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11
Competitive Dynamics
 Chapter 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 nichers compete
effectively?
What marketing strategies are appropriate at
each stage of the product life cycle?
How should marketers adjust their strategies
and tactics for an economic downturn or
recession?
Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall 11-2
 Figure 11.1
Hypothetical
Market Structure

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 Expanding the Total Market

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 New Ways to Use a Brand

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 Protecting Market Share

Responsive anticipation

Creative anticipation

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 Figure 11.2 Types of
Defense Strategies

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 Figure 11.3 The Concept of
Optimal Market Share

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 Market Challenger Strategies

Define the strategic objective and opponents

Choose a general attack strategy
Choose a specific attack strategy

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 General Attack Strategies

Frontal attack
Flank attack
Encirclement attack
Bypass attack
Guerilla warfare

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 Specific Attack Strategies

Price discounts Improved services

Lower-priced Distribution
goods innovation
Value-priced goods Manufacturing-cost
Prestige goods reduction
Product Intensive
proliferation advertising
Product innovation promotion

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 Market Follower Strategies

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 Market Nicher Strategies

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 Niche Specialist Roles

End-User Specialist Product-Line

Vertical-Level Specialist
Specialist Job-Shop
Customer-Size Specialist
Specialist Quality-Price
Specific-Customer Specialist
Specialist Service-Specialist
Geographic Channel Specialist
Specialist

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 Product Life Cycles

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 Figure 11.4 Sales and
Profit Life Cycles

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 Figure 11.5a
Common PLC Patterns:
Growth-Slump-Maturity

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 Figure 11.5b
Common PLC Patterns:
Cycle-Recycle

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 Figure 11.5c
Common PLC Patterns:
Scalloped

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 Figure 11.6 Style, Fashion, and
Fad Life Cycles

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 Maintaining a Market Advantage:
Trivial Pursuit

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 Strategies for Developing a
Pioneer Advantage

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 Growth Stage Strategies

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 Electrolux

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 Changing Brand Course

Market Modification

Product Modification

Marketing Program
Modification

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 Decline

Declining sales
Low cost per customer
Declining profits
Laggards

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 Marketing in an
Economic Downturn
Invest
Get close to
customers
Review budgets
Use a compelling
value proposition
Fine-tune offerings

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 A Compelling Value Proposition

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 For Review
How can market leaders expand the total
market and defend market share?
How should market challengers attack market
leaders?
How can market followers or nichers compete
effectively?
What marketing strategies are appropriate at
each stage of the product life cycle?
How should marketers adjust their strategies
and tactics for an economic downturn or
recession?
Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall 11-29