COMPETITIVE STRATEGIES

FOR MARKET FOLLOWERS…

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CONTENT Introduction Hypothetical market structure Market followers Market-follower strategies Four broad strategies Advantages References

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INTRODUCTION

The rule of business is that when you are a market leader, there are definitely going to be market followers. Many companies come out with a market follower strategy. In fact, in today’s world the competency of all companies are so high that innovations are quickly copied or imitated in different formats.

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HYPOTHETICAL MARKET STRUCTURE

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40%

30%

20%

10%

Market Leader

Market Challengers

Market Followers

Market Nichers

MARKET FOLLOWERSA market follower position can be profitable

as it may be possible to take a share of the large market created by the market leader, for example by copying the brand leader at a lower price, or making something better or cheaper.

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“Leaders think and talk about the solutions. Followers think an talk about their problems”

-Brian Tracy-

MARKET-FOLLOWER STRATEGIES

Each follower tries to bring distinctive advantages to its target market - location, services, financing.

Four Broad Strategies• Counterfeiter• Cloner• Imitator• Adopter

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Four Broad Strategies Counterfeiter Copies the leader’s product and packages and sells it on the black market.E.g. : pirated music/ movie CDs

ClonerCopies the leader’s product s as it is as well as name, packaging with slight variations.E.g. the IBM PC clones

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Four Broad Strategies..(cont..) ImitatorCopies some of the things from leader’s product but maintains difference in packaging, and other factors.E.g. car manufacturers imitate the style of one another. AdapterLaunches improved products over that of the innovator’s.E.g. many Japanese firms are excellent adapters initially before into challengers and eventually leaders

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ADVANTAGES

Learn from the market leader’s experience

Copy or improve on the leader’s offerings

Strong profitability

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References.. Principles and Practice of Marketing -By Jim Blythe

Strategic Marketing: Creating Competitive Advantage - By Douglas West, John Ford, Essam Ibrahim

Strategic Marketing Planning - By Colin Gilligan, Richard M.S. Wilson

Market-Driven Management: Strategic and Operational Marketing - By Jean-Jacques Lambin, Isabelle Schuiling

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Any Question?

Thank You..

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