1. Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Strategies for Growth Markets 9 C H A P T E R NINE

2. 9-2 Growing Markets are Attractive oBecause: oGaining share is easier oShare gains are worth more oPrice competition is likely to be less intense oEarly entry may be necessary to keep pace with technology

3. 9-3 Market Shares of the Leader and Followers over the Life Cycle of a Hypothetical Market Exhibit 9.1 Market Shares of the Leader and Followers over the Life Cycle of a Hypothetical Market Introduction Growth Early Maturity Maturity $ Sales Volume Life cycle stages

4. 9-4 Share Maintenance and Facts oDynamics of a growth market oIncreasing number of competitors oFragmentation of market segments oThreat of product innovation from within and outside the industry oFirm can maintain its current share position in a growth market: oIf its sales volume continues to grow

5. 9-5 Marketing Objectives for Share Leaders oMaintaining/improving satisfaction and loyalty oEncouraging/simplifying repeat purchase oReducing attractiveness of switching oHead-to-head positioning against competitive or potential offerings oDifferentiated positioning against competitive or potential offerings

6. 9-6 Maintaining/Improving Satisfaction and Loyalty oIncrease attention to quality control as output expands oContinue product modification and improvement oIncrease salesforce’s servicing of current accounts oExpand postsale service capabilities

7. 9-7 Encouraging/Simplifying Repeat Purchase oExpand production capacity in advance oImprove inventory control and logistics systems oContinue to build distribution channels oConsider developing automatic reorder systems

8. 9-8 Reducing Attractiveness of Switching oDevelop a product line with appealing features oDevelop multiple-line extensions oMeet or beat lower prices

9. 9-9 Head-to-head Positioning against Competitive Offerings oDevelop a product line with more features oMake product modifications oMeet or beat lower prices oWhen resources are limited consider withdrawing from smaller segments

10. 9-10 Differentiated Positioning against Competitive Offerings oDevelop multiple-line extensions oBuild unique distribution channels oDesign multiple advertising

11. 9-11 Strategies for Share Leaders oFortress defense oFlanker defense oConfrontation oMarket expansion oContraction or strategic withdrawal

12. 9-12 Strategic Choices for Share Leaders in Growth Markets Exhibit 9.4 Strategic Choices for Share Leaders in Growth Markets Source: Kotler and Achrol, 1981 COMPETITOR OR POTENTIAL COMPETITOR Contraction or strategic withdrawal Market expansion Flanker strategy - Proactive Flanker strategy - Reactive LEADER Fortress or position defense strategy Confrontation strategy Proactive Reactive

13. 9-13 Marketing Actions to Achieve Share-Growth Objectives oHead-to head positioning against competitor’s offering in primary target market oTechnological differentiation from target competitor’s offering in primary target market oHead-to-head positioning against target competitor’s offering in established market segments oDifferentiated positioning focused on underdeveloped segments

14. 9-14 Strategies for Followers oFrontal attack oLeapfrog oFlank attack oEncirclement

15. 9-15 Strategic Choices for Challengers in Growth Markets Exhibit 9.8 Strategic Choices for Challengers in Growth Markets TARGET COMPETITOR Flanking attack Frontal attack Encirclement strategy Leapfrog strategy CHALLENGER Source: Kotler and Acrhol, 1981 Guerrilla attacks