Competitor analysis is an assessment of the strengths and weaknesses of current and potential competitors. Porter (1980, 1998) argued that most firms do not conduct this type of analysis systematically enough. Instead, many enterprises operate on what he calls “informal impressions, conjectures, and intuition gained through the tidbits of information about competitors every manager continually receives.” ING’s analysis of its competitors was that they were old fashioned and very conventional. They want to make the customer spend more, borrow more, pay lower interest and most customers were unsatisfied and “very critical” of their banks. They have not updated their methods of banking to a new more modern way of banking. Arkadi Kuhlmann, founder of IHG was very clear about his goals for IHG “There is no such business that can’t be reenergized”. With this in mind he planed to get customers to save more, give them better value with higher interest rates, deal direct via new technologies and create satisfied customers with no minimum balances, no fees and no service charges. Reference:
ING Direct. Rebel in the banking industry. Dr. Verwerie and Dr. Van den Berghe. 2007. www.wikipedia.org
I agree with Martin in that ING Ditrect has exploited the fact that competitor numbers are small and that this industry has not changed radically for some time. I have no doubt that Kuhlmann’s pedigree in the banking sector was proven prior to ING, I also have no doubt that he had strategic analysis completed on competitors, focusing on the “seven key areas” breaking each one down using the “five forces model” for competitive forces, using “PEST” for driving forces, using strategic group maps to show competitive position, identifying competitor strategies then using all this information to indicate the key success factors and then ascertain how attractive this new venture would be. But if we remember that ING Direct Banking...