Intro to Marketing

Competitive advantageCompetitive advantages require delivering more value and satisfaction to target consumers than competitors do

Competitive marketing strategies are how companies analyze their competitors and develop value-based strategies for profitable customer relationshipsTodays Companies2Competitive StrategyDefinition: Strategy A complete contingent planExample: Hyundai long-term plan of fearless marketing and quality improvements

Definition:Compete-- To strive consciously or unconsciously for an objectiveExamples: Offense vs. Defense (sports)Price CutsToasted Subs??Enterprise vs. Hertz

I have a goal and act to achieve that goal, I must anticipate what the competitors are going to doNeed to differentiate in a way that competitors do not have3Basic Competitive StrategiesMichael Porters four basic competitive positioning strategiesOverall CostleadershipDifferentiationFocusMiddle of the roadFocus: on a product, segment of consumer, highly specialized product, sport car, high capacity van with specialized featuresDifferentiation: microsofts excel, family sedan4Preference Line: Car exampleSpeedPassengerCapacity2-SeatSports CarMiniVanFamily Sedan4-SeatCoupeFull-SizeVanPreference Line: Car exampleSpeedPassengerCapacity2-SeatSports CarMiniVanFamily Sedan4-SeatCoupeFull-SizeVanPreference Line: Car exampleSpeedPassengerCapacity2-SeatSports CarMiniVanFamily Sedan4-SeatCoupeFull-SizeVan

New strategiesCopyright 2011 Pearson Education, Inc. Publishing as Prentice HallOPERATIONAL EXCELLENCECUSTOMER INTIMACYPRODUCT LEADERSHIP

Operational excellenceCost leadership need efficient operationsHelp to add value to your productUPS

Product leadershipSports cars

Customer intimacy. Competitive PositionsMarket challenger strategiesMarket leader strategiesMarket follower strategiesMarket nicher strategies

LEADERCopyright 2011 Pearson Education, Inc. Publishing as Prentice HallExpand total demandProtect current marketExpand market shareStrategiesPortray themselves as the leader in the marketNot too concerned with what competitors are doing (Coca-cola)Expand total market with the expectation to control the same relative size of the marketThe only reason why the leader wouldnt expand the market is b/c the price of acquisition/expansion > profit from expansionCampbells Soup

CHALLENGERCopyright 2011 Pearson Education, Inc. Publishing as Prentice HallAttack: Challenge the leaderAvoid: Play along,2nd Mover advantageStrategiesLG

FOLLOWERLearn from leaderAvoid development costsFollow closely/at a distanceStrategiesCheaper productsDont attack the leadereMachine: cheap laptop

NICHERSpecialization is keyFocus on:markets, customers, products, mixesStrategiesPay less attention to the competitors, focus on the niche markets needsReally understand the needs and wants of a set consumer baseSometimes you can lose your segment to big leadersHomeclick.com: selling what home depot and lowes dont sellSustaining Competitive AdvantageLet us watch an entire movie in 2 minutes:

Moneyball

What happens next? Is Oakland a baseball powerhouse?

The more successful you are, the bigger the target you are17The key is continuous, relentlessinnovation and improvementDell Adamobuilt like a macbook, but betterDell is trying to copy appleYou have to continually improve18Umpqua Bank Video CaseWith what companies does Umpqua compete?BECUSmaller banksWhat is Umpquas competitive advantage? Categorize it according to the class framework.Personalized service, friendly staffCoffee shop feelWill Umpqua be able to maintain this advantage in the long run? Why or Why not?Its ambiance can be easily replicableDifferentiation: trying to be different from other banks (coffee, personal service) pursue a strategy that is appealing to a large base of consumers (Bank of A)

Focus: youre different because you appeal to a smaller group of consumers (Umpqua Bank)

Both focus and differentiation involve being different

Nicher: Umpqua

19CitibankCompetitors: Wells Fargo, ChaseCompetitive AdvantageGlobal bankOne of the biggest banks in the worldMarket leader, large market shareWill it be able to maintain this advantage?It will be hard for other banks to match its large market share