In the name of Allah who is most merciful and beneficial

Defensive Strategies

Presented By

Umair Habib 11212

What is Strategies?

A method or plan chosen to bring about a desired future such as achievement of a goal or solution to a problem.

Defensive Strategies Defensive strategies are marketing warfare strategies

designed to protect:

Company’s market share

Profitability

Product positioning or

Mind share.

Defensive Strategy-Principle Always counter an attack with equal or greater force.

Defend every important market.

The firm should be vigilant in scanning for potential attackers. Assess the strength of the competitor.

The best defense is to attack yourself. Attack your weak spots and rebuild yourself anew.

Defensive strategies should be the exclusive domain of the market leader.

Types of Defensive Strategies

Joint venture

Retrenchment

Divestiture

Liquidation

Joint Venture Strategy Joint venture is a popular strategy that occurs two or

more companies form a partnership for the purpose of capitalizing on some opportunity.

This strategy allows companies to improve communication and networking, to globalize operation and minimize risk.

Joint venture of Maruti(51%): Suzuki(49%)

Joint venture of Tata(73.3%): Docomo(26.7%)

Retrenchment Strategy Retrenchment occurs when an organization regroups

through cost and asset reduction to reverse declining sales and profits.

In some case, bankruptcy can be an effective type of retrenchment strategy.

Vishal Mega Mart

Subhiksha Stores

Divestiture Strategy Selling a Division or part of an organization is called

divestiture.

Divestiture is often used to rise capital for further strategic acquisitions or investment.

This strategy is also useful to rid unprofitable activities in a firm.

IBM- PCD Divestiture (Lenovo)

Liquidation Strategy Selling all of company’s assets, in parts, for their

tangible worth is called liquidation.

However, it may be better to cease operating than to continue losing large sum of money.

Satyam Scam

Eckerd Pharmacy

Advantages of Defensive Strategy

Increasing your marketing and advertising.

The Defensive Strategies Typically less risky.

Enhance the value of your product or services.

Disadvantages of Defensive Strategy

Business does not understand its target market.

Innovation and product development.

Conclusion Defensive Strategies strengthen the firm’s present

position and the lessens the risk of being attacked.

They also help sustain any competitive advantage.