Competition

Competition The rivalry among sellers trying to achieve such goals as increasing profits market share sales volume by varying the elements of the marketing mix: price, product, distribution, and promote The struggle among companies for scarce customer dollars

Direct Competition A situation in which two or more businesses offer products or services that are essentially the same; as such, the businesses are competing for the same potential market Example: LA/San Diego Chargers / LA Raiders Dominoes / Papa Johns Pizza

Indirect Competition The conflict between vendors whose products or services are not the same but that could satisfy the same consumer need. Example: Dominoes / KFC - indirect Dominoes / Papa Johns - direct

Factors That Influence Demand for a Sports or Entertainment event Price of the tickets How often the event takes place How much promotion is used People involved in event - (key players / performers)

Effect of Competition on businesses Develop new products Improve product quality Bring prices closer to production costs less profit is made per unit Operate more efficiently make as much profit per unit Provide better services customers are happy and return Provide wider selections

Types of Competition Price Competition: when a business uses the price of their product to compete in the marketplace two products which are substantially similar are judged by prospective consumers on their respective pricing, with the purchase made mostly on the basis of which is cheaper Non-Price Competition: when a business uses other product features: Quality image or service Market situation in which competitors would not lower prices for fear of a price war. Instead they focus on extensive promotions to highlight the distinctive benefits or features of their products.

Monopoly Monopoly: a situation in which there is only one company One supplier of goods/services No substitute products available No competition No price limits

Recreation Competition

Class Activity Identify 2 examples of Direct Competition & explain why i.e. Papa Johns & Dominoes Identify 2 examples of Indirect Competition & explain why i.e. KFC / Papa Johns Pittsburgh Pens / Washington Caps Answer the following: What types of direct and indirect competition exist in the SER industries? How does price competition impact the SER industries? How does non-price competition impact the SER industries? Why is competition good for SER consumers? If a business does not compete with price, what are some other ways it could compete? Why should competition research be an ongoing process for SER industries?