Offensive and Defensive strategies

1. Defensive & Offensive Strategies
S.P.K.Iresha
SH/2807

2. History of warfare strategies
 In the 1980s business strategists realized that there was a vast knowledge
base stretching back thousands of years that they had barely examined.
 They turned to military strategy for guidance.
 Military strategy books like “The Art of War” by Sun Tzu, “On War” by Von
Clausewitz and “The Little Red Book “ by Mao Zedong became business
classics.
 The first major proponents of marketing warfare theories was Philip Kotler
and
J. B. Quinn.
 The main marketing warfare books were,
• Business War Games by Barrie James, 1984
• Marketing Warfare by Al Ries and Jack Trout, 1986
• Leadership Secrets of Attila the Hun by Wess Roberts, 1987

3. Offensive & Defensive Strategies
 Offensive strategy is focused on
achieving competitive advantage.
 Defensive strategy is focused on
attacking the competitor in order to take
him off.

4.  Offensive strategic
market plans are
usually growth
oriented.
 Defensive strategic
market plans are more
likely to be
implemented in the
latter stages of a
product-market life
cycle.

5. Defensive Strategy
Defensive marketing strategies
refer to the actions of a market leader
to protect its market share,
profitability, product positioning, and
mind share against an emerging
competitor.

6.  Primary Purpose is to make possible attacks unattractive or
discourage competitors.
 It is a developed to protect market share, position and
profitability.
 It is a strategy that can be used to keep up top position in local
and existing market.
 This strategy is most successful to keep up the customer’s
confidence which no new competitor can disturb.

7. Types of Defensive strategy
Attacker 1.Position
defense
2.Flankin
g
Defense
Defender
3.Preemptive
defense
4.Counter
offensive
defense
6.Contractio
n defense
5.Mobile
defense

8. Position Defense
 The position defense is the simplest defensive strategy.
 It simply involves trying to hold the current position in the market.
 To do this, simply continue to invest in the current markets and
attempt to build brand name and customer loyalty.
 Only negative aspect of this strategy is that it can make a target
for new entrants to the market.
Eg: Mercedes was using a position defense strategy until
Toyota
launched a frontal attack with its Lexus.

9. Flanking Defense
 Defending the market share by entering new market and
diversification.
 If you lose your market share in the existing market you can make
up for it in these new markets.
 Negative aspect is that there are chances of losing main focus.

10. Pre-emptive Defense
 This strategy involves attacking a competitor before you can
get attacked by it.
 A company can launch a preemptive defense by several ways.
 It can wage guerrilla action across the market- hitting one
competitor here, another there and keep every one off balance;
or
it can try to achieve grand market envelopment where it
launches
attacks on all market segments.

11. Counter-offensive defense
 The counter-offensive defense is a retaliatory strategy.
 When a competitor attacks your business, you strike back with your
own attack.
Eg: Toyota launched the Lexus to respond to Mercedes attack

12. Mobile Defense
 Making constant changes in the business.
 Involves new product introduction, entering new market or simply
making changes in existing products.
 Business must be flexible enough to adapt new environment.
Eg: ITC (Indian Tobacco Company) have diversified their
strategies and come into food products (brand
“Asirbaad”) and FMCG(Fast Moving Consumer Goods (brand
“VIVEL” ) and 5 star Hospitality (brand “SONAR BANGLA”)

13. Contraction Defense
 Least desirable defense because it involves retreating from markets.
 This allows you to redeploy your resources into other areas.
Eg: India’s TATA Group sold its soaps and detergents business
units to Unilever in 1993

14. Why Defensive Strategies?
 Retention of market share
 Raising the barriers of entry
 Long term contracts
 Intact reputation
 Market leadership

15. Offensive(attack) Strategy
An offensive strategy
provides a means for the new
business to hit the market strong
and establish a presence.

16.  Improving own position by taking away market share of
competitors
 Involves direct & indirect attacks
 Retaliatory in nature
Eg: Samsung vs. Apple

17. Types of Attack Strategies
Attacker Defender
5.Guerilla
Attack
4. Bypass Attack
2. Flanking Attack
1. Frontal
Attack
3. Encirclement Attack

18. Frontal Attack
 Attacking a competitor head-on
 It attacks the opponents strengths rather than the weaknesses.
 Attacking with similar products, price, quality, promotion & distribution
 Highly risky unless attacker has a clear advantage
Eg: -The Cola wars between Pepsi and Coke starting from the early
1900s is an example of frontal attack strategies.
-McDonald’s McCafes which are coffee joints are seen as a
direct frontal attack on Starbucks.

19. Flank Attack
 Attacking the competitor at the weak point or blind spot
 Less risky when compared with frontal attack
 Follows the path of least resistance where competitor is incapable
of defending
 A flank attack can be directed along two strategic dimensions,
-geographical
(by attacking area where the opponent is underperforming)
-segmental
(by identifying market needs which are not fulfilled by the
leaders)

20. Encirclement Attack
 Combination of frontal & flank attack
 Attacker must have superior resources
 Surrounding with various brands so as to make competitor
difficult to defend
 Defender’s attention gets spread across various products making
him harder to defend

21. Bypass Attack
 Also called leapfrog strategy
 Overtake the competitors by introducing new technologies
 Diversifying the products
 This strategy offers three lines of approach.
-diversifying into unrelated products,
-diversifying into new geographical markets
-leapfrogging into new technologies

22. Guerilla Attack
 Small hit-and-run attacks to destabilize the competitor
 Attacks take several forms
 It is common for the attack to take the form of price cuts and
promotional offers, calculated to gradually weaken the opponents
market power.

23. Why Offensive Strategies?
 Destabilize the leader
 Acquire market share
 Sales Boost
 Leapfrog the competitor

24. The “Cola War”
1915 Coca-Cola introduced its unique 6-1/2 ounce bottle that became
closely associated with the brand. The size and shape was just right to
fit the
hand, and this bottle and its association with Coca-Cola was a major
strength.
However, when Pepsi introduced a larger bottle for the same price as
the
smaller bottle of Coke, Coke did not have many options to respond.
Because
of the way the size and shape of the bottle fit the hand, it could not be
enlarged easily. Furthermore, the dispensing machines for Coke were
designed for nickels only, so the price could not easily be changed.
These weaknesses were a direct result of Coke's strength: the
challenger
should seek a weakness in the leader's strength.

25. The “beer war”
Schlitz was the top brand, but lost its lead to Budweiser in a close
battle.
Then Heineken entered the market as an import with a successful
flanking
attack, maintaining its import lead by following through with strong
advertising budgets. In the 1970's many brewers introduced light beers
as
line extensions.
Ries and Trout believe that the line extensions are unwise because the
extensions inadvertently flank a firm's own leading brand. This
happened to
Miller High Life after Miller Lite was introduced. Miller Lite was
successful,
but Miller High Life suffered as it lost its position in the mind of the
consumer as the working man's beer.

26. The “burger war”
McDonald's was the leader, and Burger King tried offensive maneuvers. The
moves
that were unsuccessful were those that extended the product line and that
copied
McDonald's. The campaigns that were successful differentiated Burger King
from
McDonald's. For example, “Have it your way” attacked a weakness in
McDonald's
consistent production line process that had the flip side of being inflexible. Even
more
successful were the advertisements emphasizing the fact that Burger King's
burgers
were flame-broiled while McDonald's were fried.
Wendy's successfully flanked McDonald's by targeting adults rather than
children,
offering adult-size portions and launching the highly successful “Where's the
beef?”
campaign.

27. The “computer war”
IBM became the market leader in the 1950's, and many other companies attempted to
emulate
IBM, but IBM continued to hold a majority market share. In the 1960's Digital Equipment
Corporation launched a successful flanking attack by introducing the PDP-8 minicomputer,
winning the position of small computers. According to Ries and Trout, IBM should have
blocked
this move by introducing their own minicomputer, but they failed to do so until 11 years
later.
With DEC owning the minicomputer market, Ries and Trout argue that DEC should have
been
the company to introduce the PC in the business market. DEC failed to do so, and IBM
launched
its PC in 1981 with virtually no competition in the business market. IBM effectively flanked
DEC
with a product in the small computer market, just as DEC had done to IBM 15 years
earlier.
Many companies introduced their own PC's but IBM pursued the defensive strategy that a
leader
should pursue by attacking itself, first with the improved PC-XT and then with the PC-AT.
While

28. “Do not assume the enemy will not come,
but be prepared for his coming…
Do not presume he will not attack,
but instead
make your own position
unassailable.”
“The Art of War”(Sun Tzu).
THANK YOU