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MKT 100 Study Guide - Research And Development, Competitor Analysis, Financial Audit

5 pages48 viewsWinter 2011

Department
Marketing
Course Code
MKT 100
Professor
Paul Finlayson

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MODULE 2
ANALYZING COMPETITION
Market orientation: chance flavours the prepared mind and an organization that
gathers market intelligence, analyze it, disseminates it, learns from it and then
responds to it is favoured by chance.
Four different supply environments:
1. NO COMPETITON
Single supplier of a particular product that has control over price, quality
and quantity supplied
Monopoly is government regulated and undertakes financial audit and
customer satisfaction surveys to see if it is making profits and satisfying
customers
Shifting away from monopoly and towards oligopolies because
competition gives customers choice, which encourages innovation
and price competition
2. OLIGOPOLISTIC COMPETITON
Market dominated by few large suppliers
Evolve industries that require very large investments in equipment,
technology and/or distribution
Compete on price, product feature, advertising and sales promotion
3. MONOPOLISTIC COMPETITION
Many suppliers offering variety of products, each with small, loyal market
share
Product and service differentiation between rivals as well as price
competition
4. PERFECT COMPETITION
Many suppliers sell same product
Supply and demand control price; advertising has little influence
Market share measured as percentage of total sales over specified time period
Levels of competition
Product category competition (share specific design features and target
same customers)
Core benefit competition (share some similar features)
Budget competition
Emphasis should be on commercializing and diffusing of new innovation into
market; measuring number of competitors, market share, and balance sheet of major
competitors
Focus on new product or process technology to increase customer
satisfaction and reduce cost
Indicators of change in future sales, profits, and competitiveness:
1. CHANGING BRAND MIND-SHARE
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MODULE 2
Change share (%) of customers who name the first brand that comes to
mind when buying a product
Indicates top-of-mind brand awareness and preferences
Foreshadows change in market sales share
2. CHANGING BRAND VOICE-SHARE
Changing share of advertising dollars brad has of total dollars spent on
advertising market
3. CHANGING RESEARCH AND DEVELOPMENT (R&D)
Changing share company R&D expenditure has of total industry R&D
expenditure
Direct correlation between R&D spending and successful innovation not
always high; depends on creativity
Porters five forces that shape competition:
1. Current competitors
2. Threat of new entrants
3. Threat of new substitutes
4. Bargaining power of distributors (B2B customers)
5. Bargaining power of suppliers
In marketing perspective, porters model reduced down to three forces
oSuppliers and distributors are generally treated not as rivals, but as business
partners in an added-value chain with whom you form an alliance to gain
collective and individual competitive advantage
Competitive audit reports current success stories, mistakes, competitive advantages
and disadvantages of a competitor
Competitive advantage in product quality and costs can come from one or more
stages of added-value chain of processes:
Supply
processes
Manufacturin
g operations
processes
Distribution
processes
Marketing
and sales
processes
Sales
process
es
ANALYZING CHANNELS
New technology is the biggest driver of change in channels of distribution
Three stages individual distributor audit:
1. Performance metric analysis
Retail margin = sales/average inventory
Dollar contribution per square foot and per employee and customer repeat
purchase intention
2. Fit analysis
Market fit and product differentiation fit
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