Competitive Intelligence Marketing

Week 3
Competitive Intelligence Marketing
Today’s agenda:

◦ Generic Competitive Strategies

◦ Risk of Generic Strategies
◦ The Components of Competitor Analysis
◦ Competitive market Analysis
◦ ARTICLE: Competing with Patanjali
The essence of strategy is choosing what
not to do. ~Michael Porter
Generic Competitive Strategies

1. Overall cost leadership (value vs. price)

2. Differentiation
3. Focus (group, segment, market)
 What is Cost Leadership?
◦ A company pursuing a Cost Leadership strategy aims to establish a competitive advantage by achieving the
lowest operational costs in the industry.

◦ Customization vs. Standardization.

◦ The Cost Leadership strategy vs. Price Leadership strategy

◦ How can you establish a competitive advantage in costs?

◦ High asset utilization
◦ Low direct & indirect operating costs
◦ Value chain control
◦ Use of Technology
 Differentiation
◦ The markets are noisier and more crowded than ever, and customers are overwhelmed with too many choices.
◦ Standing out from the competition has become imperative for businesses with a long-term vision.
◦ Differentiation is differentiating an offering from others in the market, to make it more appealing to the target
audience.
◦ Advantages vs. Disadvantages of Product Differentiation

◦ Types of product differentiation:

◦ Horizontal differentiation - that cannot be evaluated in terms of quality. E.g.: Mineral water brands.
◦ Vertical differentiation - that can be evaluated in terms of quality. It’s a case where it is possible to say that one
good is better than the other.
◦ Simple (or Mixed) differentiation - Differentiation based on numerous characteristics.
 Risk of Generic Strategies

Overall cost leadership:

 Technological change that nullifies past investments or learning

https://www.youtube.com/watch?v=Xksm8ZGgLmw
 Low-cost learning by industry newcomers

 Inability to see required product or marketing change because of the attention placed on cost

 Inflation in costs of different products/processes

Risk of Generic Strategies
Risk of Differentiation:
 Buyers sometimes sacrifice some of the features, services or image possessed by the differentiated firm
for large cost savings.

 Buyers need for the differentiating factor may fall.

Risk of Focus:
 Competitors find submarkets within the strategic target and out focus the focuser.
Analysis of the market served
◦ Current and potential segmentation: (market gaps)
e.g.: Convenience foods vs. healthier eating
Assessing competitors’ current strategies
◦ Competitors supporting marketing
mix:
What clues can we get from there?

Competitive Advantage

https://
www.youtube.com/watch?
v=mvGBYoob1pA