The Length: of Unilever’s product mix refers to the number of items the company carries.
The Depth: of Unilever’s product mix refers to the number of versions offered of each product in the line.
The consistency: of the product mix refers to how closely related the various product lines are in the end use
Product improvements (MacIII- triple blade Razor)
product modifications (Diet Coke)
New brands through the firm’s own R&D efforts (Double Cola)
•Marketing objectives; maximum profit, High share, build customer loyalty.
•The market and demand
•Other external factors;
Setting a high price for a new product to skim maximum revenue from the segments willing to pay the high price; the company makes fewer but more profitable sales.
Market –Penetration Pricing
Setting a low price for a new product in order to attract a large number of buyers and a large market share.
Setting price steps between various products in a product line based on cost differences between the products, customer evaluations of different features and competitors and service line items.
Pricing optimal or accessory products sold with the main product.
Pricing products that must be used with the main product
Pricing low–value by-products or services to get rid of them
Pricing bundles of products sold together.
1.Customer segmented pricing
2.Product segmented pricing
3.Time segmented pricing
1.Special event pricing
2.Uniform delivered pricing
3.Freight absorption pricing
1.Initiating price increases
2.Buyer reaction to price changes
3.Responding to price changes (Competitors)
2.Channel management decision
2.Setting channel objectives and constraints
3.Identifying the major alternatives
4.Types of intermediaries
5.Company sales force
8.Number of intermediaries
d.Personal selling process
f.Public relations (Publicity)
4.Salesmanship ( Personal Selling)
Percent of sales
Objective and task
c.Cash refund offers
B.Competitive strategies for market leader
C.Market challenger strategies
E.Market Nicher strategies
Market Challenger (30% M.S)
Market Follower (20% M.S)
Market Nisher (10% M.S)
Defending market share
2.Extensive and efficient dealership system
5.Good financing to customers
Expanding market share
Position defense involves occupying the most desirable market space in the minds of the consumers, making the brand almost impregnable, like Wheel detergent/bar.
Al though position defense is important, the market leader should also erect outposts to protect a weak front or possibly serve as an invasion base counterattack. For example, Grameen Phone, even at the growth stage, kept the high price of per minute call and invested that additional amount in extensive advertising and building brand equity. Thus, it has made him still market leader by counterattacking the other competitors.
A more aggressive maneuver is to attack before enemy starts its offense. A company can launch a preemptive defense by several ways. It can wage guerrilla action across the market- hitting one competitor here, another there and keep every one off balance; or it can try to achieve grand market envelopment.
Counter Offensive Defense
When attacked most market leaders will respond with a counterattack. Counterattacks can take many forms. In a counteroffensive, the leader can meet the attacker frontally or hit its flank or launch a pincer movement. An effective counterattack is to invade the attacker’s main territory so that it will have to pull back to defend the territory.
In mobile defense, 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 underlying generic need.( Example. Petroleum companies get involved into oil, coal, nuclear and hydroelectric industries. Market diversification involves shifting into unrelated industries ( Reynolds, Philips, cigarette companies, moved to produce beer, liquor, soft drinks and frozen industries)
1.It can attack the market leader
2.It can attack firm of its own size that are not doing the job and are under financed.
3.It can small local and regional firms.
In a pure frontal attack, the attacker matches its opponent’s product, advertising, price, and distribution. A modified frontal attack, such as cutting price vis-a-vis convinces the market that it’s product is equal to the leaders product.
An enemy’s weak spots are natural targets. A flank attack can be directed along two strategic dimensions-geographic and segmental. In a geographic attack, challenger target the areas the leader’s product is under performing. Other flanking strategy is to serve uncovered market needs, as Japanese automakers did when they developed more fuel-efficient cars.
The encirclement maneuver is an attempt to capture a wide slice of the enemy’s territory through a “blitz”. It involves launching a grand offensive on several fronts. Encirclement makes a sense when the challenger commands superior resources and believes a swift encirclement will break the opponent’s will. In making a stand against rival Microsoft, Sun Microsystems licensed its JAVA software to hundreds pf companies and millions of software developers for all sorts of consumer devices. As consumer electric products began to go digital, Java started appearing in a wide range of gadgets.
The most indirect assault strategy is the bypass. It means bypassing enemy and attacking easer markets to broaden one’s resource based. This strategy offers three lines approach: diversifying into unrelated product, diversifying into new geographic markets, leapfrogging into new technologies to supplant existing products.
Guerrilla challenger uses both conventional and unconventional means of attack. These include selective price cuts, intense promotional blitzes, and occasional legal action. Normally Guerrilla warfare is practiced by smaller firm against larger one.
2.Lower price goods
3.Value-priced goods and services
5.Product proliferation (variety products)
9.Manufacturing cost reduction
10.Intensive advertising promotion
2.A market follower must know how to hold current customers and win a fair share of new customers. Each follower tries to bring distinctive advantage to its target market-location, services, financing. Because the follower is often a major target of attack by challengers, it must keep its manufacturing costs low and its product quality and services high. It must also enter new markets as they open up.
2.Cloner- The cloner emulates the leader’s product, name, and packaging, with slight variations.
3.Imitator- The imitator copies some things from the leader but maintains differentiation in terms of packaging, advertising, pricing, or location. The leader does not mind the imitator as long as the imitator attacks the leader.
4.Adapter- The adapter takes the leader’s products and adapts or improves them. The adapter may choose to sell to different markets, but often the adapter grows into the future challenger, as many Japanese firms have done after adapting and improving products developed elsewhere.
Nicher has three tasks:
2.Vertical-level specialist (Distribution value chain-A copper firm may concentrate on producing copper, copper components)
3.Customer size specialist (Small, medium or large size of customers)
4.Specific customer specialist(B2B)
6.Product or Product-line specialist (A firm may produce only lenses for microscope)
7.Product feature specialist (A firm specializes in producing a certain type of product feature)
8.Job-shop specialist (The firm customizes its product for individual customer
9.Quality Price specialist (The firm operates at the low or high-quality ends of the market)
10.Service specialist (a Bank that takes loan request over phone and hand deliver money to the customer)
11.Channel Specialist (The firm specialises in serving only one channel of distribution- exmp. A soft-drink company decides to make a very large-sized soft drink available only for gas station)