1. Chapter #9

2. Nike

3. Nike Nike Market leader early product innovator outsource production spend lots of money on marketing Market leader early product innovator outsource production spend lots of money on marketing Puma Puma European stylish European stylish K-Swiss K-Swiss Hip image Hip image Vans Vans Niche market Skate boarders Niche market Skate boarders Sketchers Sketchers Cool younger market Cool younger market New Balance New Balance Older audience endorsed by no one Older audience endorsed by no one Adidas Adidas Leader in Soccer, recently acquired Reebok Leader in Soccer, recently acquired Reebok Starbury One Starbury One Low Price endorsed by Stephan Marbury Low Price endorsed by Stephan Marbury

4. Share Maintenance Share Maintenance Repeat business from current customers Repeat business from current customers Capture new customers Capture new customers Share growth Share growth Growth stage often short (8 years) Growth stage often short (8 years)

5. Opportunities and risks in a growth market It is easier to gain share when a market is growing It is easier to gain share when a market is growing Share gains are worth more in a growth market than in a mature market Share gains are worth more in a growth market than in a mature market Price competition is likely to be less intense Price competition is likely to be less intense Early participation in a growth market is necessary to make sure that the firm keeps pace with the technology Early participation in a growth market is necessary to make sure that the firm keeps pace with the technology

6. Gaining Share is Easier No established preferences/special needs not yet identified No established preferences/special needs not yet identified Established competitors less likely to act aggressively as long as their growth rate is satisfactory (Dell example) Established competitors less likely to act aggressively as long as their growth rate is satisfactory (Dell example)

7. Share Gains are worth more Can hold share as market grows Can hold share as market grows The existence of positive network effects The existence of positive network effects Future changes in technology (hd TV v Blue Ray) Future changes in technology (hd TV v Blue Ray)Blue Future competitive structure of the industry Future competitive structure of the industry Future fragmentation of the market Future fragmentation of the market

8. Early Entry Is Necessary for Technical Expertise Stents 5.3 billion in 2006 Johnson & Johnson 1994 Guidant 1997 (70%) J&J 2003 (huge demand) Boston Scientific 2004 (65% market share)

9. Market Leaders (retain current customers) Maintaining/Improving satisfaction and loyalty Maintaining/Improving satisfaction and loyalty Improve Quality Improve Quality Selective Product modification Selective Product modificationmodification Better service Better service Encouraging/simplifying repeat purchases Encouraging/simplifying repeat purchases Distribution Distribution Reducing attractiveness of switching Reducing attractiveness of switching Functional barriers to switching Functional barriers to switching Compete on Price Compete on Price

10. Market Leader (stimulate selective demand among later adopters) Head-to-head positioning Head-to-head positioning Fighter brand Fighter brandbrand Match competitor offering (confrontation strategy) Match competitor offering (confrontation strategy) Strategic withdrawal Strategic withdrawal Differentiated Positioning Differentiated Positioning Market expansion Market expansion New lines New lines New channels New channels New messages New messages

12. Followers deciding whom to attack Attack the market-share leader Attack the market-share leader Frontal or Leapfrog Frontal or Leapfrog Frontal Attack another follower Attack another follower Attack one or more smaller competitors who have limited resources Attack one or more smaller competitors who have limited resources Avoid direct attacks Avoid direct attacks Flanking (Citrus World) Flanking (Citrus World)World