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Ch11 Dealing with Competition Concept Questions

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  • 1. TOP 10 Learning Questions for Chapter 11: Dealing with Competition Sherrylou M. Marzo September 15, 2011 http://sherryloumarzo.blogspot.com/
  • 2. 1. Threat of Intense Segment Rivalry will result to the following except:A. Price WarsB. Limited DistributionC. Advertising BattleD. New Product IntroE. None of the Above http://sherryloumarzo.blogspot.com/ 2
  • 3. Five Forces that Determine MarketStructure Threat of New Entrants Segment Rivalry BuyerSupplier Industry Competitors Power Power Threat of Michael Porter’s Substitutes 5 Forces http://sherryloumarzo.blogspot.com/ 3
  • 4. Segment is Unattractive if Threat ofRivalry is Intense This Happens When: • Fixed cost & Exit Barriers are high Segment Rivalry • Competitors have high Industry stakes in staying in Competitors the segment • Plant Capacity must be added in large increments http://sherryloumarzo.blogspot.com/ 4
  • 5. Threat of Intense Segment Rivalry will results to: Segment Rivalry Industry Competitors Advertising BattlePrice Wars New Product Intro http://sherryloumarzo.blogspot.com/ 5
  • 6. 1. Threat of Intense Segment Rivalry will result to the following except:A. Price WarsB. Limited DistributionC. Advertising BattleD. New Product IntroE. None of the Above http://sherryloumarzo.blogspot.com/ 6
  • 7. 2. _________ to your most successful competitor can improve competitive performanceA. ResearchingB. CompetingC. BenchmarkingD. SharingE. Differentiating http://sherryloumarzo.blogspot.com/ 7
  • 8. Three Variables in Analyzing Competitors Benchmarking to your most successful competitor can improve competitive performanceShare of Market http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 8
  • 9. Three Variables in AnalyzingCompetitors % of Customers who named the competitor in respond to this statement: “Name the 1st company that comes to mind in this industry?” Share of Mind http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 9
  • 10. Three Variables in AnalyzingCompetitors % of Customers who named the competitor in respond to this statement: “Name the company from which you would prefer to buy the product Share of Heart http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 10
  • 11. Three Variables in Analyzing CompetitorsShare of Market Share of Mind Share of Heart http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 11
  • 12. 2. _________ to your most successful competitor can improve competitive performanceA. ResearchingB. CompetingC. BenchmarkingD. SharingE. Differentiating http://sherryloumarzo.blogspot.com/ 12
  • 13. 3. Which Statement is True?A. Good competitors set prices in reasonable relationship to priceB. Bad competitors try to buy shares than earn it.C. Good competitors take large risksD. Bad competitors invest in under capacityE. Good competitors still upset industrial equilibrium http://sherryloumarzo.blogspot.com/ 13
  • 14. Selecting Competitors Classes of CompetitorsStrong vs. Weak Good vs. Bad Close vs. Distant http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 14
  • 15. Classes of CompetitorsGood competitors: Bad Competitors:• Play by the • Try to buy industry’s rules shares than• They set prices earn it. in reasonable • Take large risks relationship to • Invest in over- cost. capacity.• They favor a • Upset industrial healthy industry. equilibrium Good vs. Bad http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 15
  • 16. Bad Competitors fast tracks everything and instead of earning its shares they would rather buy sharesGood competitors: Bad Competitors:• Play by the • Try to buy industry’s rules shares than• They set prices earn it. in reasonable • Take large risks relationship to • Invest in over- cost. capacity.• They favor a • Upset industrial healthy industry. equilibrium Good vs. Bad http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 16
  • 17. 3. Which Statement is True?A. Good competitors set prices in reasonable relationship to priceB. Bad competitors try to buy shares than earn it.C. Good competitors take large risksD. Bad competitors invest in under capacityE. Good competitors still upset industrial equilibrium http://sherryloumarzo.blogspot.com/ 17
  • 18. 4. Market Leaders leads other Firms in the following except:A. Price ChangesB. New Product IntroC. Distribution CoverageD. Promotional IntensityE. Competitive Insights http://sherryloumarzo.blogspot.com/ 18
  • 19. Characteristics of a MarketLeaders • The firm with the largest market share. http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 19
  • 20. Characteristics of a Market Leaders Market Price Changes Distribution Coverage Leaders Leads other Firms inNew Product Intro Promotional Intensity http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 20
  • 21. 4. Market Leaders leads other Firms in the following except:A. Price ChangesB. New Product IntroC. Distribution CoverageD. Promotional IntensityE. Competitive Insights http://sherryloumarzo.blogspot.com/ 21
  • 22. 5. _________ is an attempt to capture a wide slice of enemy’s territory through a blitz.A. Encircle AttackB. Flank AttackC. Frontal AttackD. Bypass AttackE. Guerrilla Warfare Attack http://sherryloumarzo.blogspot.com/ 22
  • 23. General Attack Strategies Frontal Attack Flank AttackEncirclement Attack Bypass Attack Guerrilla Warfare http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 23
  • 24. General Attack Strategies • Matches the opponent’s Frontal Attack product, advertising, price, distribution distribution AdvertisementProduct Price http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 24
  • 25. General Attack Strategies • An Enemy’s weak spots areFlank Attack natural targets Weak Spot http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 25
  • 26. General Attack Strategies • An attempt to capture aEncirclement Attack wide slice of enemy’s territory through a blitz. To capture a slice http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 26
  • 27. General Attack Strategies • Bypassing the enemyBypass Attack altogether and attacking easier markets to broaden the firm’s resource base. http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 27
  • 28. General Attack Strategies • Consists of waging small,Guerilla Warfare intermittent, attacks to harass and demoralize the opponent & eventually secure permanent footholds. http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 28
  • 29. Encircle Attack usually gets a portion of its competitors share Frontal Attack Flank AttackEncirclement Attack Bypass Attack Guerrilla Warfare http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 29
  • 30. 5. _________ is an attempt to capture a wide slice of enemy’s territory through a blitz.A. Encircle AttackB. Flank AttackC. Frontal AttackD. Bypass AttackE. Guerrilla Warfare Attack http://sherryloumarzo.blogspot.com/ 30
  • 31. 6. Samurai Energy Drink to Cobra Energy Drink is an example of what kind of Market Follower Strategy?A. ClonerB. ImitatorC. AdapterD. InnovatorE. Counterfeiter http://sherryloumarzo.blogspot.com/ 31
  • 32. Market Follower StrategiesCounterfeiter Imitator Adapter Cloner http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 32
  • 33. Market Follower Strategies • Duplicates the leader’s product and packages and sells it on the black market or through disreputable dealersCounterfeiter http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 33
  • 34. Market Follower Strategies • Emulates the leader’s products, name, and packaging with slight variationCloner http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 34
  • 35. Market Follower Strategies • Copies some things from the leader but maintains differentiation in terms of packaging, advertising, pricing, or location. Imitator http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 35
  • 36. Market Follower Strategies • Takes the leader’s products and adapts or improves them Adapter http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 36
  • 37. Samurai Energy Drink as an Imitator to Cobra Energy Drink • Copied the packaging, color, and size but is price a little lower than CobraSamurai Energy Cobra Energy Drink Drink http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 37
  • 38. 6. A Market Follower Strategy that duplicates the leader’s product and packages and sells it on the black market or through disreputable dealersA. ClonerB. ImitatorC. AdapterD. InnovatorE. Counterfeiter http://sherryloumarzo.blogspot.com/ 38
  • 39. 7. The following are Asia Brewery’s Absolute Distilled Water Competitors Based on Industry Point of View except?A. Coca Cola PhilippinesB. Philippine Spring WaterC. Pepsi Cola PhilippinesD. Universal Robina CorporationE. Nestle Philippines http://sherryloumarzo.blogspot.com/ 39
  • 40. Identifying Competitors Competition Industry is a group of firms that offer a product or class of products that are close substitutes for one another.From Industry http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 40
  • 41. Identifying Competitors CompetitionFrom Industry From market point of view Using the market approach, competitors are companies that satisfy the same customer need. http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 41
  • 42. All of these competitors belongs to the Beverage Industry. Nestle Phil does not belong to the beverage category Pepsi Cola PhilippinesCoca Cola Philippines http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 42
  • 43. 7. The following are Asia Brewery’s Absolute Distilled Water Competitors Based on Industry Point of View except?A. Coca Cola PhilippinesB. Philippine Spring WaterC. Pepsi Cola PhilippinesD. Universal Robina CorporationE. Nestle Philippines http://sherryloumarzo.blogspot.com/ 43
  • 44. 8. Intensive advertising promotion of Absolute Distilled Water is an example of what kind of strategy?A. Specific Attack StrategyB. General Attack StrategyC. Market Nicher StrategyD. Market Follower StrategyE. Competitive Strategy http://sherryloumarzo.blogspot.com/ 44
  • 45. Specific Attack Strategies Price Discounts Product Proliferation Lower- Priced GoodsValue- Priced Goods Prestige Goods http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 45
  • 46. Specific Attack Strategies Distribution InnovationProduct Innovation Improved Services Manufacturing Cost Intensive advertising Reduction promotion http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 46
  • 47. Specific Attack Strategies of Absolute Distilled Water Price DiscountsValue- Priced Goods Intensive advertising promotion http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 47
  • 48. 8. Intensive advertising promotion of Absolute Distilled Water is an example of what kind of strategy?A. Specific Attack StrategyB. General Attack StrategyC. Market Nicher StrategyD. Market Follower StrategyE. Competitive Strategy http://sherryloumarzo.blogspot.com/ 48
  • 49. 9. Which of the following is an example of a close competitor to Asia Brewery’s Cobra Energy Drink?A. Pepsi’s GatoradeB. Coca Cola’s Royal True OrangeC. URC’s C2D. Pepsi’s StingE. Wilkin’s Distilled Water http://sherryloumarzo.blogspot.com/ 49
  • 50. Selecting Competitors Classes of CompetitorsStrong vs. Weak Good vs. Bad Close vs. Distant http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 50
  • 51. Classes of Competitors• Most companies compete with the competitors that resemble them the most.• But one should still identify their distant competitors. Close vs. Distant http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 51
  • 52. Both Cobra and Sting are close competitors because they belong the Energy Drink Category Close DistantSting (Energy Drink) Gatorade (Sports Drink) http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 52
  • 53. Market Follower StrategiesCounterfeiter Imitator Adapter Cloner http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 53
  • 54. Market Follower StrategiesCounterfeiter Imitator Adapter Cloner http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 54
  • 55. Market Follower StrategiesCounterfeiter Imitator Adapter Cloner http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 55
  • 56. Market Follower StrategiesCounterfeiter Imitator Adapter Cloner http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 56
  • 57. 9. Which of the following is an example of a close competitor to Asia Brewery’s Cobra Energy Drink?A. Pepsi’s GatoradeB. Coca Cola’s Royal True OrangeC. URC’s C2D. Pepsi’s StingE. Wilkin’s Distilled Water http://sherryloumarzo.blogspot.com/ 57
  • 58. 10. Which of the following is TrueA. Market Follower defines growth path and invite competitive retaliationB. Market Follower usually keeps manufacturing costs lowC. Market Follower bring distinction to its competitorsD. Market Follower do not imitate the leader but only improves the productE. Market Follower has gained ground or even overtaken the leaders http://sherryloumarzo.blogspot.com/ 58
  • 59. Other Competitive Strategies Market Followers Market Market NichersChallengers http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 59
  • 60. Other Competitive Strategies • They have gained ground or even overtaken the leader. • They have high aspirations • They leverage their resources MarketChallengers http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 60
  • 61. Other Competitive Strategies • They usually imitate the leader by Market improving the product.Followers • They bring distinction to its target market • They usually keep manufacturing costs low & its product quality and services high. • They define growth path but does not invite competitive retaliation http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 61
  • 62. Other Competitive Strategies • They are the leader in the small markets. • They avoid competing with larger firmsMarketNichers http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 62
  • 63. They have a low manufacturingcost so that they can easily followthe market leader • They usually imitate the leader by Market improving the product.Followers • They bring distinction to its target market • They usually keep manufacturing costs low & its product quality and services high. • They define growth path but does not invite competitive retaliation http://sherryloumarzo.blogspot.com/ http://sherryloumarzo.blogspot.com/ 63
  • 64. 10. Which of the following is TrueA. Market Follower defines growth path and invite competitive retaliationB. Market Follower usually keeps manufacturing costs lowC. Market Follower bring distinction to its competitorsD. Market Follower do not imitate the leader but only improves the productE. Market Follower has gained ground or even overtaken the leaders http://sherryloumarzo.blogspot.com/ 64
  • 65. TOP 10 Learning Questions for Chapter 11: Dealing with Competition Sherrylou M. Marzo September 15, 2011 http://sherryloumarzo.blogspot.com/