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Market leader.

Market leader. Holds largest market share. Many industries contain one firm that is the acknowledged market leader. Ex.Microsoft (Computer software),Intel (Microprocessor),Gilette(Razor blades),Visa(Credit cards). Problems.

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Market leader.

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  1. Market leader. • Holds largest market share. • Many industries contain one firm that is the acknowledged market leader. • Ex.Microsoft (Computer software),Intel (Microprocessor),Gilette(Razor blades),Visa(Credit cards).

  2. Problems • Unless a dominant firm enjoys a legal monopoly, its life is not altogether easy. It must maintain constant vigil. • Product innovations might hurt the leader (Nokia’s and Erricson’s digital cell phones took over from Motorola’s analog models).Maruti Vs Ambassador and premier padmini.)HMT vs Titan • All-Out liquid vaporizers. • The leader might misjudge its competitors and left behind.(Eg. Sears to Kmart and then Wal-Mart, All-out).

  3. To remain no. 1 • The firm must find ways to expand the total market demand. • The firm must protect its current market share through good defensive and offensive actions. • The firm can try to increase its market share even when it is constant.

  4. Expanding total market demand • New customers (market-penetration-sachet marketing,new-market-segments-Dabur Honey,geograhical expansion). • More Usage ( Soft-drinks,500 ml,Qantity,Frequnecy, Colgate,Oral-B,Gillete Mach-3).

  5. Defending market share • Continuous innovations. • Sony.

  6. 6 Six Types of Defense Strategies • Position defense • Flank • Preemptive • Counteroffensive • Mobile • Contraction

  7. Position defense • It includes building superior brand power, and making the brand almost impregnable (Impossible to capture or enter by force ). • Ex.Nescafe,Mercedes,Amul,

  8. Flank(A lateral part or side ) defense • The market leader should also erect outposts to protect weak front or possibly serve as an invasion base for counterattack. • Ex. Smirnoff (Brand of Heublein) which had 23% of market share of vodka market in US was attacked by low-priced Wolfschimdt,Heublein raised the price and put the increased revenue into advertising. • At the same time, Heublin introduced another brand,Relska to compete with Wolfschmidt and Popov ,to sell less than Wolfschmidt.

  9. Preemptive defense. • It’s the more aggressive move with attacking before the enemy starts its offense. • Preannouncements.(Microsoft). • Bank of America (ATM’s).

  10. Counteroffensive defense. • When attacked , most market leaders will respond with a counterattack. • In a counteroffensive, the leader can meet the attacker frontally or hit its flank . • An effective counterattack is to invade the attacker's main territory so that it will have to pull back some of its troop to defend its territory.

  11. Mobile defense • In this the leader stretches its domain over new territories that can serve as future centers for defense and offense through market broadening and market diversification. • Market broadening involves shifting focus from the current product to the underlying need.Ex. ITC ltd (diversification).

  12. Contraction defense • Large companies sometimes recognize that they can no longer defend all of their territory. • The best course of action then appears to be planned contraction (also called strategic withdrawl).Ex. Hindustan motors.

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