Market Strategies

1. Market Strategies

2. Market-Scope Strategy • Single-Market Strategy • Definition: concentration of efforts in a single segment. • Objective: To find a segment currently being ignored or served inadequately and meet its needs. • Requirements: a) Serve the market wholeheartedly despite initial difficulties. b) Avoid competition with established firms. • Expected results: low costs; higher profits • Multimarket Strategy • Definition: Serving several distinct markets. • Objective: To diversify the risk of serving only one market. • Requirements: a) Careful selection of segments to serve. b) Avoid confrontation with companies serving the entire market. • Expected results: higher sales; higher market share

3. Market-Scope Strategy - Continued • Total-Market Strategy • Definition: Serving the entire spectrum of the market by selling differentiated products to different segments in the market. • Objective: To compete across the board in the entire market. • Requirements: a) Employ different combinations of price, product, promotion and distribution strategies in different segments. b) Top management commitment. c) Strong financial position. • Expected results: increased growth; higher market share

4. Market-Geography Strategy • Local-Market Strategy • Definition: Concentrate efforts in immediate vicinity. • Objective: To maintain control of the business. • Requirements: a) Good reputation in the geographic area. b) Good hold on requirements of the market. • Expected results: short term success--need to expand • Regional-Market Strategy • Definition: Operate in a region. • Objective: To diversify risk of dependence on one part of a region and to keep control centralized. • Requirements: a) Management commitment to expansion. b) Adequate resources. c) Logistical ability to serve a regional area. • Expected results: increased growth; increased market share; keep up with competitors.

5. Market-Geography Strategy - Continued • National-Market Strategy • Definition: Operate nationally. • Objective: To seek growth. • Requirements: a) Management commitment. b) Capital resources. c) Willingness to take risks. • Expected results: increased growth, market share and profitability • International-Market Strategy • Definition: Operate outside national boundaries. • Objective: To seek opportunities beyond domestic business. • Requirements: a) Management commitment. b) Capital resources. c) Understanding of international markets. • Expected results: increased growth, market share and profitability

6. Market-Entry Strategy • First-In Strategy • Definition: First to enter the market. • Objective: To create an insurmountable lead. • Requirements: a) Willingness & ability to take risks. b) Technological competence. c) Strive to stay ahead. d) Heavy promotion. e) Create primary demand. f) Carefully evaluate strengths. • Expected results: reduced costs via experience; increased growth, market share and profits • Early-Entry Strategy • Definition: Enter shortly after the leader. • Objective: Stop the first entrant from creating a stronghold in the market. • Requirements: a) Superior marketing strategy. b) Ample resources. c) Strong commitment to challenge the market leader. • Expected results: increased growth, market share and profits

7. Market-Entry Strategy - Continued • Laggard-Entry Strategy • Definition: Enter during tail end of growth stage or during maturity stage as an imitator or initiator • Objective: Imitator - capture that part of the market that is not brand loyal. Initiator - serve the needs of the market better than present firms. • Requirements: Imitator: a) Market research ability. b) Production capability. Initiator: a) Market research ability. b) Ability to generate creative marketing strategies. • Expected results: Imitator - increased short term profits; Initiator - put market on a new growth path; increased profits; some growth opportunities.

8. Market-Commitment Strategy • Deals with level of financial and or management resources a firm is willing to commit to a market. • May be strong average or light • Intentional, or a matter of circumstances and competitive forces?

9. Market-Dilution Strategy • Demarketing Strategy • Definition: Discouraging customers from seeking the product. • Objective: To maintain customer goodwill during periods of shortages. Requirements: a) Monitor customer time requirements. b) Ration product supplies. c) Divert customers with an immediate need to customers who have a supply but no immediate need. e) Find out and suggest alternative products for meeting customer needs. • Expected results: increased long term profits; strong customer goodwill and loyalty • Pruning-of-Marginal-Markets Strategy • Definition: Weeding out markets with unacceptable rates of return. • Objective: To divert investments in growth markets. • Requirements: a) Gain good knowledge of the chosen markets. b) Concentrate all energies on these markets. c) Develop unique strategies to severe the chosen markets. • Expected results: long-term growth; improved ROI; decrease in market share.

10. Market-Dilution Strategy - Continued • Key-Markets Strategy • Definition: Focus on selected markets. • Objective: To serve the selected markets extremely well. • Requirements: a) Gain good knowledge of the chosen markets. b) Concentrate all energies on these markets. c) Develop unique strategies to severe the chosen markets. • Expected results: increased profits; increased market share in the selected markets • Harvesting Strategy • Definition: Deliberate effort to let market share slide. • Objective: To generate additional cash flow, increase short-term earnings or avoid antitrust action. • Requirements: High market share. • Expected results: sales decline but useful revenues still occur.