Follower Nicher Strategies.ppt

Nicher Strategies

1. Marketing Strategies for
Followers & Nichers
Strategic
Marketing

2. Competitive Dynamics: Kotler Model
Leader Challenger Follower Nicher
•Market Leader
•Market Challenger
•Market Follower
•Market Nicher
Kotler, 1996
30%40% 10%20%
Hypothetical Market Structure

3. Market Position
Matrix of Market Position/Managerial Resources
Quantitative managerial resources: number of sales force, input
financial power, production capacity, etc.
Qualitative managerial resources: corporate/brand image, marketing
power, technological power, leadership of top management, etc
Origin: Shimaguchi, Mitsuaki, Integrated Marketing, Nihon Keizai Shimbun, Inc., p.99

4. Market Follower
•Acompanythatallowsothermore
dominantfirmstoleadthewaywithin
themarketplacethatitdoesbusiness
in. -Businessdictionary

5. Followers

6. Follower Objectives
•Keep on surviving
–Totargetatamarketsegmentwhichisnotattractive
tohigh-rankingfirms,henceavoidingtheir
competitivechallenges
•Set sequence
–Toimitatetheleader’smarketingmixby
downgradingitbyonelevel
•Thorough cost reduction is indispensable.

7. Market Follower Strategies
•Counterfeiter
•Cloner
•Imitator
•Adapter

8. Counterfeiter
•Duplicatestheleader’sproduct&
packageandsellsitontheblack
marketorthroughdisreputabledealers
–India'spharmaceuticalcompanies
suggestedthatinIndia'smajorcities,one
infivemedicinessoldwasafake.

9. Counterfeiter statistics 1

10. Counterfeiter statistics 2

11. Cloner
•Thecloneremulatestheleader’s
product,distribution,advertisingand
soon.Theclonerproductand
packagingmayresembletheleader’s,
whilethebrandnamemaybeslightly
different.Parasiticallylivesoffthe
marketleader’sinvestments
–eg.BrandedApparels,Electronicgoods

12. Imitator
•Imitatorcopiessomethingoftheleader
butmaintainsdifferentiationinterms
ofpackaging,advertising,pricingand
soon.
•Theleaderdoesn’tmindtheimitatoras
longastheimitatordoesn’tattackthe
leaderaggressively
–Eg.KinderJoy&JemsSurprise

13. Adapter
•Adaptertakestheleadersproductsand
adaptorimprovesthem.
•Mayselectadifferentmarkettoavoid
directconfrontationwiththeleader
•Oftenadaptergrowsintothefuture
challenger
•Beststrategyunderuncertainity

14. Mobile Phone Manufacturers

15. TV Manufacturers

16. Market Nicher
•ANicheisamorenarrowlydefined
group,typicallyasmallmarketwhose
needsarenotbeingwellserved
•Nicheshaveadistinctandcompleteset
ofneeds;paysapremiumtothefirm
bestsatisfyingtheirneeds

17. Nicher Objective
•Maintainahighprofitratiointhe
limitednichesegment

18. Nichers Marketing Mix
•Marketing Mix
–Toprovideaspecificsegmentwithalimited
productlineofthequalityabovethemedium
levelatthepriceaboveamediumlevel
–Closed-typechannelpolicy
–Notrequiringanylarge-scalepromotion

19. Nichers Notabilia
•Topreventotherfirms’entryintothe
nichemarket
–Theniche’smarketsizeappearstoosmallfor
otherfirmstofindattractive
–Toenforceasegmentationthatnootherfirms
canthinkof
–Toleverageownuniquecapacitynootherfirms
possess

20. Market Nicher Strategies
•Low Volume, High Margin
•Specialization

21. Roles open to Nichers (Specialist)
–End-User
–Vertical-Level
–Customer-size
–Specific-customer
–Geographic
–Product or product-line
–Product-feature
–Job-shop
–Quality/price
–Service
–Channel

22. End-user Specialist
•The firm specializes in serving one
type of end use customer
–Support & Services, tele-support,
boutiques,
•Vertical Marketing
–Packaging product for end user

23. Vertical-level Specialist
•Thefirmspecializesatsomevertical
leveloftheproduction-distribution
valuechain
–Tailoring/EmbroiderywithBoutiques

24. Customer-size Specialist
•Thefirmconcentratesonsellingto
eithersmall,medium-sizeorlarge
customers

25. Specific-customer Specialist
•Thefirmlimitsitssellingtooneora
fewmajorcustomers
–Ancillaryunits

26. Geographic Specialist
•Thefirmsellsonlyinacertainlocality,
regionorareaoftheworld

27. Product or product-line Specialist
•Thefirmcarriesorproducesonlyone
productorproductline
–PlanetFashion

28. Product-feature Specialist
•Thefirmspecializesinproducinga
certaintypeofproductfeature
–Herbal

29. Job-shop Specialist
•Thefirmcustomizesitsproductfor
individualcustomers
–Tailors,Cobblers,Fashiondesigner

30. Quality/price Specialist
•Thefirmoperatesattheloworhigh
qualityendsofthemarket
–BrandedApparels(Mantra),Levis

31. Service Specialist
•Thefirmoffersoneormoreservices
notavailablefromotherfirms.
–Carwash

32. Channel Specialist
•Thefirmspecializesinserviceonly
onechannelofdistribution
–Teleshoppingbrands

33. Fundamental Strategies & Market Position

34. Competitive Strategies by Market Position

35. Questions?

36. Thank You