Marketing Management

Chapter 9
Dealing with Competition
Porter’s Five Forces
 Identifying Competitors
Industry Concept of Competition

Number of sellers and degree of

differentiation
Entry, mobility, and exit barriers
Cost structure
Degree of vertical integration
Degree of globalization
Market concept of competition
Competitors are companies that satisfy the
same customer need
Examples
Word processing package – writing ability –
pencils, pens or typewriter
Coca cola missed out on coffee & fresh juice
business
Entertainment providers
Analyzing competitors
Share of market

Share of mind

Share of heart
Selecting competitors
Strong vs. weak

Close vs. distant

Good vs. bad

Hypothetical Market Structure

10% 20% 30% 40%

Market Market Market Market
Nichers Follower Challenger Leader
 Expanding the Total Market
New
More usage
customers

Market New market Amount of

Frequency
penetration segment consumption
(packaging)

Geo
expansion Using the New uses
same way
Six Types of Defense Strategies

Market Broadening,
Diversification
Other Competitive Strategies

Market
Challengers

Market Market
Followers Nichers
Market Challenger Strategies
Define the strategic objective and opponents
Attack market leader
Attack firms of its own size & not doing well & are
underfinanced
Attack small local or regional firms
Choose a general attack strategy
Choose a specific attack strategy
General Attack Strategies
Frontal Attack Flank Attack
4ps Geo & seg

Bypass Attack
Encirclement
Diversifying
Attack
(unrelated, geo & tech)
Guerrilla Warfare
Price cuts, intense promo,
legal action
 Specific Attack Strategies
Price discounts Improved services
Lower-priced goods Distribution
Value-priced goods innovation
Prestige goods Manufacturing-cost
Product proliferation reduction
Product innovation Intensive advertising
promotion
 Market Follower Strategies
Counterfeiter – duplicates leader’s product &
sells in black market

Cloner – copies leader’s product with slight variation

Imitator – copies but maintains diff in packaging,

Ad, pricing or location

Adapter – adapts or improves leader’s prod

 Market Nicher Strategies
EARLY MOVERS ADVANTAGE
Q.1
________ are the basic human requirements.

Need
Want
Demand
Q.1
________ are the ways in which we satisfy needs.

Want
Demand
Q.2
The ________ concept holds that consumers will
favor those products that offer the most quality.

Product
Marketing
Production
Selling
Q.2
A(n) ________ group is the one whose values or
behavior are rejected by an individual.

Aspirational
Dissociative
Membership
Primary
Q.3
At the top of Maslow’s hierarchy of needs are
________ needs.

Esteem
Self-actualization
Social
Safety
Q.3
________ risk occurs if the product fails to
perform up to expectations.

Physical
Financial
Social
Functional
Q.4
The buying process starts when the buyer
recognizes a(n) _________.

Product
Advertisement for the product
Salesperson from a previous visit
Problem or need
Q.4
If a marketer decides to segment a market
based on neighborhoods, it will be ________
segmentation.

Demographic
Psychographic
Geographic
Cultural
Q.5
When segmenting on the basis of family life
cycle, all of the following can be segments
except:

Young, single
Male, female
Young, married
Older, married, no children under 18
Q.5
Which of the following is not amongst
Porter’s five forces?

Industry competitors
Technological partners
Substitutes
Buyers
Q.6
The ________ stage of the product life cycle is a
period of rapid market acceptance and
substantial profit improvement.

Introduction
Growth
Maturity
Saturation
Q.6
The four stages of the product life cycle
include all of the following except:

Decline
Learning
Maturity
Introduction
Q.7
Name any 3 market offerings.
Q.7
Name any 3 market offerings.
Q.8
Who are money constrained customers?
Q.8
Who are time constrained customers?
Q.9
What is meant by ideal self-concept?
Q.9
What is meant by others’ self-concept?
Q.10
Briefly explain the production concept.
Q.10
Briefly explain the selling concept.
Q.11
What are the examples of irregular demand?
Q.11
What are the examples of unwholesome
demand?
Q.12
How can the marketers address negative
demand?
Q.12
How can the marketers address overfull
demand?
Q.13
Define possession utility.
Q.13
Define place utility.