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Chapter 8

Chapter 8. Tailoring Strategies to Fit Specific Industry and Company Situations. Life Cycle. Unit Sales. Profits. Life Cycle. Emerging Embryonic Introduction. Growth. Mature. Decline. Industry Life Cycle. Industry Life Cycle. Industry Life Cycle. Industry Life Cycle.

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Chapter 8

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  1. Chapter 8 Tailoring Strategies to Fit Specific Industry and Company Situations

  2. Life Cycle Unit Sales Profits

  3. Life Cycle Emerging Embryonic Introduction Growth Mature Decline

  4. Industry Life Cycle

  5. Industry Life Cycle

  6. Industry Life Cycle

  7. Industry Life Cycle

  8. Industry Life Cycle

  9. Industry Life Cycle

  10. Challenges of Emerging Industries • Uncertain market conditions and characteristics • Competing/unknown proprietary technologies and varied marketing/service/distribution tactics • Lack of complementary products • Limited/poor quality and high costs, which deter acceptance • Low entry barriers • Education of users • Innovators vs. Initial adopters vs. Mass-market.

  11. Alternatives in Emerging Industry • Move fast/early with superior product or technology • Track the Dominant Design • Build alliances/merge with key suppliers or those that provide complementary products to out position rivals • Seek new customer groups, new applications for your product • Make it cheap/easy for early adopters to try/buy your product.

  12. High Technology Industries • Battle over technical standard, format, and dominant design • Set by decree, cooperation, public domain, but mostly through consumer choices

  13. Benefits for Standards • Compatibility • Reduce consumer uncertainty • Reduce production costs • Increase in complementary products – Network effects – which greatly enhances sustainability • Lock outs and switching costs

  14. TV Industry – Paradigm Shifts Black & White TV

  15. Color TV Black & White TV

  16. Color TV Black & White TV

  17. Big Screen TV Color TV Black & White TV

  18. Big Screen TV Color TV Black & White TV

  19. HDTV Big Screen TV Color TV Black & White TV

  20. HDTV Incremental evolution included remote controls,cable ready tuners, stereo sound systems, screen-in-a-screen, etc Big Screen TV Color TV Black & White TV

  21. Challenges of Mature Industries • Slow growth fight for market share • Sophisticated buyers • Costs, prices and service critical • Excess capacity and oversupply • Innovation and new uses more difficult • International competition • Falling profitability • Consolidation • Segmentation.

  22. Alternatives in Mature Industries • Prune product line • Process innovation & cost reductions in value chain • Sell more to current buyers • Purchase rivals at low prices • Go international.

  23. Fragmented Industries • Low entry barriers • Lack of economies of scale • High segmentation • Local Advantages • Diverse preferences

  24. Alternatives in Fragmented Industries • Formula facilities – YUM Brands, Home Depot • Low cost operations - tires, pool suppliers • Become the specialized vendor of choice - oil change, lawn/garden, bar stools • Focus on a customer type - Hooters, Panera • Focus on a geographic segment - Winn-Dixie, Chic-fil-a, Sonic.

  25. Other Runner-up Strategies • Vacant Niche Strategy - commuter airline, health foods, religious book stores • Specialists Strategy - Arm & Hammer • Superior Products Strategy - Sub-Zero • Distinctive Image Strategy - Rainforest Cafe • Content Follower – Cadbury-Schweppes

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