Competitive Analysis and Product Positioning. Competitors u Direct competitors u Indirect...

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Competitive Competitive Analysis Analysis and Product and Product Positioning Positioning

Transcript of Competitive Analysis and Product Positioning. Competitors u Direct competitors u Indirect...

Page 1: Competitive Analysis and Product Positioning. Competitors u Direct competitors u Indirect competitors u Local competitors u Cross-over competitors.

Competitive Analysis Competitive Analysis

and Product and Product PositioningPositioning

Page 2: Competitive Analysis and Product Positioning. Competitors u Direct competitors u Indirect competitors u Local competitors u Cross-over competitors.

Competitors

Direct competitorsDirect competitors Indirect competitorsIndirect competitors

Local competitorsLocal competitors Cross-over competitorsCross-over competitors

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Identifying the Competitors -1

Product

Direct Indirect

Industry

Cross-Over

Local

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Identifying the Competitors -2

Products’ feature and qualityProducts’ feature and quality CRM strategiesCRM strategies R&D strategiesR&D strategies Marketing mixMarketing mix

– PricePrice– PromotionPromotion– DistributionDistribution– Supply-chain managementSupply-chain management

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Competitor Profiling — Eastman Kodak

Eastman KodakEastman Kodak

PurchaseCamera

Purchase Film

Take Pictures

Digitally ManipulatePictures

Print and Receive Pictures

SharePictures

Store Pictureson CD

Purchase Accessories

Download and Choose Pictures

to Print

HP

Olympus

Snapfish

Moto Photo

Geocities

Seattle Filmworks

District

Ofoto

HP

AdobeSystems

Fuji

cameraworks.com

Snapfish

Shutterfly

Direct Competition

IndirectCompetition

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COMPETITIVE ANALYSIS FLOWS OUT OF CUSTOMER

ANALYSIS

Understand customers needs and wantsUnderstand customers needs and wants Identify current and potential competitorsIdentify current and potential competitors Perform industry analysis, identify suppliers Perform industry analysis, identify suppliers

and common intermediariesand common intermediaries Understand your competitorsUnderstand your competitors Determine competitor strategies (present and Determine competitor strategies (present and

future)future)

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COMPETITORS TO CONSIDER

CURRENTCURRENT– market structure analysismarket structure analysis– perceptual analysisperceptual analysis

POTENTIALPOTENTIAL (potential entry of new competitors)(potential entry of new competitors)– remain alert to their possibilityremain alert to their possibility– depends ondepends on

• barriers to entrybarriers to entry• expectations about competitive reactionsexpectations about competitive reactions

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An Example:

Using a Perceptual Map for Competitor Analysis

• Lincoln

• Cadillac•Mercedes

•Chrysler•Buick

• Oldsmobile

A touch of class / a car to be proud to own

Practical / affordable / good gas mileage

Conservative looking / appeals to older people

Fun to drive / sporty look / appeals to

younger people

•Porsche

•BMW

•Pontiac

•Chevrolet

•Nissan

•Toyota

•VW

•Ford

•Dodge

•Plymouth

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BARRIERS TO ENTRY OF NEW COMPETITORS

Economies of ScaleEconomies of Scale Lack of Product DifferentiationLack of Product Differentiation Capital RequirementsCapital Requirements Access to Distribution ChannelsAccess to Distribution Channels Buyer Switching CostsBuyer Switching Costs Government Policies and RegulationsGovernment Policies and Regulations

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COMPETITIVE RELATIONS

CONFLICTCONFLICT

COMPETITIONCOMPETITION

COEXISTENCECOEXISTENCE

COOPERATIONCOOPERATION

COLLUSION COLLUSION

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CONFLICT WITH COMPETITORS

Focus on opponentFocus on opponent Market is viewed as a zero-sum game Market is viewed as a zero-sum game

(one gains only by taking from another)(one gains only by taking from another) Competitors’ objectives are mutually Competitors’ objectives are mutually

inconsistentinconsistent

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COMPETITION

Focus on winning something Focus on winning something (usually customers)(usually customers)

Depends onDepends on– market attractivenessmarket attractiveness– industry structureindustry structure– commitment of competitorscommitment of competitors– technology requiredtechnology required– product differentiationproduct differentiation

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COMPETITOR COEXISTENCE

Working Toward a Goal Independent of OthersWorking Toward a Goal Independent of Others

Different Niches of Market AvailableDifferent Niches of Market Available

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COOPERATION

Involves working Involves working together toward a together toward a common goalcommon goal

Three main typesThree main types– DyadicDyadic

– Joint ActivityJoint Activity

– Investment in a Investment in a Third PartyThird Party

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THREE TYPES OF COMPETITOR COOPERATION

Formal Cooperation

Dyadic Joint activity Investment in third party

• Ownership

• Interlocking directorship

• Formal exchanges

• Subcontracting

• Reciprocity

• Production

• Sourcing

• R&D

• Promotion

• Consortia

• Joint ventures

• Trade associations

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COLLUSION Cooperative Behavior Designed to Cooperative Behavior Designed to

Injure a Third PartyInjure a Third Party• customerscustomers

• supplierssuppliers

• non-colluding competitorsnon-colluding competitors

• general publicgeneral public

Can be Direct or IndirectCan be Direct or Indirect

Often IllegalOften Illegal

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GATHERING COMPETITIVE DATA

Establish information-gathering systemEstablish information-gathering system

Identify your competitorsIdentify your competitors

Perform a competitive auditPerform a competitive audit

Evaluate results of the auditEvaluate results of the audit

Regularly integrate into planning Regularly integrate into planning

processprocess

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HOW DO YOU COMPETE?

Offensive StrategiesOffensive Strategies– Concentrate on the competitors’ relative Concentrate on the competitors’ relative

weaknessesweaknesses– 5 types5 types

Defense StrategiesDefense Strategies– Goal is to counter each offensive strategyGoal is to counter each offensive strategy– 6 types6 types

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OFFENSIVE STRATEGIES

1) Frontal attack1) Frontal attack– direct confrontationdirect confrontation– most difficult and most difficult and

dangerousdangerous

2) Flanking attack2) Flanking attack– addresses gaps in addresses gaps in

competition’s market competition’s market coveragecoverage

– Niche marketNiche market

3) Encirclement3) Encirclement – forcing competitor to forcing competitor to

spread resources thin by spread resources thin by probing on many fronts at probing on many fronts at onceonce

4) Bypass attack4) Bypass attack– avoids confrontationavoids confrontation– diversificationdiversification

5) Guerrilla warfare5) Guerrilla warfare– small, intermittent attackssmall, intermittent attacks

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DEFENSE STRATEGIES

1) Position Defense1) Position Defense– fortify firm’s existing positionfortify firm’s existing position

2) Mobile Defense2) Mobile Defense– Market broadeningMarket broadening

3) Preemptive Defense3) Preemptive Defense– Attacking first (first strike)Attacking first (first strike)

4) Flank-positioning4) Flank-positioning– extend firm’s offerings into extend firm’s offerings into

new segments to protect new segments to protect existingexisting

5) Counter-offensive 5) Counter-offensive Defense Defense– gathering resources and gathering resources and

counter-attacking when counter-attacking when threatenedthreatened

6) Strategic Withdrawal6) Strategic Withdrawal

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Partners

Complementary partnerComplementary partner

Capability partnerCapability partner