To turn your brand into a market leader or keep it in that position there are three strategies:
EXPANSION OF TOTAL MARKET DEMAND
As the total market demand increases, clearly the company that benefits is the one that maintains a leadership position within it and it is that position which forces it to look for:
– New customers: Attracting buyers to know a product, acquire it for its price or provide that attribute that is important for many.
– Greater use: Increase the quantity, level or frequency of consumption of a product. In addition to identifying additional opportunities to use the brand, based on the convenience and advantages of using a particular product, as well as the possibility of identifying completely new forms of use of a particular product, thus increasing the demand for other products derived from the product. same.
PROTECTION OF THE MARKET FEE
Clearly the market leader will always have to fight to defend its current business and protect it from competition, which is easily achieved when it is continually innovated in order to provide comprehensive solutions and perceived benefits to customers.
Proactive Marketing: Based on creative marketing, what is sought is to discover and generate solutions that consumers have not requested, but are well received, therefore the company drives the market with its creativity instead of being carried away by it and Their trends. We speak of two proactive skills: receptive anticipation, which consists of anticipating events and creative anticipation, which consists in devising innovative solutions.
Defensive Marketing: As its name implies, it does not leave spaces to be attacked by the competition, based on six strategies:
– Defense of the position: What is to occupy the most desired market space in the minds of consumers.
– Defense of flanks: Through some product manage to protect a weak front or support a possible counterattack.
– Preventive defense: Advance the competition and attack first by means of guerrilla actions throughout the market, destabilizing the competitors or managing to wrap or cover the entire market, leaving the competition to the margin.
– Counter-offensive defense: To deal directly with the competition and hit its weaknesses or take actions that allow it to be withdrawn in the market and gain a greater market share.
– Mobile defense: Extending to new territories by expanding or diversifying the market, thus achieving greater dominance.
– Shrink defense: Even when abandoning a market could be a bad sign, it is often a decision to abandon that weak market and focus all efforts on strong markets that will bring greater benefits.
INCREASE IN MARKET PARTICIPATION
While increasing market share can be an excellent strategy, it must be made clear that often the costs of doing so are too high, and perhaps revenues do not easily cover these costs, which is why four factors must be taken into account For this decision:
– The possibility of provoking antitrust actions: Avoid being considered by the competition as a monopoly as the company progresses in its participation in the market, because this brings with it legal demands and problems.
– The economic cost: Even if it does not seem obvious, increasing market share can also mean that profitability decreases, taking into account that non-buyers may not like the brand, be loyal to the competition …
– The danger of misleading marketing activities: For example, reducing competitor prices to increase market share may not bring significant benefits, as competition can easily offer similar prices or Take actions to retain their clients.
– The effect of increasing market share on real and perceived quality: When there is a large increase in market share there is also a greater use of company resources and therefore it requires a greater capacity to Serve them all, that if it does not have it can decrease the quality of the product or service and bring serious consequences for the sustainability of the company.
OTHER COMPETITIVE STRATEGIES
In the case of important and recognized organizations that are not leaders but are among the first positions it is possible to attack the leader and other competitors to increase their participation or to follow their normal path without disturbing the others:
In many cases this strategy yields excellent results gaining ground and even surpassing the leader of the market, this in part to that the position of the leader many times is of normality while the challengers are setting ambitious goals. Competitive Strategies:
– Definition of the strategic objective and identification of the opponent: Clearly the strategic objective will be to expand its market share and then decide which companies will attack the market leader (dangerous but profitable strategy if existing gaps are exploited), other companies Their size, not serving the market well and have financing problems or small local and regional companies.
– Selection of a general attack strategy: Front attack (equalize product, advertising, price and distribution of competition), flank attack (identify the gaps left by the leader to be able to satisfy them in a better way and take advantage of Eg areas where the leader does not serve the market well), invading attack (try to conquer much of the territory of the competition through a great offensive that touches everyone), bypass attack (ignore the enemy in the beginning to attack others first Simpler markets through diversification into unrelated products, geographic diversification and adoption of new technologies) guerrilla attacks (launch offensives such as selective price cuts, intense promotional bombings and occasional legal actions to harass the competition)
It often occurs in industries that require large investments and their products have little differentiation, so that trying to increase participation only generates reprisals between companies, and does not represent a significant benefit. However, in order to retain current customers and get new customers, there are a number of possible strategies:
– Falsifier: Reproduce the product and packaging of the leader and sell it on the black market.
– Cloner: Reproduces the product, name and packaging of the leader but makes some minor modifications.
– Impersonator: Copies some elements of the leading product, but their packaging, advertising, price or points of sale are different.
– Adapter: Take the leader’s products and adapt or upgrade them for your benefit.
In order to avoid becoming a follower company is the option of concentrating on a niche or limited market and take advantage of it, as they are often niches neglected by leading companies.
Marketing strategies throughout the product lifecycle: The strategy of differentiation and positioning must change as the product, the market and the competitors change throughout the product life cycle.
– Introduction phase and advantage of the pioneer: Due to the time to develop a product, solve its technical problems, direct it to distribution channels and achieve consumer acceptance, initially sales are usually low, added to all the high costs of promotion . Due to the ever shorter life cycles of products, the speed of innovation is becoming more important and being the pioneer in launching a product even when it has its risks, the benefits are greater because a high memory is generated Of the brand if it is satisfied with its product, in addition to capturing a greater number of users.
– Growth phase: Based on the increase in sales in this phase, it is essential to maintain this growth through product improvement, create new models, penetrate new market segments, increase distribution coverage and seek new Channels, modify advertising to increase consumer preference and in certain cases reduce the price to attract more buyers.
– Maturity phase: At this stage the growth in sales decreases but it is possible to use three mechanisms to change the course of a brand and not simply let it disappear. The possibility of modifying the market (trying to expand the market), modification of the product (modifying the quality, characteristics or style of the product), modification of the marketing program (price modification, distribution and communication)
Decline Phase: Sales decrease due to technological advances, changes in consumer tastes and intensification of competition, so if the company is in an industry that is unattractive and has sufficient competitive strength, it should consider the reduction Selective of its activity, contrary to if the company is in an attractive industry and possesses competitive force where it can consider a reinforcement of its investment. In itself, companies that manage to raise a mature product often do so by adding value to it.