Lectures Marketing management: Chapter 11 - ThS. Nguyễn Tiến Dũng

 Lectures "Marketing management - Chapter 11: Dealing with competition" provides students with the knowledge: Industry analysis, competitor analysis, competitive strategies by market position, product life cycle strategies. Invite you to refer to the disclosures.

CHAPTER 11 DEALING WITH COMPETITION

Nguyen Tien Dung, MBA Email: dung.nguyentien3@hust.edu.vn

Chapter Questions

1 How do marketers identify primary competitors?

2 How should we analyze competitors’ strategies,

objectives, strengths, and weaknesses?

3 How can market leaders expand the total

market and defend market share?

4 How should market challengers attack market

leaders?

5 How can market followers or nichers compete

effectively?

Main Contents

1. Industry Analysis

2. Competitor Analysis

3. Competitive Strategies by Market Position

4. Product Life Cycle Strategies

1 Industry Analysis

● To identify opportunities and threats

associated with the doing business in the

industry

● To determine profitability and risks when

doing business in the industry

● Tool: Five-force model by Michael Porter

Five-Force Model by Michael Porter

Five Forces Determining Segment Structural

Industry Concept of Competition

● Number of sellers and degree of

Strengths and Weaknesses

● Share of market

● Share of mind

● Share of heart

● Identify the best-in-class companies

● Measure the performance of best-in-class

companies

● Measure the company’s performance

● Specify programs and actions to close the gap

● Implement and monitor results

2.1 Identify Competitors

● Industry concept of competitors:

● Market concept of competitors

Industry Concept of Competitors

● Industry concept of competitors:

● An industry is a group of firms that offer a product or class of

products that are close substitutes for one another.

● Competitors are the companies who belong to the same

Number of sellers and degree of differentiation

● Monopoly

● Oligopoly

● Monopolistic competition

● Pure competition

Market Concept of Competitors

● Brand competitors: Lead versus Attila

● Product-form competitors: scooter

motorbikes versus “Honda Cub” motorbikes

● Generic competitors (product-category

competitors): motorbikes versus cars

● Need competitors: transportation needs

versus other needs

2.2 Identifying Competitors’ Strategies and Objectives

● Market share first or profit first?

● Which market segments?

Key Principles in “Blue Ocean Strategy”

FORMULATION PRINCIPLES

● a Reconstruct market boundaries

● Look across alternative industries

● Look across strategic groups within industries II Look across chain of buyers

● Look across complementary product and service offerings

● Look across functional or emotional appeal to buyers Look across time

● b Focus on the big picture not the numbers

● c Reach beyond existing demand

● d Get the strategic sequence right

● Is there buyer utility?

● Is the price acceptable?

● Can we attain target cost?

● What are the adoption challenges?

2.3 Evaluating Competitors’ Strengths and Weaknesses

Share of mind, Share of heart, and

Share of market

2.4 Selecting Competitors to Attack and to Avoid

● Strong versus weak

● Close versus Distant

● Good versus Bad

3.1 Competitive Strategies for Market Leaders

● Expanding the total market

Six Types of Defense Strategies

Counter-offensive Strategy: FedEx vs UPS

Market Leaders: Ariat

Combining comfort with

rugged wear, Ariat is taking on

the market leaders in the

cowboy boot market.

Leaders’ Strategies: When Your Competitors Delivers More for Less, p 300

● Identify market leaders

● K-Mart >< Walmart & Target

● Boots, Sainbury > < ASDA & Tesco

● British Airways > < EasyJet

● What are their strategies to defense their

3.2 Competitive Strategies for Market Challengers

● Who to attack strategies: the market leader, the same-size competitors, the smaller

Challengers: Pepsi vs Coke

Specific Attack Strategies

● Intensive advertising promotion

3.3 Competitive Strategies for Market Followers

Adapter: Telepizza

● Telepizza adapted Domino’s pizza delivery concept to Spain with much success.

3.4 Competitive Strategies for Market Nichers

● High margin strategy

● High volume strategy

● Single versus multiple niching strategies

Niche Specialist Roles

● ITW

● Zippo

● Digicel

Nicher Strategies: The Case of Zippo

Zippo has expanded its brand

meaning to encompass “all

flamerelated products” to

ensure its long-term growth

prospects.

3.5 Balancing Customer and Competitor Orientations

● A competitor-centered company focuses

more on competitors’ action and sets

strategies and plans to react competitors’

programs

● A customer-centered company focuses more

on customer developments to setting up

strategies

4 Product Life-Cycle Marketing Strategies

Special Types of PLCs

Evidence of PLC

which sales increase by roughly 45 percent a year, but they also show a distinct slowdown, when sales decline

by roughly 15 percent a year.

average, well before most households own a new

product.

does not seem to shorten over time.

more likely to adopt over time if others already have,

instead of by making careful product evaluations One implication is that product categories with large sales increases at takeoff tend to have larger sales declines

at slowdown.

Marketing Strategies: Decline Stage

Special Patterns of PLCs