International Journal of Business and Social Science
International Journal of Business and Social Science
Vol. 2 No. 13 [Special Issue - July 2011]
Defensive and Offensive Strategies for Market Success
Dr. Peter Yannopoulos Associate Professor Brock University, St. Catharines Ontario, Canada, L2S 3A1 E-mail: pyannopoulos@brocku.ca Tel: (905) 688-5550 ext. 3909 Abstract
In industries in which there is strategic interaction among competing firms, companies are continuously involved in defensive and offensive strategies. In this paper we discuss several defensive and offensive strategies that managers can you for market success. Defensive strategies are divided into pre-entry and post-entry stretegies. Marketing managers should attempt to discourage would be entrants before entry has occurred. They can achieve this goal by engaging in pre-entry startegies. After entry is occurred it is more difficult to persuade new entrants to exit the industry. For this reason, marketing managers should use different defensive strategies for defending their positions in pre-entry and post-entry situations.
Key words: Defensive strategies, offensive strategies, pre-entry strategies, post-entry strategies 1. Introduction
Competition forces companies to constantly engage in offensive and defensive marketing strategies. Rivalry occurs because one or more competitors either feels the pressure or sees an opportunity to enter an industry or to improve its position within an industry. In most cases, competitive moves by one firm have noticeable effects on its competitors and, thus, may invite retaliation or efforts to counter the move (Porter 1980). Companies respond to competitor challenges by counterattacking with increasing advertising expenditures, cutting prices, increasing innovation, and introducing new products, or even accommodating the entrant by doing nothing or decreasing the level of marketing effort (Karakaya and Yannopoulos, 2011; Scherer, 1980). Firms grow by taking market share from rivals or creating new markets.
Vol. 2 No. 13 [Special Issue - July 2011]
Defensive and Offensive Strategies for Market Success
Dr. Peter Yannopoulos Associate Professor Brock University, St. Catharines Ontario, Canada, L2S 3A1 E-mail: pyannopoulos@brocku.ca Tel: (905) 688-5550 ext. 3909 Abstract
In industries in which there is strategic interaction among competing firms, companies are continuously involved in defensive and offensive strategies. In this paper we discuss several defensive and offensive strategies that managers can you for market success. Defensive strategies are divided into pre-entry and post-entry stretegies. Marketing managers should attempt to discourage would be entrants before entry has occurred. They can achieve this goal by engaging in pre-entry startegies. After entry is occurred it is more difficult to persuade new entrants to exit the industry. For this reason, marketing managers should use different defensive strategies for defending their positions in pre-entry and post-entry situations.
Key words: Defensive strategies, offensive strategies, pre-entry strategies, post-entry strategies 1. Introduction
Competition forces companies to constantly engage in offensive and defensive marketing strategies. Rivalry occurs because one or more competitors either feels the pressure or sees an opportunity to enter an industry or to improve its position within an industry. In most cases, competitive moves by one firm have noticeable effects on its competitors and, thus, may invite retaliation or efforts to counter the move (Porter 1980). Companies respond to competitor challenges by counterattacking with increasing advertising expenditures, cutting prices, increasing innovation, and introducing new products, or even accommodating the entrant by doing nothing or decreasing the level of marketing effort (Karakaya and Yannopoulos, 2011; Scherer, 1980). Firms grow by taking market share from rivals or creating new markets.
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