Areas of Competition
Areas of competition refer to the specific aspects in which businesses vie for market share and consumer attention. These areas can include pricing, product quality, customer service, innovation, and marketing strategies. Understanding and effectively competing in these areas is crucial for businesses to differentiate themselves and gain a competitive edge in the market.
4 Key excerpts on "Areas of Competition"
eBook - ePub- George Stonehouse, Bill Houston(Authors)
- 2003(Publication Date)
- Routledge(Publisher)
...Accordingly, in some ‘arenas’, businesses compete, whereas in others they may work together. At the root of this understanding is the fact that organizations and industries are open systems – they interact with many environments. The ‘arenas’ in which an organization operates are the following. Industry – the industry within which the organization currently deploys its resources and competences in producing products. Resource markets – the markets from which the organization, its competitors and other industries obtain their resources. Product markets – markets in which the organization sells its products. These can be subdivided into markets for the organization's products, markets for substitute products, and new markets into which the organization may be considering entry. Other industries – where businesses possess similar competences to those of the organization. Such industries are important for two reasons. The first is that the business may be considering entry to them. The second is that the organizations in these industries are potential competitors who may enter the business's industry and markets. Each of these arenas must be analysed as they directly affect an organization's competitive positioning and hence its chances of outperforming competitors. The competitive and collaborative arena framework builds upon Porter's five forces framework but explicitly recognizes that the competitive environment is divided into four separate but inter-related arenas. A resource-based approach to environmental analysis Limitations of existing frameworks of analysis This chapter has so far concentrated on explaining the traditional strategic management frameworks employed in the analysis of the competitive environment. The resource-based approach to strategic management, which emphasizes the importance of core competence in achieving competitive advantage, employs a different approach to analysis of the competitive environment...
eBook - ePubMarketing Management
Text and Cases
- Robert E Stevens, David L Loudon, Bruce Wrenn(Authors)
- 2012(Publication Date)
- Routledge(Publisher)
...Chapter 3 Competitive Analysis In this chapter we address the second element of what marketing managers must understand: competition (see Figure 3.1). After analyzing the needs of consumers or organizational buyers in specific market segments, the next step in the marketing analysis process is to analyze competition for each of the specific market segments. For new products that represent innovation, this analysis may be limited to potential competition rather than identifiable competitors. In most cases, however, an established market with clearly identified competitors must be evaluated for its strategies, strengths, and weaknesses. Figure 3.1. The Effective Marketing Management Process This chapter presents the concepts and tools needed to analyze competition for existing markets. Especially useful is the marketing mix audit form, which permits evaluation of a competitor on all the basic strategy elements. Purpose of Competitive Analysis One fundamental question must be asked when undertaking competitive analysis: Which competitors are going after which market segments with what marketing strategies? The focus is on specific market segments that have been isolated through consumer analysis. At this point, managers should already know the size (potential) and the characteristics of each segment. The analysis begins to deal with competition on a segment-by-segment basis. Managers must uncover segments that are not currently being served, or segments that are not being served well by competition. In markets where competitors do not have clearly identifiable strategies and each seems to be using a strategy similar to the others, there are usually several segments that can be better served through strategies aimed directly at their needs. For example, the hair shampoo market was once characterized by only two broad categories of shampoo—dandruff and nondandruff...
- Diana Luck(Author)
- 2010(Publication Date)
- Routledge(Publisher)
...Where would (a) you and (b) your organization draw the line that defines ethical behaviour? SUMMARY Summary of Chapter 3 In this chapter we have dealt with the following important aspects: The nature and implications of competition in fragmented and concentrated industries. The importance of monitoring the actions and reactions of competitors. An appreciation of the five forces required in a structural analysis of industry profitability. A practical framework for assessing the intensity of market competition and changes over time. The regulatory framework relating to competition. The need for an information system and the important sources of information required for a competitor analysis. Competitive activity involves more than the price variable. Choice between alternatives is the key as firms compete on service, innovation and non-price variables. Large firms predominate in concentrated industries due to the importance of barriers to entry in which economies of scale figure importantly. Smaller firms are the product of more fragmented structures, although profitable niches can be found in most markets. Concentrated and fragmented industries also interact. In the United Kingdom between 1993 and 2000, an estimated one-fifth of all corner shops, high-street banks and post offices disappeared. The rate of this decline is accelerating. The need to monitor competitors, while providing some predictions of competitive response, only takes account of rival firms within the market. More thorough analysis requires consideration of several groups in the micro-environment. HINTS AND TIPS The competitive environment confronts virtually all organisations in some way or another and is a great concern for the marketer...
eBook - ePub- Ian Smith(Author)
- 2012(Publication Date)
- Routledge(Publisher)
...Some of you who have always operated on the principle that you were not in a competitive environment may find it disturbing to consider that competition exists for you, too. This chapter will help you understand the nature and scope of competition – whatever form it takes. In most cases this will exist within a market-place of some sort but it is a mistake to assume that markets apply to every situation. Where markets do not exist, understanding how provision is shared between organizations or agencies will help improve delivery to customers or clients. In a number of circumstances competitors will not be competing on the basis of shared or similar provision (see below). What do we mean by competitors? Competitors are individuals, groups or organizations that provide alternatives to what you provide. They may offer these alternatives in a non-competing way and you may coordinate the provision with your competitors. If that is the case it will be easier to work with these providers to explore the differences between your provision, how the customers choose and how well you cover the spread of needs within your combined customer base. What you learn here is still important. However, you may be in a situation of true competition where the alternative providers are seeking to win customers from you and you are seeking to do the same to them. Please note: In some circumstances, notably in internal situations and in many bureaucracies, competitors will be competing to win resources, not customers. Departments and individuals who develop strong, customer-facing management practices will, as a by-product, strengthen their position within their organization. However, the competing for resources to the detriment of other departments within that organization is seldom the most constructive type of activity to pursue and usually deflects from the core purposes of the organization itself...
