Marketing strategies

1. Competitive Strategy

2. Introduction
• Having a competitive advantage is necessary for a
firm to compete in the market
• But what is more important is whether the
competitive advantage is sustainable
• A firm must identify its position relative to the
competition in the market
• By knowing if it is a leader, challenger, follower or
nicher, it can adopt appropriate strategies to
compete

3. Sustainable Competitive
Advantage
• Aaker suggested looking at the
following:
– How you compete ?
– Basis of competition ?
– Where you compete ?
– Whom you are competing against ?

4. Building strategies
• Offensive strategies (Overt offensive,
covert offensive)
• Defensive strategies

5. • Overt-offensive strategy
– To knock out a business rival so as to take
over his company
– To knock out a competing product so as to
take over its market share
• Covert-offensive strategy
– Keep as low a profile as possible while
making offensive moves

6. Strategies for Market Leaders
Market Leader’s objectives:
• Expand the total market
-Finding new users
– Creating new uses, and
– Encouraging more usage
• Protect its current market share
– Adopting defense strategies
– Increase its market share

7. Which strategy to use?
Depends on your answer to the following:
• Is it worth fighting?
• Are you strong enough to fight?
• How strong is your defense?
• Do you have any choice but to fight?

8. Market Challenger Strategies
The market challengers’ strategic
objective is to gain market share and to
become the leader eventually
How?
• By attacking the market leader
• By attacking other firms of the same
size
• By attacking smaller firms

9. Market-Follower Strategies (cont’d)
• Each follower tries to bring distinctive
advantages to its target market--
location, services, financing

10. Market-Nicher Strategies
• Smaller firms can avoid larger firms by
targeting smaller markets or niches
that are of little or no interest to the
larger firms
e.g. Logitech--mice
Microbrewers--special beers

11. Market-Nicher Strategies
(cont’d)
• Nichers must create niches, expand the
niches and protect them
– e.g. Nike constantly created new niches--
cycling, walking, hiking, cheerleading, etc
• What is the major risk faced by nichers?
– Market niche may be attacked by larger
firms once they notice the niches are
successful

12. Strategies for the leader
• Pre-emptive
• Defensive
• Counter offensive

13. Strategies for the
challenger
• Price discount strategy
• Cheaper goods strategy
• Prestige goods strategy
• Product proliferation strategy
• Product innovation strategy
• Improved services strategy
• Distribution innovation strategy
• Cost reduction strategy
• Intensive promotion strategy

14. Strategies for the
follower
• Counterfeit product strategy (duplicate
products)
• Cloner products strategy (copy leaders
product, package etc.)
• Adapter strategy
• Imitator products strategy ( using
leaders products but adding a little
differentiation)