRECT (competing for the consumer

dollar-substitutes)

LATENT (potential threats)

Brand competitors

• Same product

• Same segmentation

• Same price

• Pepsi & Coca Cola, 7 Up & Sprite

Product competitors

• Same product

• Different segmentation

• Different price

• 7 Up & Xá xị Chương Dương

Generic competitors

• Different product Provide same function Eg drink, transports, etc.

• It attempts to satisfy the same basic customer need Pepsi & sugar cane, ice tea

Total budget competitors

- It would be any companies that have a same costs

- Customer can spend 7000 VND (7up’s price) for many different kind of products

4

TOTAL BUDGET COMPETITORS

Each competitor has a mix of objectives

The company wants to know the relative importance that a competitor places on current profitability, market share growth, cash flow, technological leadership, service leadership, and other goals.

Knowing a competitor’s mix of objectives reveals whether the competitor is satisfied with its current situation and how it might react to different competitive actions

A company must also monitor its competitors’

objectives for various segments

The more that one firm’s strategy resembles another firm’s strategy, the more the two firms compete.

A strategic group is a group of firms in

an industry following the same or a similar strategy in a given target market

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Marketers need to assess each competitor’s strengths

and weaknesses carefully in order to answer the critical

question:What can our competitors do?

As a first step, companies can gather data on each

competitor’s goals, strategies, and performanceover the

last few years

Companies normally learn about their competitors’

strengths and weaknesses through secondary data,

personal experience, and word of mouth

Development rate Market share Profitability Objectives Strategy Target market

R&D Production HR Customer’s perception Marketing & brand

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Customer segmentation

What are they looking for?

What does it motivate competitors?

What will our competitors do?

A competitor’s objectives, strategies, and strengths and weaknesses go a long way toward explaining its likely actions They also suggest its likely reactions to company moves such asprice cuts, promotion increases,

or new-product introductions.

Each competitor reacts differently

Strong or Weak Competitors: Most companies prefer to

compete against weak competitors This requires fewer

resources and less time But in the process, the firm may

gain little

Close or Distant Competitors: Most companies will

compete with close competitors—those that resemble

them the most—rather than distant competitors

“Good” or “Bad” Competitors: Good competitors play

by the rules of the industry Bad competitors break the

rules They try to buy share rather than earn it, take large

risks, and in general shake up the industry

Strategy Marketing R&D HR Finance Customer’s perception

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1 Read the content of chapter 5 and analyze

your company’s customer behavior

and the factors that impact to the

customer behavior

2 Present the implication of the analysis

result (Customer insight)