CHAPTER 11

COMPETITIVE DYNAMICS

• How can market leaders expand the total market and defend market share?

• How should market challengers attack market leaders?

• How can market followers or nichers compete effectively?

• What marketing strategies are appropriate at each stage of the product life cycle?

Figure 11.1 Hypothetical Market Structure

10%MarketNichers

20%Market

Follower

30%Market

Challenger

40%MarketLeader

Expanding the Total Market

New customersNew customers

More usageMore usage

Protecting Market Share

Proactive MarketingDefensive Marketing

Figure 11.6 Six Types of Defense Strategies

Other Competitive Strategies

Market Challengers

Market Nichers

Market Followers

Market Challenger Strategies

• Define the strategic objective and opponents• Choose a general attack strategy• Choose a specific attack strategy

General Attack Strategies

Frontal Attack

Encirclement Attack

Bypass Attack

Flank Attack

Guerrilla Warfare

Specific Attack Strategies

• Price discounts• Lower-priced goods• Value-priced goods• Prestige goods• Product

proliferation• Product innovation

• Improved services• Distribution

innovation• Manufacturing-cost

reduction• Intensive

advertising promotion

Market Follower Strategies

Counterfeiter

Cloner

Imitator

Adapter

Niche Specialist Roles

• End-User Specialist• Vertical-Level Specialist• Customer-Size Specialist• Specific-Customer Specialist• Geographic Specialist

• Product-Line Specialist• Job-Shop Specialist• Quality-Price Specialist• Service-Specialist• Channel Specialist

Product Life Cycle Marketing Strategies

Product Life Cycle• Introduction• Growth• Maturity• Decline