Chapter 2 notes - Chapter 2 Market Orientation Competitive...

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Chapter 2 Market Orientation Competitive Dynamics – The organization that is market oriented (gathers good market intelligence, analyzes it, disseminates, learns from it and then responds to the intelligence) is competitively successful. Analyzing Competition - In marketing, we define competition by asking, o “Who are our major competitors?” o Who has what share of sales in a given market? o - Economics defines four different supply environment o Markets Monopoly - No competition Single supplier Has control over price, quality, quantity/supply Oligopoly Market dominated by few, larger players usually Few usually because capital expenditure and barriers to entry are high o Market Competition Monopolistic Competition Many suppliers with a variety of products All competition to ‘own their share’ of the market Attempt to convince buyers that they are the ‘best and only’ Perfect competition Many suppliers sell effectively the same thing Rare circumstances – requires that demand is fairly high and stable Low cost production of quality product and efficient distribution determine success in such a market o Market Share Market Share – measures as a company’s percentage of total industry sales over a specified timed period. Mind Share – Share(%) of customers who name the brand when asked to name the first brand that comes to mind when they think about buying a particular brand Voice share – share of media space or time the brand has of the total media share for that industry, often measured simply as dollar spent on advertising. Innovation Share – Company’s R&D expenditure as a percentage of the This is a long term indicator of new product innovation and this market share Competitors: Porter’s 5 forces that shape competition
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- Buyer Power (B2B) – How much power does the buyer have over quality, price and supply? - Supplier Power – How much power does the supplier have over quality, price and supply?| - Barriers to entry – Is it relatively difficult or easy to enter the market? (easy is bad for business!) - Current competitors – who else is playing in the market,? Are they strong? Weak? Monopoly? - Substitutes – Do substitute goods exist? Are they available (subs are bad for business) Competitors: 3 Force model - o Form part of the vertical – are partnered in B2B o 2 forces are eliminated - Barriers to entry – is it relatively easy to enter the market? (easy is bad for business) - Current Competition – Who else is playing in the market? Are they strong? Weak? Monopoly? - Substitutes – Do substitute goods exist? Are they available? (subs are bad for business) Environmental Analysis: CPESSTL-N - Competitors – How is the competitive environment? -
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Chapter 2 notes - Chapter 2 Market Orientation Competitive...

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