PharmaSimPharmaSimCOMPETITIVE STRATEGYCOMPETITIVE STRATEGY

Advanced Marketing Advanced Marketing ManagementManagement

Marketing 6202Marketing 6202

Competitive StrategyCompetitive Strategy

What is Strategy?What is Strategy?

Multi Functional activities that Multi Functional activities that support corporate goals by support corporate goals by delivering superior customer delivering superior customer valuevalue

What is Customer Value?What is Customer Value?

Customer Value = Benefits - Costs

Competitive StrategyCompetitive StrategyApproachesApproaches

DeliberateDeliberateRealized actions match intended Realized actions match intended coursecourse

EmergentEmergentStrategy is identified from Strategy is identified from

patterns or patterns or consistencies in past consistencies in past behaviorbehavior

Intended course may be changedIntended course may be changed

Competitive StrategyCompetitive StrategySituation AnalysisSituation Analysis

Demand-How/why do Demand-How/why do consumers buy?consumers buy?Population and segmentPopulation and segmentChannelsChannelsUsage ratesUsage rates

EnvironmentEnvironmentHealth issues and Health issues and symptomssymptomsEconomic-e.g. inflationEconomic-e.g. inflation

Information Sources

SURVEY – Decision Criteria

SURVEY – Tradeoffs

SURVEY – Brand Awareness

SURVEY – Purchase Intentions

SURVEY – Brand Perceptions

MARKET – Shopping Habits

MARKET – Share of Channel Sales

MARKET – Symptoms Reported

Competitive StrategyCompetitive StrategySituation AnalysisSituation Analysis

PerformancePerformanceMarket shareMarket shareCosts, resource allocationCosts, resource allocationMarginsMargins

ProductsProductsHow do consumers view How do consumers view them?them?New products?New products?

Marketing programsMarketing programsPricePricePromotionPromotionDistributionDistribution

Information Sources

MARKET – Share of Mfgr Sales

MARKET – Share of Channel Sales

SURVEY – Brands Purchased

MARKET – Brand Formulations

MARKET – Operating Statistics

MARKET – Sales Force

MARKET – Advertising

MARKET – Promotion

Competitive StrategyCompetitive StrategySituation AnalysisSituation Analysis

SWOTSWOTInternalInternal

StrengthsStrengthsWeaknessesWeaknesses

ExternalExternalOpportunitiesOpportunitiesThreatsThreats

Focus on trends – How are things Focus on trends – How are things changing?changing?

Competitive StrategyCompetitive StrategyProblems and Problems and OpportunitiesOpportunities

ProblemsProblemsFinancial performanceFinancial performanceCompetitor actionsCompetitor actionsProduct usage and Product usage and perceptionsperceptionsMarketing MixMarketing Mix

OpportunitiesOpportunitiesFragmenting marketFragmenting marketSubmarket/segment Submarket/segment growthgrowthFinancial resourcesFinancial resources

Information SourcesSURVEY – Decision Criteria

SURVEY – Tradeoffs

SURVEY – Brand Awareness

SURVEY – Purchase Intentions

SURVEY – Brand Perceptions

SURVEY – Segmented Reports

MARKET – Symptoms Reported

MARKET – Shopping Habits

MARKET – Brand Formulations

MARKET – Operating Statistics

COMPANY–Product Contributions

Competitive StrategyCompetitive StrategyProblems and Problems and OpportunitiesOpportunities

SegmentationSegmentationIdentify subgroups in the market that Identify subgroups in the market that act the sameact the sameDevelop profiles of the segmentsDevelop profiles of the segments

TargetingTargetingDetermine segment attractivenessDetermine segment attractivenessConsider “fit” with products and its Consider “fit” with products and its benefitsbenefitsSelect segment to targetSelect segment to target

PositioningPositioningDevelop marketing mix to appeal to each Develop marketing mix to appeal to each target segmenttarget segment

Competitive StrategyCompetitive StrategyEvaluate AlternativesEvaluate Alternatives

Does the alternative support your Does the alternative support your performance objectives?performance objectives?

e.g. Build market share, dominate new e.g. Build market share, dominate new segments, increase profits, increase segments, increase profits, increase distribution in a particular channeldistribution in a particular channel

Develop marketing mix for the Develop marketing mix for the alternativealternative

Product decisionsProduct decisions Sales forceSales forceChannels of DistributionChannels of Distribution AdvertisingAdvertisingPricingPricing

PromotionsPromotions

Can the alternative be implemented Can the alternative be implemented within your budget constraints?within your budget constraints?

Competitive StrategyCompetitive StrategyEvaluate AlternativesEvaluate Alternatives

Competitive ResponseCompetitive ResponseWhat should they be expected to do in What should they be expected to do in response to our alternatives?response to our alternatives?

MatchMatchCut priceCut priceExploit their strengthsExploit their strengths

Be mindful of competitor’s capabilities Be mindful of competitor’s capabilities and…and…

Pick the battleground, if you can

Competitive StrategyCompetitive StrategyMONITOR RESULTSMONITOR RESULTS

Financial and market Financial and market performanceperformance

Performance is driven by the ability to fulfill customer needs and wants, relative to the competition

Competitive StrategyCompetitive StrategyMONITOR RESULTSMONITOR RESULTS

Try to learn consumer responseTry to learn consumer response

Helps in determining resource allocation

by measuring the outcome variables

Advertising

Aw

are

ness

Competitive StrategyCompetitive StrategyMONITOR RESULTSMONITOR RESULTS

The longer you go, the more you The longer you go, the more you knowknow

Signal vs. noiseSignal vs. noise

Don’t “fight the last war”Don’t “fight the last war”

Things may change!

Competitive StrategyCompetitive StrategyISSUESISSUES

New product development – a long New product development – a long term keyterm key

Match the marketing mix to the Match the marketing mix to the target customertarget customer

Don’t forget about price sensitivityDon’t forget about price sensitivity

To stay ahead, you must continue To stay ahead, you must continue to get betterto get better

Competitive StrategyCompetitive StrategySituation AnalysisSituation Analysis

Demand-How/why do Demand-How/why do consumers buy?consumers buy?Population and segmentPopulation and segmentChannelsChannelsUsage ratesUsage rates

EnvironmentEnvironmentHealth issues and Health issues and symptomssymptomsEconomic-e.g. inflationEconomic-e.g. inflation

Information Sources

SURVEY – Decision Criteria

SURVEY – Tradeoffs

SURVEY – Brand Awareness

SURVEY – Purchase Intentions

SURVEY – Brand Perceptions

MARKET – Shopping Habits

MARKET – Share of Channel Sales

MARKET – Symptoms Reported