Chapter 11 - Competitive dynamics. In this chapter, we will address the following questions: How can market leaders expand the total market and defend market share? How should market challengers attack market leaders? How can market followers or niche compete effectively? What marketing strategies are appropriate at each stage of the PLC? How should marketers adjust their strategies and tactics for an economic downturn or recession? | Kotler • Keller Phillip Kevin Lane Marketing Management • 14e Competitive Dynamics Chapter 11 Discussion Questions How can market leaders expand the total market and defend market share? How should market challengers attack market leaders? How can market followers or niche compete effectively? What marketing strategies are appropriate at each stage of the PLC? How should marketers adjust their strategies and tactics for an economic downturn or recession? Companies are facing increased competition – from global competitors, emerging online competitors, private-label and store brands, and brand extensions by mega-brands. No brand, unless it is a monopoly, can rest on its laurels. Market Members Market leader Market challenger Market follower Market nichers Market leaders have the higher market share and usually base-line in terms of price. Leaders also lead the market in new-product introductions, distribution coverage, and promotional intensity. Historic market leaders include: . | Kotler • Keller Phillip Kevin Lane Marketing Management • 14e Competitive Dynamics Chapter 11 Discussion Questions How can market leaders expand the total market and defend market share? How should market challengers attack market leaders? How can market followers or niche compete effectively? What marketing strategies are appropriate at each stage of the PLC? How should marketers adjust their strategies and tactics for an economic downturn or recession? Companies are facing increased competition – from global competitors, emerging online competitors, private-label and store brands, and brand extensions by mega-brands. No brand, unless it is a monopoly, can rest on its laurels. Market Members Market leader Market challenger Market follower Market nichers Market leaders have the higher market share and usually base-line in terms of price. Leaders also lead the market in new-product introductions, distribution coverage, and promotional intensity. Historic market leaders include: McDonald’s, Microsoft, Visa, Gatorade, Best Buy, and Blue Cross. Other market members include challengers, followers, and niche players. Other firms enter and exit the markets, primarily during the maturity and decline stage of the product life cycle. Figure Hypothetical Market Structure Staying Number One Expand total market demand Protect current market share Increase market share Expanding Total Market Demand New Customers More Usage Replacement rate New product uses Protect Current Market Share Proactive Marketing Offensive Strategy Defensive Strategy Figure Six Types of Defense Strategy Increase Market Share Antitrust action Pursue wrong marketing activity Lower overall quality Decreased profitability 2012 2013 “Actual” quality “Perceived” quality If the size of the market remains constant, market leaders often look to increase share. The payoffs can be rewarding. For example, the Carbonated Soft Drink (CSD) market has about $70 billion in annual sales. A 1% point .
