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6. Competitor Analysis
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- 1Summarise: The five goals of marketing“Sell more stuff to more people more often for more money more efficiently” (Zyman)
- 2Define: Porter's Five Forces FrameworkPorter’s Five Forces Framework is a tool for analysing competition of a business. It draws from industrial organisation economics to derive five forces that determine the competitive intensity and, therefore, the attractiveness (or lack of it) of an industry in terms of its profitability. The forces are:
1) Industry rivalry
2) Threat of substitutes
3) Bargaining power of buyers
4) Threat of new entrants
5) Bargaining power of suppliers - 3Explain: The relevance of Porter's 5 ForcesCompetitiveness is characterised by globalisation. Porter’s 5 Forces is a concept accepted by all industries and countries since Porter published Competitive Strategy (1980). The competitive strategies chosen are determined by variables which determine expected results, and how they correlate with each other. Porter’s 5 Forces therefore enables a firm to create a defensible position based on a SWOT analysis (Kume, 2013).
- 4Explain: The impact of the internet on Porter's Forces• There has been an attempt to criticise Porter’s thoughts regarding internet and industry structure and to enrich the Porter’s 5 Forces Model with the “power of innovation”
- Michael Porter’s arguments for the new economy provide a useful starting point in the analysis of the environment. His arguments are though based on exaggerated phenomena. Factors that determine a sector’s profitability could be enriched with the innovation that prevails in the particular sector (Karaginnapolous, 2005). - 5Describe: Competitor analysis model
- 6Describe: 7 Steps of Competitor Analysis1) Identify competitors: External scan – identify direct and indirect competitors, as well as competitors with the same clients and target products
2) Assessing competitors’ strategies: Identify features that competitors offer, as well as their market share
3) Positioning in the market: Undertake market research and perform a SWOT
4) Build a competition portfolio: Identify tangible and intangible features to be updated when deploying your sales force
5) Plan a strategy: Select competitors to attack or avoid. Employ market challenger, leader or follower strategies
6) Execute your strategy and have a contingency plan with online presence
7) Follow up: Quantitatively and qualitatively measure responses to the executed strategy
(Marketing91, 2018) - 7Explain: Identifying competitorsHow do we track our competitors that service and target the same audience or the same target markets, or aim to target these in the future?
• Market intelligence
• Competitor maps - 8Explain: Market intelligenceHow do we track our competitors that service and target the same audience or the same target markets, or aim to target these in the future?
• Market intelligence:
- What information to analyse:
Who are your competitors?
Size and dominance of competitors
Competitors’ customer base
Competitor objectives
Competitor strengths and weaknesses
- Competitor data types
Competitor websites
Competitor annual reports and press releases
Competitor activity observations
Competitor product / service use surveys
Competitor news on TV, radio, internet and newspapers - 9Explain: Competitor maps• Firms face a wide range of competition in products and services. It is therefore useful to create competitor maps and thus avoid customer myopia – the over-reliance on the existing customer base rather than studying the whole market. Methods to understand competitors include:
- Market point of view
- Industry point of view - 10Explain: How to assess a competitorSWOT analysis
- 11Define and explain: TOWS matrixThe TOWS matrix is a tool to analyse the competitive situation of the company leading to the development of one of the four distinct sets of strategies.
• The TOWS matrix is a conceptual framework with a wider analysis than a SWOT.
- It enables a systematic analysis to facilitate the match of external threats and opportunities with the internal weaknesses and strengths of a company. - 12TOWS matrix image
- 13Explain: Reasons for evaluating target marketsKey target markets will be evaluated and selected to achieve the goals and objectives set. Marketers then focus their marketing efforts on where they want to be, and what they hope to accomplish in the market.
• Performance variables include sales, market share, new market entry and profitability. - 14Explain: How to assess competitors' strategies (part 1)
- 15Explain: How to assess competitors' strategies (part 2)Competition is a driving force (Medin, 2015)
- 16Explain: Competition as a network process (Medin, 2015)
- 17Discuss: Competitor reactions to new strategyHow will competitors react to a new strategy and do in the future? (Belch & Belch, 2017)
Potential reactions include:
• Price reduction
• Increase in promotional selling
• Development of new brands
• Attacking one another in comparative advertising
These may affect our competitor advantage. - 18Explain: Competitive strategies to gain an advantage (positioning)Positioning in the market
• Four competitive strategies to gain an advantage include:
1) Quality products at a premium price
2) Superior customer service
3) Lowest production costs
4) Dominating channels of distribution - 19Describe: Competitive brands - a framework for brand positioning
- 20Explain: How to identify multichannel contact - questions to askHow do competitors reach consumers? Furthermore:
• What is their promotional message?
• What consumer value is being derived?
• Which uncontrollable events could occur in this process? - 21Describe: Building a competition portfolio
- 22Explain: How to select competitors• Identify strong or weak competitors using a customer value analysis
• Identify close or distant competitors and the risk of each
• Estimate the reaction to controllable or uncontrollable events
• Identify direct or indirect competitors
- An indirect competitor is any business, individual or action that provides your potential customers with an outcome similar to what you provide. Indirect requires the same level of monitoring as direct competition. - 23Explain: What drives competitors' position in the market?• Goal-setting: Compare with competitors’ goals
• Future objectives: Should the emphasis be placed locally or globally?
• Current strategy: Does the strategy support changes in competitor structure?
• Assumptions
• Capabilities - 24Discuss: Evaluating current strategic thrustsDoes your strategy support changes in structure? i.e. does it support changes in the external environment?
• Assumptions about industry?
• Volatility?
• Stable competitive conditions?
• Capabilities?
• What are our competitors’ strengths and weaknesses?
• How do your capabilities compare? - 25Explain: How to plan an online presence• Online presence should be planned after you compare your competitors’ weaknesses against your own strengths and vice versa. You’ll learn how to:
- Identify your direct and indirect competitors
- Analyse your competitors’ content strategy for quality and reach
- Grade your competitors’ SEO strategy and increase your own authority
- Equip your salespeople to compete during the decision stage of the buyer’s journey
- Organise all of your research in a single document to align your entire team – develop a MIS. - 26Describe: Competitor analysis
- 27Describe: Key concepts to improve your web customer experience• Usability (ISO): The extent to which a product can be used by specified users to achieve specified goals / tasks with effectiveness, efficiency and satisfaction in a specified context of use
• Accessibility: An approach to site design intended to accommodate site usage using different browsers and settings particularly required by the visually impaired and visitors with other disabilities including motor control, learning difficulties and dead users. This also helps search engine optimisation.
• Persuasion: Maximising returns from web investments through measurement and optimisation using techniques including web analytics and usability studies. - 28Explain: Why to execute strategy with a contingency plan• Example: “We face an intensely competitive environment complicated by disruptive competitors offering luxury on a new value proposition – the best doesn’t have to cost the most” (Zyman)
- E-commerce is one way by which luxury brands can transition to a more digitally led distribution model while retaining luxury and quality elements.
- Omni-channel distribution is emerging as a dominant model in emerging markets.
- Consumers are likely to shop on mobile. However, in mature markets 63% of sales still take place in retail stores (Deloitte Global Luxury Brands Report, 2017).
- Millennials’ digital influence: 42% of purchases of luxury items are made on computer or mobile phone.
• Competitor marketing emphasises how competitors’ brand differ. For example, you could emphasise greater value in experiences, lifestyle, enhancement and positive impact. Thus, the social media currency may differ from the physical products.
Información
- Descripción
- Marketing Communications Fichas sobre 6. Competitor Analysis, creado por Nina Olsson el 25/04/2019.
- Creado por
- Nina Olsson · abr 2019
- Actualizado
- 25 abr 2019
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- 1
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