Marketing Strategies for

Competitive Positions
 Definition
• Competitive Analysis

– The process of identifying key

competitors; assessing their
objectives, strategies, strengths
and weaknesses, and reaction
patterns; and selecting which
competitors to attack or avoid.
Types of Competitive Positions

Market Leaders

Market Challengers

Market
Followers
Nichers
Market Leaders
 Competitive Strategy
Competitive • Expanding the total demand
Positions – Finding new users
– Discovering and promoting new
product uses
• Market Leader – Encouraging greater product
usage
• Market Challenger • Protecting market share
– Many considerations
• Market Follower – Continuous innovation

• Market Nicher • Expanding market share

– Profitability rises with market
share
 Marketing Strategy

Market Leader Strategies

• Increase Size of Total Market

• Product-Market Growth
Strategies Market Share

• Protect Market Share

• Fortification
• Assortment of brands, 100%
sizes
• Innovation
• Best defense is a good
Marketing Effort ($)
offense
• Counteroffensive
 Designing Competitive
Strategies
• Expanding the Total Market:
– Targeting Product to New Users
• Market-penetration strategy
• New-market strategy
• Geographical-expansion strategy
– Promoting New Uses of Product
– Encouraging Greater Product Use
 Designing Competitive
Strategies
Defending Market Share

• Position • Counteroffensive
defense defense
• Flank defense • Mobile defense
• Preemptive defense • Contraction defense
 Expand
Expand Total
Total Market
Market
Kodak ----- New user, new uses, more uses

Arms and hammer’s baking soda, refrigerator demand and kitchen

grace fires

Michelin Tire (French) – French car owners to drive there car

more miles per year. More tire replacement
 Defend
Defend market
market Share
Share

Coca vs. Peps, Gillette vs. Bick,

Hertz vs. Avis
 Defense
Defense Strategy
Strategy

Vs.

Heinz ketchup market enjoy high market share Hunts

costly attack failed
 Flank
Flank Defense
Defense

Heublein’s brand Smirnoff attack by Wolf Schmidt

vodka. Smirnoff price rise by one dollar for the
advertising
 Market Leader Strategies

Position
Position Flanking
Flanking Preemptive
Preemptive
protect
fortification weakness guerrilla
create psychological
assault posts preventative

Market
Market Leader
Leader

Counteroffensive
Counteroffensive Mobile
Mobile Contraction
Contraction
fast, solid, broadening fronts strategic withdrawal
 Designing Competitive
Strategies
• Before Attempting to Expand Market
Share, Consider:
– Probability of invoking antitrust action
– Economic costs involved
– Likelihood that marketing mix decisions will
increase profits
 Competitive Strategy

Competitive • Option 1: challenge the

market leader
Positions – High-risk but high-gain
– Sustainable competitive
advantage over the leader is
• Market Leader key to success
• Market Challenger • Option 2: challenge firms of
the same size, smaller size or
• Market Follower challenge regional or local
firms
• Market Nicher • Full frontal vs. indirect attacks
 Designing Competitive
Strategies
• General Attack Strategies:
– Frontal attacks match competition
– Flank attacks serve unmet market needs or
underserved areas
– Encirclement “blitzes” opponent
– Bypassing opponent and attacking easier
markets is also an option
Market Challenger Strategies
Encirclement
Encirclement

Flanking
Flanking Bypass
Bypass

Frontal
Frontal Guerrilla
Guerrilla

Challenger
Challenger Strategies
Strategies
 Competitive Strategy

Competitive • Follow the market leader

Positions – Focus is on improving
profit instead of market
share
• Market Leader – Many advantages:
• Learn from the market
• Market Challenger leader’s experience
• Copy or improve on the
• Market Follower leader’s offerings
• Strong profitability
• Market Nicher
Market Follower Strategies

Cloner
Cloner

Imitator
Imitator

Adapter
Adapter
 Designing Competitive
Strategies
Specific Attack Strategies Include:
• Price-discount • Product
• Lower-price goods innovation
• Prestige goods • Distribution
innovation
• Improved services
• Manufacturing
• Product proliferation cost reduction
 Competitive Strategy

Competitive
Positions • Serving market niches means
targeting sub segments
• • Good strategy for small firms
Market Leader with limited resources
• Market Challenger • Offers high margins
• Specialization is key
• Market Follower – By market, customer,
product, or marketing mix
• Market Nicher lines
 Nicher Strategies for Advantage

End-Use Specialist Geographic Specialist

Vertical-Level Specialist Product/Feature Specialist

Customer-Size Specialist Quality-Price Specialist

Specific-Customer Specialist Service Specialist

What makes a Niche a Good Niche?

General Nicher - Rules

• Be satisfied being small.
• Stay stealthy, stay healthy.
• Don’t be myopic.
• The customer’s always right
but not always right for you.
• stick to niching but not
necessarily to your niche.