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Competitor Analysis. Ted Mitchell. Three Main Topics. 1 Analysis of Industry Strategic Environment 2 Competitive Bench Marking (Comparative) 3 Competitive Advantage. Porter Strategic Forces. Ease of Market Entry and Exit Buyer or Seller Power Bargaining Power Competitive Rivalry

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Presentation Transcript
Competitor analysis

Competitor Analysis

Ted Mitchell


Three main topics
Three Main Topics

  • 1 Analysis of Industry Strategic Environment

  • 2 Competitive Bench Marking (Comparative)

  • 3 Competitive Advantage


Porter strategic forces
Porter Strategic Forces

  • Ease of Market Entry and Exit

  • Buyer or Seller Power

    • Bargaining Power

  • Competitive Rivalry

    • Chicken or Prisoner’s Dilemma


Classic economic description of an industry
Classic Economic Description of An Industry

  • Monopoly

  • Oligopoly

  • Monopolistic

  • Pure Competition


Market definition of competition
Market Definition of Competition

  • Business seeking to serve the same need in different ways.

    • All the people who are providing solutions to the people who need a solution are competitors

    • Hole Industry---Drills, punches presses, flame jets, blow torch, hammers, ….. Etc.

    • Communication Industry --- Airlines, telegraphs, telephone, stamp, e-mail,


Customer Centered

Customer

Orientation

Product

Orientation

Industry

Orientation

Competitor

Orientation

Yes

No

No

Competitor Centered

Yes


Competitive analysis
Competitive Analysis

Identifying

Competitors

Determining

Objectives

Identifying

Strategies

Assessing

Strengths/Weaknesses

Estimating

Reaction Patterns

Selecting Those

To Attack/Avoid


Competitive description
Competitive Description

By Their

  • Strategies

  • Objectives

  • Strengths and Weaknesses (as objective as possible)

    • Share of Market

    • Share of Voice

    • Share of Wallet

  • Types of Reactions


COMBINING CHOICES INTO FOUR STRATEGY STATEMENTS

Current Market

New Market

Current Product

MARKET

DEVELOPMENT

STRATEGY

PENETRATION

STRATEGY

New Product

PRODUCT DEVELOPMENT STRATEGY

DIVERSIFICATION STRATEGY

TJM


Flanking

Market Leader

Position

Preemptive

Counteroffensive

Contraction

Mobile


Market follower strategies

Encirclement

Market Follower Strategies

Flanking

Bypass

Challenger Strategies

Frontal

Guerrilla


Game theory
Game Theory

  • The Ultimate Model for the Study of Marketing Competition and Competitive Based Strategy


In most books almost no discussion of
In Most books almost no discussion of

  • No Game Theory (Kotler is one of the first to apply to marketing)

  • No policies or plans for reacting to the competitors!


Prisoner s dilemma
Prisoner’s Dilemma

G.M.’s choices of price level

Ford’sValues

High

Low

High

3 ,

1 ,

Ford’s choices of price level

4 ,

2 ,

Low


Prisoner s dilemma1
Prisoner’s Dilemma

G.M.’s choices of price level

G.M.’s Values

High

Low

High

3 , 3

1 , 4

Ford’s choices of price level

4 , 1

2 , 2

Low


Chicken
Chicken

G.M.’s choices of price level

Ford’sValues

High

Low

High

3 ,

2 ,

Ford’s choices of price level

4 ,

1 ,

Low


Chicken1
Chicken

G.M.’s choices of price level

G.M.’s Values

High

Low

High

3 , 3

2 , 4

Ford’s choices of price level

4 , 2

1 , 1

Low


Store entry game
Store Entry Game

Do NOT Enter Market

New Store Choices

Enter The Market

Old StoreValues

Market Sharing

Status Quo

Market Sharing

3 ,

2 ,

Old Store choices of Reaction Policies

Status Quo

Price War

3 ,

1 ,

PriceWar


Store entry game1
Store Entry Game

Do NOT Enter Market

New Store Choices

Enter The Market

New StoreValues

Market Sharing

Status Quo

Market Sharing

3 , 2

2 , 3

Old Store choices of Reaction Policies

Status Quo

Price War

3 , 2

1 , 1

PriceWar


Competitive comparison
Competitive Comparison

  • Benchmarking

    • Do it from the Customer’s Point of View

    • Positioning maps

  • Competitive Business Analysis

    • Market Share

    • Relative price

    • Marketing Expenses (% of Sales)


Competitive advantage
Competitive Advantage

  • Cost Advantage

    • Better prices and/or margins

  • Differentiation

    • Mix has more benefits for customer

  • Marketing Advantage in

    • Channel, Sales Force, Product Development etc.


Cost advantage
Cost Advantage

  • Variable Cost (learning curve)

  • Unit cost (economies of scale)

  • Marketing Mix Efficiencies (no sales force)

  • Operating Efficiencies (new plant & equip)


Product differentiation
Product Differentiation

  • Key product benefits

  • Service benefits

  • Brand Reputation, Value or Equity


Marketing fixed asset or structural advantage
Marketing(Fixed Asset or Structural Advantage)

  • Channels

    • Distribution Outlets, Relative Market Share

  • Sales Force

    • Hiring Best Grads

  • Brand Awareness


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