Lecture 5

Question 1

Competitive forces which influence an industry’s attractiveness, 6 forces create the profitability potential for an industry.

Answer 1

1. Potential entrants 2. Buyers 3. Complements 4. Suppliers 5. Substitutes 6. Rivalry among existing firms

Question 2

What is Competitive advantage

Answer 2

Something a company does that has value for consumers and that competitors cannot match.

Question 3

SWOT analysis

Answer 3

Strength, weakness, opportunity, threats

Question 4

Competitive advantages of different kind

Answer 4

Cost advantages: 1. Variable cost 2. Marketing expense 3. Operating expense
Differentiation advantage: 1. Product differentiation 2.Service quality 3. Brand reputation
Marketing advantage: 1. Product line advantage 2. Chanel advantage 3. market leader

Question 5

Components of market attractiveness

Answer 5

Market forces: market size, growth size, buyer power
competitive environment: No. of competitors, ease of competitor entry, Price rivalry
Market access: Customer familiarity, channel access, sales requirements

Question 6

offensive strategies for marketing plan

Answer 6

1. Invest to grow 2. Improve position 3. New market entry

Question 7

Defensive strategies for marketing plan

Answer 7

1. Protect position 2. Optimizing position 3. Monetize 4. Harvest/Divest

Question 8

Different market positions

Answer 8

1. Leader 2. Challenger 3. Follower 4. Nicher

Question 9

Resources: What the companies have

Answer 9

1. Customer relationship 2. CRM database 3. Brand equity 4. Distribution channel database 5. retail stores 6. Marketing communication creative platform 7. Marketing communication and media budget

Question 10

Capabilities: what can companies do?

Answer 10

1. Market sensing 2. Customer relationship management 3. Brand management 4. Channel relationship management 5. R&D 6. Market research 7. Marketing communication 8. Pricing flexibility

Question 11

Blue ocean strategy

Answer 11

• create uncontested market space
• Make the competition irrelevant
• Break the value cost break off
• Create and capture new demand

Question 12

Red ocean strategy

Answer 12

• compete in existing market space
• beat competition
• make value/cost break off
• exploit existing demand

Question 13

Offensive strategies which managers can use to target market leaders

Answer 13

• Comparative advertising
• first mover advantage
• imitation
• price

Question 14

Defensive strategies which managers can use to target market leaders

Answer 14

• Steadfast Marketing Support
• Strong Customer Relationships
• Market Coverage
• Legal Protection
• launch fighter brands
• Retaliation

Question 15

switching costs

Answer 15

Any negative repercussions that consumers would
experience should they switch brands or products, whether monetary,
psychological, social, or convenience-based.

Question 16

share of voice

Answer 16

A metric that measures a particular company’s level of media
spending as a proportion of the total media spend in the category.

Question 17

fast follower

Answer 17

A company that competes by imitating the innovation of other market competitors and bringing a product or service to market quickly, saving research and development costs and capitalizing on the innovation of others.

Question 18

network effects

Answer 18

Phenomena whereby goods or services become more valuable
when more people use them.