PREPARED BY:Mehta Chandni Vasoya Piyush Kamani Peri Parekh Ronak

GUIDED BY:Dr. Ajay Shah

COMPETITIVE
STRATEGIES OF DIFFERENT PLAYERS IN MARKET

INTRODUCTION
Having a competitive advantage is necessary for a firm to compete in the market What is Competitive Advantages? A competitive advantage is an advantage over competitors gained by offering consumers greater value, either by means of lower prices or by providing greater benefits and service that justifies higher prices.

But what is more important is whether the competitive advantage is sustainable A firm must identify its position relative to the competition in the market By knowing if it is a leader, challenger, follower or nicher, it can adopt appropriate strategies to compete

COMPETITIVE ADVANTAGE
Definition:
Competitive strategy is about being different. It means purposely choosing to perform activities differently or to perform different activities than rivals to deliver a unique mix of value. -- Michael Porter

FOR EXAMPLE:Competitive advantage of Maruti Suzuki is the well known brands. In addition the company has increased the lead by expanding its distribution networks Low cost leadership

CORE COMPETENCY
Definition : A core competency is a specific factor that a business sees as being central to the way it, or its employees, works.

CHARACTERISTICS

It is a source of competitive advantage in that it makes a significant contribution to perceived consumer benefits.

It has application in a wide variety of market. It is difficult for competitors to copy.

COMPETITOR ANALYSIS

Identifying
the Companys competitor

Assessing competitors
objectives, strategies, strength and weakness, & reaction patterns

Selecting
which competitor to attack or avoid

IDENTIFYING COMPETITORS
It

would seem a simple task for a company to identify its competitors.

STRATEGIES
A

group of firms following the same strategy in a given target market is called a strategic group.

competitor seeking for? Duration . Dependency .

What

 Strengths

and weakness

SELECTING COMPETITORS
1. Strong vs. weak Strong Weak

2.Close vs. Distant

Close Distant

GOOD V/S BAD:-

STRATEGIES FOR MARKET PLAYERS

 MARKET

LEADER

EXAMPLE OF MARKET LEADER

STRATEGIES FOR MARKET LEADERS

Market Leaders objectives:
the total market by y Finding new users y Creating new uses, and y Encouraging more usage Protect its current market share by y Adopting defense strategies (see following slides) Increase its market share y Note the relationship between market share and profitability
Expand

DEFENSE STRATEGY
A

market leader should generally adopt a defense strategy Six commonly used defense strategies y Position Defense y Mobile Defense y Flanking Defense y Contraction Defense y Pre-emptive Defense y Counter-Offensive Defense

SIX TYPES OF DEFENSE STRATEGIES

1. Position Defense
Least

successful of the defense strategies defence involves building superior brand

Position

power and making the brand almost impregnable.

e.g. Nascafe has defence its position against several attacking brand using this strategy. .

2. Flanking Defense:
Secondary

markets (flanks) are the weaker

areas and prone to being attacked

Pay e.g.

attention to the flanks San Miguel introduced a flanking brand in

the Philippines, Gold Eagle, as a defense against APBs Beerhausen

3. Pre-emptive Defense
Detect

potential attacks and attack the enemies

first
Let

it be known how it will retaliate or brand proliferation is a form of pre-

Product

emptive defense e.g. State bank of India

4. Counter-Offensive Defense
Responding

to competitors head-on attack by

identifying the attackers weakness and then launch a counter attack e.g. Toyota launched the Lexus to respond to Mercedes attack

5. Mobile Defense
By

market broadening and diversification For marketing broadening, there is a need to y Redefine the business (principle of objective), and y Focus efforts on the competition (the principle of mass) e.g. the petroleum company like reliance sought to recast themselves as energy company

6. Contraction Defense
Withdraw

from the most vulnerable segments

and redirect resources to those that are more defendable

By

planned withdrawal

contraction

or

strategic

e.g. Indias TATA Group sold its soaps and detergents business units to Unilever in 1993

 Market

Challenger

EXAMPLE OF MARKET CHALLENGER

MARKET CHALLENGER STRATEGIES

The market challengers strategic objective is to gain market share and to become the leader eventually How?
By By By

attacking the market leader attacking other firms of the same size attacking smaller firms

MARKET CHALLENGER STRATEGIES (CONTD)

Types of Attack Strategies

Frontal attack Flank attack Encirclement attack Bypass attack Guerrilla attack

1. FRONTAL ATTACK
y y

The attractor target on the positive aspect and The challenger has clear distinctive advantage(s)

e.g. Japanese and Korean firms launched frontal attacks in various ASPAC countries through quality, price and low cost

2. FLANK ATTACK
Attack

the enemy at its weak points or

blind spots i.e. its flanks

Ideal

for challenger who does not have

sufficient resources e.g.SBI and ICICI

3. ENCIRCLEMENT ATTACK
Attack

the enemy at many fronts at the same challenger having superior

time Ideal for resources

4.BYPASS ATTACK
diversifying into unrelated products or markets neglected by the leader Could overtake the leader by using new technologies
By

e.g. Pepsi use a bypass attack strategy against Coke in China by locating its bottling plants in the interior provinces

5.GUERRILLA ATTACK
By

launching small, intermittent hit-and-run

attacks to harass and destabilize the leader

Usually

use to precede a stronger attack

WHICH ATTACK STRATEGY SHOULD A CHALLENGER CHOOSE?

Use a combination of several strategies to improve market share over time

 Market

follower

EXAMPLE OF MARKET-FOLLOWERS

MARKET-FOLLOWER STRATEGIES (CONTD)

Each

follower tries to bring distinctive advantages to its target market-location, services, financing

TYPES OF MARKET-FOLLOWERS
Counterfeiter

Cloner

Imitator

Adapter

 Market

Nicher

EXAMPLE OF MARKET-NICHER

MARKET-NICHER STRATEGIES
Smaller

firms can avoid larger firms by

targeting smaller markets or niches that are of little or no interest to the larger firms.

MARKET-NICHER STRATEGIES (CONTD)

Nichers

must create niches, expand the niches

and protect them

What

is the major risk faced by nichers?

Market niche may be attacked by larger firms once they notice the niches are successful

MULTIPLE NICHING
[A] firm should `stick to its niching but not necessarily to its niche. That is why multiple By

niching is preferable to single niching.

developing strength in two or more niches the company increases its chances for survival. -Philip Kotler

CASE STUDY
ON DIFFERENT PLAYERS STRATEGY IN MARKET

MARKET SHARES OF NOKIA AND OTHER CELLULAR PHONE INDUSTRY

50

CASE STUDY ON MOBILE INDUSTRY

1.Market leader (NOKIA)

VISION Voice goes mobileif it can go mobileit will.

52

MISSION Connecting people

STRATEGY OF NOKIA

Nokias market share in India Mobile Microfinance India not a low-end market segment Nokias strong distribution in India Indias Most Trusted Brand

CASE STUDY ON MOBILE INDUSTRY

2. Market Challenger (SAMSUNG)

STRATEGY OF SAMSUNG
Samsung

lacked experience in consumer marketing and focused mainly on production and market shares. distribution network covering most of the world. cost price camera resolution

Wide

Low

High

CASE STUDY ON MOBILE INDUSTRY

3. Market Follower (LG)

STRATEGY OF LG

LG is a leading player in consumer electronics. technology innovation

High

understands consumer electronic market and competitor. distribution channel

Large

CASE STUDY ON MOBILE INDUSTRY

4. Market Nicher (MICROMAX)

STRATEGY OF MICROMAX
Newly

introduce product

Many

feature at affordable price

Durability

60