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Competitor Analysis for Getting Ahead in the Market
 

Competitor Analysis for Getting Ahead in the Market

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Understanding Your Competitors

Understanding Your Competitors

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Competitor Analysis for Getting Ahead in the Market Competitor Analysis for Getting Ahead in the Market Presentation Transcript

  • Understand Your Opponents COMPETITOR ANALYSIS
  • Agenda  Identifying Competitors  Sizing up Competitors  Understanding The Five Forces that make Markets Attractive or Unattractive Competitor Analysis 2
  •  If you know the enemy and know yourself, you need not fear the result of a hundred battles.  If you know yourself but not the enemy, for every victory gained you will also suffer a defeat.  If you know neither the enemy nor yourself, you will succumb in every battle. - Sun Tzu Competitor Analysis 3
  • SKF & Competition in 2009 25 2009 2500 20 2009 22 21 15 14 2000 10 13 10 5 6 Rs. Crores 1500 SALES 09 Cr Mkt Cap Cr 1000 % Sales Grwth (%) 0 ABC FAG -3 SKF TIMKEN RONW (%) -5 -10 500 -15 -20 0 ABC FAG SKF TIMKEN -22 -25 Competitor Analysis 4
  • Competitor Analysis> Key Questions  Where are you competing?  Who are your competitors?  How attractive is the competitive arena? Competitor Analysis 5
  • Competitor Analysis> Some Arenas are Static others, Dynamic Fruitflies Mammals Reptiles 10 days 70 years 200 years - Dynamic Cellphones - Static Autos Mining Competitor Analysis 6
  • Hallmarks of A Dynamic Market  Numerous products and services addressing a similar need (e.g., land line phones, cell phones, internet phone service, IM, e-maim)  A diversity of competitors ( e.g., TV networks, cable companies, video rental shops, live venues)  Few insurmountable barriers to entry  Market fragmentation Competitor Analysis 7
  • Who Are Your Competitors? (1/3) Film Camera Film Digital Camera Minolta Kodak Sony Canon Fuji HP Olympus Gateway Nikon Casio Competitor Analysis 8
  • Who Are Your Competitors? (2/3) Think about existing and potential competitors.  A competitor is any company that aims to satisfy the same customer needs that you do.  A customer does not want a ¼” drill - He wants a ¼” hole. Who’s the biggest manufacturer of digital cameras? - Sony or Canon? Answer: Neither. It is Nokia. Competitor Analysis 9
  • Who Are Your Competitors? (3/3) As you list your competitors, consider the foll:  Other players offering products similar to yours  Companies that make substitutes for your products  The ease with which customers comparisonshop and switch suppliers  Your own suppliers’ ability to raise their prices or reduce the quality of their offerings. Competitor Analysis 10
  • Characteristics for Competitor Analysis (1/5) 1. Strategies & Objectives 3. Strengths & Weaknesses 2. Positioning 4. The Aggression Factor Competitor Analysis 11
  • Characteristics for Competitor Analysis (2/5) 1. Strategies & Objectives Ref: Treacy & Wiersema Competitor Analysis 12
  • Characteristics for Competitor Analysis (3/5) 2. Positioning Creating a similar plot for your industry will give you a better idea of the competition. Competitor Analysis 13
  • Characteristics for Competitor Analysis (4/5) 3. Strengths & Weaknesses: Think Resources & Competencies Rate Relative Strengths Co. A Co. B Our Co. New-Prod Dynamism 8v 4= 9- Product Quality 8v 9= 7+ Distribution 6= 10 = 5= Customer Service 3+ 7= 5= Customer Satisfaction 7v 6= 7+ ----------------------------- --- --- --- Strength 1-10; 10 is best. = No change + Getting better v Getting worse Competitor Analysis 14
  • Characteristics for Competitor Analysis (2/5) 4. The Aggression Factor How We & Competitors React Aggressive offense Co. A Co. B X Aggressive defense Slow in defensive response X X Willing to cut prices to attack or defend Will match promotions Our Co. ? X X X X X X indicates propensity to the actions in left. Competitor Analysis 15
  • Porter’s Five Forces Framework Competitor Analysis 16
  • Summing Up (1/2)  The starting point of competitive analysis is the identification of competitors – tomorrow’s as well as today’s.  Determine the strategies and objectives of your competitors.  To better understand where key competitors are concentrating their product development and marketing efforts, create a positioning map. Competitor Analysis 17
  • Summing Up (2/2)  Develop a “relative strengths” table to rate the strengths and weaknesses of each competitor on key market dimensions (quality, distribution etc) . Be sure to indicate the apparent trajectory of these market players on these dimensions.  Determine how each key competitor reacts to moves by you and other firms. Is it slow to react? Is it aggressive in the offense? Will it fight hard to defend its turf? Competitor Analysis 18
  • Competitor Analysis 19
  • Exercise - Time limit:30 mins Decide on a couple of key competitors for a BU Group 1 Determine Strategy & Objectives of 1 or 2 key competitors Group 2 Create a Price/ Performance positioning map for your key products. Show key competitor products Group 3 Develop a relative strengths table of your BU and a couple of key competitors Group 4 Determine how each key competitor reacts to moves by your BU and other competitors- The Aggression Factor Competitor Analysis 20
  • Competitor Analysis 21