Principles of Marketing Ch 18 Notes
Ch 18 – Marketing
Competitive advantage – an advantage over competitor gained by offering consumers greater value than competitors do. * Customers will see competitive advantages as customer advantages
Competitive Marketing Strategies – Strategies that strongly position the company against competitors and give the company the strongest possible strategic advantage.
Competitor Analysis – The process of identifying key competitors; assessing their objectives, strategies, strengths and weaknesses, and reaction patterns; and selecting which competitors to attack or avoid.
Identifying competitors * Competitors can include: All firms making the same product or class of products, all firms making products that supply the same service, or all firms competing for the same consumer dollars * Companies can identify competitors from an industry point of view (e.g. oil or pharmaceutical industry; Pepsi’s competitor would be Coca-Cola). * Companies can identify competitors from a market point of view – they define competitors as companies that are trying to satisfy the same customer need or build relationships with the same customer group (the customer wants “thirst quenching” – a need that can be satisfied by bottled water, energy drinks, fruit juice, etc). * Companies must avoid competitor myopia – a company is more likely to be “buried” by its latent competitors than its current ones (Tower Records didn’t go bankrupt by traditional music stores, but by BestBuy/Apple store).
Assessing competitors –
* Determining competitors 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, etc. They also must monitor its competitors objectives for various segments * Identifying competitors’ strategies -
Strategic group – a group of firms in an industry following the same or similar strategy
Competitive advantage – an advantage over competitor gained by offering consumers greater value than competitors do. * Customers will see competitive advantages as customer advantages
Competitive Marketing Strategies – Strategies that strongly position the company against competitors and give the company the strongest possible strategic advantage.
Competitor Analysis – The process of identifying key competitors; assessing their objectives, strategies, strengths and weaknesses, and reaction patterns; and selecting which competitors to attack or avoid.
Identifying competitors * Competitors can include: All firms making the same product or class of products, all firms making products that supply the same service, or all firms competing for the same consumer dollars * Companies can identify competitors from an industry point of view (e.g. oil or pharmaceutical industry; Pepsi’s competitor would be Coca-Cola). * Companies can identify competitors from a market point of view – they define competitors as companies that are trying to satisfy the same customer need or build relationships with the same customer group (the customer wants “thirst quenching” – a need that can be satisfied by bottled water, energy drinks, fruit juice, etc). * Companies must avoid competitor myopia – a company is more likely to be “buried” by its latent competitors than its current ones (Tower Records didn’t go bankrupt by traditional music stores, but by BestBuy/Apple store).
Assessing competitors –
* Determining competitors 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, etc. They also must monitor its competitors objectives for various segments * Identifying competitors’ strategies -
Strategic group – a group of firms in an industry following the same or similar strategy