Priyanka IIT Kanpur

Determining a competitive frame of reference

It defines which other brands a brand competes with and therefore which brands should be the focus of competitive analysis. Decisions about the competitive frame of reference are closely linked to target market decisions.

How to START ?

Determine Category Membership – the product or sets of products with which a brand competes and function as close substitutes

Pepsico knows Dasani is a major competitor for its Aquafina brand

VS

Petsmart.com knows a major online retail competitor for pet food and supplies is Petco.com

VS

Identifying Potential Competitors

It would seem a simple task for a company to identify its competitors but the range of potential competitors can be much broader than the obvious And a company is more likely to be hurt by emerging competitors than by current competitors

New technology products such as iPad are in the process of creating newer categories that are different from laptops and conventional mobile phones

Competition from industries

Marketers classify industry according to: 1.Number of sellers 2.Degree of product differentiation 3.Presence or absence of entry, mobility, and exit

barriers 4.Cost structure 5.Degree of vertical integration 6.Degree of globalization

Competition from marketing point of view

Using the marketing approach, we define competitors as companies that satisfy the same customer need

Company needs to gather information about each competitor’s real and perceived strengths and weaknesses

Finally it must ask...

What is each competitor seeking in the marketplace? What drives each competitor’s behaviour?

Recap

• Determining a competitive frame of reference • Identifying competition • Identifying potential competitors • Competition from industry and market point of view • Analyzing competitors