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MKT 100 Chapter Notes -Sultana (Grape), Convenience Store, Virtuous Circle And Vicious Circle

10 pages96 viewsWinter 2011

Department
Marketing
Course Code
MKT 100
Professor
Paul Finlayson

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Module 2
Section 1: Analyzing Competition
No competition: there is a single supplier of a particular product
oEg. Region electricity. Control the price, quality, and quantity supplied
Monopoly: government regulated
Trend is away from Monopolies, towards oligopolies
Oligopolistic competition: dominated by a few large suppliers
Usually require a very large investment in equipment, technology, and/or
distribution
oThese encourage mergers and acquisitions
Suppliers compete on price, product features, advertising and sales promotion
Eg of oligopolies, laptop computer market
Some oligopolies have fierce price and innovation completion, some dont
Monopolistic completion: suppliers offering a variety of products, each of which
has a small loyal market share
There exists a lot of product and service differences between rivals as well as price
completion
Eg, salad dressings, BBQ sauce, beauty salons and bars
Perfect competition: many suppliers sell essentially the same product.
Supply and demand will control the price
Sales and promotion will have little influence
Low cost production of a quality product and efficient distribution will determine
success
Eg. Thompson Seedless Grape producers
Competition: Who are our major competitors? Who has what share of sales in a
given market?
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Market Share: measured as a company’s percentage of total industry sales over a
specified time period
Market: specified by a realistic assessment of company resources and company
growth objectives
Closest and most immediate competition comes from rivals products that share
similar features (eg. Soft drinks)
General completion comes from products that satisfy a core benefit (eg. Thirst
quenching or pick-me-up drinks)
Historical prob with research in completion, too much focus on measuring the
onumber of current competitors
othe concentration of market share (The combined market share of the largest
four competitors)
othe current balance sheet of major competitors
Need more emphasis on
oCommercializing and diffusing of new innovation into the market
oWhich competitors are changing customer preferences and how and why?
oCompetitive insight, process thinking, why they have success
Sharepoint: percent of market share
You need to have a 360-degree long distance vision in a market to see the threat on
the horizon
Must look ahead
Leading indicators of a likely change in future sales, profits, and competitiveness:
oChanging brand mind-share: the changing share (%) of customers who
name the brand when asked to name the first brand that comes to mind
when they think of buying a particular type of product
oChanging brand voice-share: The changing share of advertising dollars
the brand has of the total dollars spent on advertising in the market. Brand
mind-share more important than brand voice-share
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oChanging research and development (R&D): the changing share the
company’s R&D expenditure has of the total industrys R&D expenditure
Michael Porters Five Forces Model
View suppliers and buyers more positively and reduce down the 3 forces
Suppliers and distributors, not treated as rivals
Auditing Current Competitors
Competitive Audit: reports on the current success stories, mistakes, competitive
advantages and disadvantages of a competitor
Porter, competitive advantage in product quality and costs can come from one or
more of the following stages of the added-value chain of processes:
oSupply processes to
oManufacturing operations processes to
oDistribution processes to
oMarketing and sales processes to
oService processes
Section 2: Analyzing Channels
Best practice is to research channels and look at trading relationships found in the
Distribution model
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