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Chapter 5 Marketing Strategies

The document discusses four different market strategies: market leader, market challenger, market follower, and niche market. A market leader dominates its industry with substantial market share and innovative products. A market challenger targets industry leaders aggressively to gain share. Market followers stay in strong positions without expensive R&D or risks. Niche markets focus intently on select customer segments to better meet their needs.

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Masood khan
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50 views13 pages

Chapter 5 Marketing Strategies

The document discusses four different market strategies: market leader, market challenger, market follower, and niche market. A market leader dominates its industry with substantial market share and innovative products. A market challenger targets industry leaders aggressively to gain share. Market followers stay in strong positions without expensive R&D or risks. Niche markets focus intently on select customer segments to better meet their needs.

Uploaded by

Masood khan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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CHAPTER 5

1. MARKET LEADER

2. MARKET CHALLENGER

3. MARKET FOLLOWER

4. NICHE MARKET
1. MARKET LEADER

 The market leader is dominant in its


industry.

 It has substantial market share and


extensive distribution arrangements.

 It is typically the industry leader in


developing innovative new products and
business methods.
1. MARKET LEADER

 However it is in a very visible position and


can be the target of competitive threats

 Research ( in the 1970s) concluded that


market leadership was the most profitable
strategy in most industries.

 Today we recognize that other strategies


can also be effective.
1. MARKET LEADER
The main options available to market leaders are:

 Expand the total market by finding new users or new uses of


the product

 Expand the total market by encouraging more usage on each


use occasion

 Protecting market share by developing new product ideas,


improving customer service

 improving distribution effectiveness

 Expanding market share by targeting one or more competitor


2- MARKET CHALLANGER

 A market challenger is an organisation a


strong, but not dominant position that is
following an aggressive strategy of trying to
gain market share.

 It typically targets the industry leader.


2- MARKET CHALLANGER
The main principles involved are:

 Assess the strength of the target


competitor.
 Choose only one target at a time.
 Find a weakness in the target’s position.
 Consider how long it will take for the target
to realign their resources so as to reinforce
this weak spot.
2- MARKET CHALLANGER

Some of the options open to a market


challenger are:

 Discounting or price cutting

 Product line extensions

 New product introduction


2- MARKET CHALLANGER

Some of the options open to a market challenger


are:
 Increase product quality
 Improve service
 Find new distribution channels
 Improve and intensify promotional activity
3- MARKET FOLLOWER

 A market follower is a firm in a strong, but not


dominant position that is content to stay at that
position.

 The advantages of this strategy are:

 No expensive R&D failures

 No risk of bad business model

 Best practices? are already established


3- MARKET FOLLOWER

 Able to capitalize on the promotional


activities of the market leader

 Minimal risk of competitive attacks

 Don’t waste money in a head-on battle


with the market leader
4- NICHE MARKET

 In this niche strategy the firm concentrates on a


select few target segments.

 This is also called a focus strategy.

 The objective is focusing marketing efforts on


one or two narrow market segments and
tailoring the marketing mix, the organisation
can better meet the needs of that target
market. 
4- NICHE MARKET

The most successful nichers tend to have the


following characteristics:

 They tend to be in high value added


industries and are able to obtain high
margins.

 They tend to be highly focussed on a


specific market segment

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