Chapter 18

Market Nicher Strategies

- By customer, market ,quality price, service - Multiple niching

Market Leader Strategies

- Expand total market - Protect market share - Expand market share

Market Follower Strategies

- Follow closely - Follow at a distance

Market Challenger Strategies

- Full frontal attack - Indirect attack

Competitors can include:

-All firms making the same product or class of products -All firms making products that supply the same service -All firms competing for the same consumer dollars

Market Leaders protect current market by:

-Fixing or preventing weaknesses that provide opportunities to competitors -Maintaining consistent prices that provide value -Keeping strong customer relationships -Promoting continuous innovation

Market Leaders expand market share by:

-Increasing profitability with increasing market share in served markets -Producing high-quality products -Creating good service experiences -Building close relationships

Market Leaders expand total demand by developing:

-New users -New uses -More usage

Market Follower Strategies:

-Play along with competitors and not rock the boat -Copy or improve on leader's products and programs with less investment -Bring distinctive advantages -Keep costs and prices low or quality and services high

Overall cost leadership strategy

A company achieves the lowest production and distribution costs and allows it to lower its prices and gain market share.

Differentiation strategy

A company concentrates on creating a highly differentiated product line and marketing program so it comes across as an industry class leader.

Focus strategy

A company focuses its effort on serving few market segments well rather than going after the whole market.

Market Nicher Strategies:

An ideal market niche is big enough to be profitable with high growth potential and has little interest from competitors. The key to market niching is specialization: -Market -Customer -Product -Marketing mix

Second mover advantage

Challenger observes what has made the leader successful and improves on it.

market leader

a firm with the highest market share in a given market

strategic group

a group of firms in an industry following the same or a similar strategy in a given target market.

Market Leaders challenge the leader with:

an aggressive bid for more market share.

____ is the process of comparing the companies products or processes to those of competitors to find ways to improve the quality and performance.

benchmarking

Each competitor has a mix of objectives, the company wants to know the relative importance that a competitor places on all of the following except ____.

company history

benchmark

comparing the company's products and processes to those of competitors or leading firms in other industries to identify best practices and find ways to improve quality and performance thereby increasing a company's competitiveness.

In the context of identifying competitors' strategies, the more that one firm's strategy resembles another firm's strategy, the more likely the two firms are to _____

compete

Gaining ____ requires delivering more value and satisfaction to target consumers than competitors do.

competitive advantage

Strategies that strongly position a company against its competitors, and give the best possible strategic advantage are ____ strategies.

competitive marketing

If a company identifies its competitors from an industry point of view, it must understand _____ to be an effective player in that industry.

competitive patterns

A company is guilty of _____ if it forgets late competitors and only focuses on current competitors.

competitor myopia

The first step in initiating competitive marketing strategies is to ______.

conduct competitor analysis

Customer value analysis

determines the benefits that target customers' value and how customers rate the relative value of various competitors' offers. -Identification of major attributes that customers value and the importance of these values -Assessment of the company's and competitors' performance on the valued attributes

market nichers

firms that serve small market segments not being pursued by other firms

Competitive marketing strategies

how companies analyze their competitors and develop value-based strategies for profitable customer relationships. (strategies that strongly position the company against competitors and give it the greatest possible competitive advantage)

Companies can identify their competitors from both ____ points of view.

industry and market

Formulated marketing

involves developing formal marketing strategies and following them closely.

Intrepreneurial marketing

involves the attempt to reestablish an internal entrepreneurial spirit and refresh marketing strategies and approaches.

Entrepreneurial marketing

involves visualizing an opportunity and constructing and implementing flexible strategies.

A company has already largely selected its major competitors through prior decisions on customer targets, positioning, and its _____.

marketing-mix strategy

A company without a clear strategy, "a _________", will not succeed.

middle-of-the-roader

market followers

other runner-up firms that want to hold their share without rocking the boat

Product leadership

refers to a company providing superior value by offering a continuous stream of leading-edge products or services. Product leaders are open to new ideas and solutions and bring them quickly to the market.

Customer intimacy

refers to a company providing superior value by segmenting markets and tailoring products or services to match the needs of the targeted customers.

Operational excellence

refers to a company providing value by leading its industry in price and convenience by reducing costs and creating a lean and efficient value delivery system.

Competitive advantages

require delivering more value and satisfaction to target consumers than competitors.

market challengers

runner-up firms that are fighting hard to increase their market share

A market-centered company...

spends most of its time focusing on both competitor and customer developments in designing strategies.

A competitor-centered company...

spends most of its time tracking competitor's moves and market shares and trying to find ways to counter them

A companies objectives indicates a satisfaction with its current situation and _____.

strength of current management

Competitor analysis

the process of identifying, assessing, and selecting key competitors.