Chapter

12
Addressing
Competition and
Driving Growth

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Learning Objectives
1. Why is it important for companies to grow the core of
their business?
2. How can market leaders expand the total market and
defend market share?
3. How should market challengers attack market
leaders?
4. How can market followers or nichers compete
effectively?
5. What marketing strategies are appropriate at each
stage of the product life cycle?
6. How should marketers adjust their strategies and
tactics during slow economic growth?
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 Growth strategies
Building your market International expansion
share Acquisitions, mergers,
Developing committed and alliances
customers and Building an outstanding
stakeholders reputation for social
Building a powerful brand responsibility
Innovating new products, Partnering with
services, and government and NGOs
experiences

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 Growing the Core

Make the core of the brand as

distinctive as possible

Drive distribution through both

existing and new channels

Offer the core product in new formats

or versions

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 Competitive Strategies
for Market Leaders
Expanding total market
demand

Protecting market share

Increasing market share

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Expanding total market demand
New customers
More usage

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 Protecting market share

Proactive
marketing
Responsive
anticipation
Creative
anticipation

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 Protecting market share
Defensive marketing

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 Increasing market share
The cost of buying higher market share
through acquisition may far exceed its
revenue value
Possibility of provoking
Economic cost
antitrust action

Pursuing wrong Increased market share

marketing activities effect on quality

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 Figure 12.3
Optimal Market Share

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 MARKET-CHALLENGER
STRATEGIES
Defining the strategic objective and
opponent(s)

A market challenger can attack:

The market leader
Underfunded firms its own size
Small local and regional firms
The status quo

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 MARKET-CHALLENGER
STRATEGIES
Choosing a general attack strategy

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Market-Follower Strategies

Cloner

Imitator

Adapter

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 MARKET-NICHER
STRATEGIES
To be a leader in a
small market
Firms with low shares
of the total market
can become highly
profitable through
smart niching

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 Niche Specialist Roles

Vertical-
End-user
level
specialist
specialist

Customer-
Channel size
specialist specialist

Job-shop Geographic
specialist specialist

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 PRODUCT LIFE-CYCLE
MARKETING STRATEGIES
A companys
positioning and
differentiation
strategy must change
as its product,
market, and
competitors change
over the PLC

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 Figure 12.6
Common Product Life-Cycle
Patterns

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 Figure 12.7
Style, Fashion, And Fad Life Cycles

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 Marketing Strategies: Introduction
Stage
Pioneering advantages
Recall of brand name
Establishes product class attributes
Captures more uses in middle of market
Pioneering drawbacks
Imitators can surpass innovators
Once leadership is lost, its rarely regained

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 Figure 12.8
Long-Range Product Market
Expansion Strategy

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 Marketing Strategies: Growth
Stage
To sustain rapid market share growth now:
Improve product quality and add new features
Add new models and flanker products
Enter new market segments
Increase distribution coverage and enter new
distribution channels
Shift from awareness and trial communications to
preference and loyalty communications
Lower prices to attract the next layer of price-sensitive
buyers

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Marketing Strategies: Maturity
Stage

Market modification

Product modification

Marketing program
modification

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Market Modification

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 Marketing Strategies: Decline
Stage
Eliminating Weak
Products

Harvesting and
Divesting

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Marketing in a Slow-Growth
Economy
Explore upside of increasing investment
Get closer to customers
Review budget allocations
Put forth compelling value proposition
Fine-tune brand and product offerings

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Copyright 2016 Pearson Education Ltd. 12-26