Dealing

with Competition
9
Marketing Management
A South Asian Perspective, 13
th
ed
Copyright 2009 Dorling Kindersley (India) Pvt. Ltd. 9-2
Chapter Questions
How do marketers identify primary
competitors?
How should we analyze competitors
strategies, objectives, strengths, and
weaknesses?
How can market leaders expand the
total market and defend market share?
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Chapter Questions (cont.)
How should market challengers attack
market leaders?
How can market followers or nichers
compete effectively?

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Mobile service
providers
compete with
each other
through
innovative
marketing ideas
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Figure 9.1 Five Forces Determining
Segment Structural Attractiveness
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Identifying Competitors
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Industry Concept of Competition
Number of sellers and degree of
differentiation
Entry, mobility, and exit barriers
Cost structure
Degree of vertical integration
Degree of globalization
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Figure 9.2 Strategic Groups
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Figure 9.4 A Competitors
Expansion Plans
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Table 9.1 Customer Ratings of
Competitors on Key Success Factors
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Strengths and Weaknesses
Share of market
Share of mind
Share of heart
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Steps in Benchmarking
Determine which functions or
processes to benchmark
Identify the key performance variables
to measure
Identify the best-in-class companies
Measure the performance of best-in-
class companies
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Steps in Benchmarking (cont.)
Measure the companys performance
Specify programs and actions to close
the gap
Implement and monitor results

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Fake brands in Rural Markets
Look-alike
Spell-alike
Duplicates
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Figure 9.5
Hypothetical Market Structure
10%
Market
Nichers
20%
Market
Follower
30%
Market
Challenger
40%
Market
Leader
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Gap Tried to Appeal to
Too Broad a Market
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Expanding the Total Market
New customers
More usage
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Figure 9.6 Six Types of
Defense Strategies
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Figure 9.7
Optimal Market Share
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Factors Relevant to Pursuing
Increased Market Share
Possibility of provoking antitrust action
Economic cost
Pursuing the wrong marketing-mix
strategy
The effect of increased market share on
actual and perceived quality
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Other Competitive Strategies
Market
Challengers
Market
Nichers
Market
Followers
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Market Challenger Strategies
Define the strategic objective and
opponents
Choose a general attack strategy
Choose a specific attack strategy
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In Sri Lanka, Tapal has challenged
Unilever to emerge as a serious
competitor
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General Attack Strategies
Frontal Attack
Encirclement
Attack
Bypass Attack
Flank Attack
Guerrilla Warfare
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Pepsi buys Gatorade in a
Bypass Strategy
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Specific Attack Strategies
Price discounts
Lower-priced goods
Value-priced goods
Prestige goods
Product proliferation
Product innovation
Improved services
Distribution
innovation
Manufacturing-cost
reduction
Intensive advertising
promotion
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Market Follower Strategies
Counterfeiter
Cloner
Imitator
Adapter
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Market Nicher Strategies
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Niche Specialist Roles
End-User Specialist
Vertical-Level
Specialist
Customer-Size
Specialist
Specific-Customer
Specialist
Geographic
Specialist
Product-Line
Specialist
Job-Shop Specialist
Quality-Price
Specialist
Service-Specialist
Channel Specialist
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Balancing Orientations
Competitor-
Centered
Customer-
Centered
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Marketing Debate
How do you attack a category leader?

Take a position:
1. The best way to challenge a leader is to
attack its strengths.

or

2. The best way to attack a leader is
to avoid a head-on assault and to adopt
a flanking strategy.
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Marketing Discussion
Pick an industry.
Classify firms according to the
four different roles they might play.
How would you characterize the
nature of competition?
Do the firms follow the principles
described in this chapter?