Creating  Competitive Advantage

Creating Competitive Advantage PowerPoint PPT Presentation


  • 112 Views
  • Uploaded on
  • Presentation posted in: General

18- 1. Objectives. Learn how to understand competitors as well as customers via competitor analysis.Learn the fundamentals of competitive marketing strategies based on creating value for customers.Realize the need for balancing customer and competitor organizations in order to become a truly mark

Download Presentation

Creating Competitive Advantage

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -

Presentation Transcript


1. Creating Competitive Advantage Chapter 18

2. 18- 1 Objectives Learn how to understand competitors as well as customers via competitor analysis. Learn the fundamentals of competitive marketing strategies based on creating value for customers. Realize the need for balancing customer and competitor organizations in order to become a truly market-centered organization.

3. 18- 2 Has dominated the chip industry Success is directly related to Intel’s competitive strategy Strategy focuses on superior value and product leadership Heavy focus on product and advertising innovation and R&D investments Changing market needs have challenged Intel to adapt Intel is capitalizing on the Internet now

4. 18- 3 Definition Competitive Advantage An advantage over competitors gained by offering consumers greater value than competitors offer.

5. 18- 4 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.

6. 18- 5

7. 18- 6 Competitor Analysis Firms face a wide range of competition Be careful to avoid “competitor myopia” Methods of identifying competitors: Industry point-of-view Market point-of-view Competitor maps can help

8. 18- 7

9. 18- 8

10. 18- 9

11. 18- 10 Competitor Analysis Determining competitors’ objectives Identifying competitors’ strategies Strategic groups Assessing competitors’ strengths and weaknesses Benchmarking Estimating competitors’ reactions

12. 18- 11 Competitor Analysis Strong or weak competitors Customer value analysis Close or distant competitors Most companies compete against close competitors “Good” or “Bad” competitors The existence of competitors offers several strategic benefits

13. 18- 12 Basic Winning Competitive Strategies: Porter Overall cost leadership Lowest production and distribution costs Differentiation Creating a highly differentiated product line and marketing program Focus Effort is focused on serving a few market segments Competitive Strategies

14. 18- 13

15. 18- 14 Basic Competitive Strategies: Value Disciplines Operational excellence Superior value via price and convenience Customer intimacy Superior value by means of building strong relationships with buyers and satisfying needs Product leadership Superior value via product innovation Competitive Strategies

16. 18- 15

17. 18- 16 Competitive Strategy Expanding the total demand Finding new users Discovering and promoting new product uses Encouraging greater product usage Protecting market share Many considerations Continuous innovation Expanding market share Profitability rises with market share

18. 18- 17 Competitive Strategy Clicking the WWW icon will open your web browser and link to the web site pictured in the screen shot.Clicking the WWW icon will open your web browser and link to the web site pictured in the screen shot.

19. 18- 18 Competitive Strategy Option 1: challenge the market leader High-risk but high-gain Sustainable competitive advantage over the leader is key to success Option 2: challenge firms of the same size, smaller size or challenge regional or local firms Full frontal vs. indirect attacks

20. 18- 19

21. 18- 20 Competitive Strategy Follow the market leader Focus is on improving profit instead of market share Many advantages: Learn from the market leader’s experience Copy or improve on the leader’s offerings Strong profitability

22. 18- 21

23. 18- 22 Competitive Strategy Serving market niches means targeting subsegments Good strategy for small firms with limited resources Offers high margins Specialization is key By market, customer, product, or marketing mix lines

24. 18- 23 Companies can become so competitor centered that they lose their customer focus. Types of companies: Competitor-centered companies Customer-centered companies Market-centered companies Balancing Customer and Competitor Orientations

25. 18- 24 Game playing industry Nintendo Wii hyperlink Microsoft Xbox 360 Sony Play Station

26. 18- 25

27. 18- 26 Threat of New Entry the existence of barriers to entry economies of product differences brand equity switching costs capital requirements access to distribution absolute cost advantages learning curve advantages expected retaliation government policies

28. 18- 27 Competitive Rivalry number of competitors rate of industry growth intermittent industry overcapacity exit barriers diversity of competitors informational complexity and asymmetry brand equity fixed cost allocation per value added level of advertising expense

29. 18- 28 Supplier Power supplier switching costs relative to firm switching costs degree of differentiation of inputs presence of substitute inputs supplier concentration to firm concentration ratio threat of forward integration by suppliers relative to the threat of backward integration by firms cost of inputs relative to selling price of the product

30. 18- 29 Buyer Power buyer concentration to firm concentration ratio bargaining leverage buyer volume buyer switching costs relative to firm switching costs buyer information availability ability to backward integrate availability of existing substitute products buyer price sensitivity price of total purchase

31. 18- 30 Threat of Substitution buyer propensity to substitute relative price performance of substitutes buyer switching costs perceived level of product differentiation

  • Login