Chapter 18: Creating Competitive Advantage

Question 1

Competitive advantage

Answer 1

an advantage over competitors gained by offering consumers greater value

Question 2

Competitor analysis

steps in analyzing competitors

Answer 2

Identifying key competitors;
assessing their objectives, strategies, strengths and weaknesses, and reaction patterns;
selecting which competitors to attack or avoid

Question 3

Competitive marketing strategies

Answer 3

strategies that strongly position the company against competitors and give it the greatest possible competitive advantage

Question 4

Strategic group

Answer 4

a group of firms in an industry following the same or a similar strategy

Question 5

Benchmarking

Answer 5

comparing the company’s products and processes to those of competitors or leading firms in other industries to identify best practices and find ways to improve quality and performance

Question 6

Customer value analysis

Answer 6

an analysis conducted to determine that benefits target customers value and how they rate the relative value of various competitors’ offers

Question 7

Market leader

Answer 7

the firm in an industry with the largest market share

• expand total market
• protect market share
• expand market share

Question 8

Market challenger

Answer 8

a runner-up firm that is fighting hard to increase its market share in an industry

• full frontal attack
• indirect attack

Question 9

Market follower

Answer 9

a runner-up firm that wants to hold its share in an industry without rocking the boat

• follow closely
• follow at a distance

Question 10

Market nicher

Answer 10

a firm that serves small segments that the other firms in an industry overlook or ignore

• by customer, market, quality-price, service
• multi niching

Question 11

Competitive Market Positions and Roles

Answer 11

1. Market leader: 40%
2. Market challengers: 30%
3. Market followers: 20%
4. Market nichers: 10%

Question 12

Evolving Company Orientations

Answer 12

customer-centered vs competitor-centered

Question 13

Competitor-centered company

Answer 13

a company whose moves are mainly based on competitors’ actions and reactions.

Question 14

Customer-centered company

Answer 14

a company that focuses on customer developments in designing its marketing strategies and delivering superior value to its target customers.

Question 15

Market-centered company

Answer 15

a company that pays balanced attention to both customers and competitors in designing its marketing strategies.