Marketing Competitive Advantage Exam
Red ocean strategy
-compete in existing market space -beat the competition -explore existing demand
Blue ocean strategy
-create uncontested market space -make competition irrelevant -create and capture new demand
Competitor reactions to changes in price
-develop a fighting brand -reduce prices -increasing advertising spending -increase sales promotions
Four action framework
-eliminate -reduce -raise -create
Market leader strategies
-expand total demand -protect their current market -expand market share
Protect current market
-fixing or preventing weaknesses that provide opportunities to competitors -maintaining consistent prices that provide value -keeping strong customer relationships -promoting continuous innovation
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
Competitor centered company
Spends most of its time tracking competitors' moves and market shares and trying to fine ways to counter them (advantage: company is a fighter; disadvantage: company is reactive)
Competitors' strategies
Strategic group offers the strongest competition
Designing a competitive intelligence system
-identifies competitive information and the best sources of this information -continually collects information -checks information for validity and reliability -interprets information -organizes information -sends key informations to relevant decision makers -responds to inquiries about competitors
Expand market share
-increasing profitability with increasing market share in served markets -producing high quality products -creating good service experiences -building close relationships
Competitive positions
-market leader strategies -market challenger strategies -market follower strategies -market nicher strategies
Basic competitive strategies
-overall cost leadership -differentiation -focus -middle of the road
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
Competitors' objectives
-profitability -market share growth -cash flow-technological leadership -service leadership
Bad competitors
-rather than engaging in market building by bringing new customers to the market, they grow their business by buying shares not earning it -they take large risks that may destabilize the industry resulting in decrease in profits for all firms -they play by their own rules
Good Competitors
-share in the cost of product and market development -legitimize new technology -they may serve less attractive segments or lead more product differentiation -the may help increase total demand
Overall cost leadership
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
Assessing
Assess competitors' objectives, strategies, strengths and weaknesses, and reaction patterns
Utility levers
Customer productivity, simplicity, convenience, risks, fun and image, environment friendliness
Customer value analysis
Determines the benefits that target customers' value and how customers rate the relative value of various competitors' offers
Expand total demand
Develop new users, new uses, more usage
Competitive marketing strategies
How companies analyze their competitors and develop value based strategies for profitable customer relationships
Identifying
Identify the company's competitors
Value innovation
New way of thinking about and executing strategy that results in the creation of a blue ocean. About driving costs down while simultaneously driving up value for buyers.
Competitor analysis
Process of identifying , assessing, and selecting key competitors
Buyer's Experience
Purchase, delivery, use, supplements, maintenance, disposal
Product leadership
Refers to a company providing superior value by offering a continuous stream of leading-edge products or services
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
Selecting
Select which competitors to attack or avoid
Market centered company
Spends most of its time focusing on both competitor and customer developments in designing strtegies
Customer centered company
Spends most of its time focusing on customer developments in design strategies. Provides a better position than competitor centered company to identify opportunities and build customer relationships.
Fun and image
The innovation delights customers
Environment friendliness
The innovation facilitates recycling and other environmentally sensitive practices
Customer productivity
The innovation helps customers do things faster, better, or different
Convenience
The innovation makes a desired activity easier to perform
Risks
The innovation minimizes customers' financial or physical risks
Simplicity
The innovation offers enhanced ease-of-use
Competitors' strengths and weaknesses
What can our competitors do?
Estimating competitors' reactions
What will our competitors do?
Create
Which factors should be created that the industry has never offered?
Raise
Which factors should be raised well above the industry's standard?
Reduce
Which factors should be reduced well below the industry standard?
Eliminate
Which of the factors that the industry takes for granted should be eliminated?