Transcript Chapter 1

MKTG 201
2
CHAPTER
Designed by
Amy McGuire, B-books, Ltd.
Chapter 2
Strategic Planning for
Competitive Advantage
Prepared by
Deborah Baker, Texas Christian University
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved
1
Competitive Advantage
Identify sources
of competitive
advantage
Chapter 2
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2
Competitive Advantage
Competitive
Advantage
Chapter 2
The set of unique features of a
company and its products that
are perceived by the target
market as significant and
superior to the competition.
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved
3
Competitive Advantage
Cost
Types of
Competitive
Advantage
Product/Service
Differentiation
Niche Strategies
Chapter 2
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved
4
Cost Competitive
Advantage
Cost
Competitive
Advantage
Chapter 2
Being the low-cost
competitor in an industry
while maintaining
satisfactory profit
margins.
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5
Cost Competitive
Advantage
 Obtain inexpensive raw
materials
 Create efficient plant
operations
 Design products for ease
of manufacture
 Control overhead costs
 Avoid marginal customers
Chapter 2
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6
Sources of Cost Reduction
Experience Curves
Product Design
Efficient Labor
Reengineering
No-frills Products
Production Innovations
Government Subsidies
New Service
Delivery Methods
Chapter 2
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7
Product/Service Differentiation
Product/Service
Differentiation
Competitive
Advantage
Chapter 2
The provision of
something that is unique
and valuable to buyers
beyond simply offering a
lower price than the
competition’s.
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8
Examples of
Product/Service Differentiation
 Brand names
 Strong dealer network
 Product reliability
 Image
 Service
Chapter 2
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9
Niche Competitive
Advantage
Niche
Competitive
Advantage
Chapter 2
The advantage achieved
when a firm seeks to
target and effectively
serve a small segment of
the market.
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10
Niche Competitive
Advantage
 Used by small companies
with limited resources
 May be used in a limited
geographic market
 Product line may be
focused on a specific
product category
Chapter 2
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11
Sources of Sustainable
Competitive Advantage
Patents
Copyrights
Locations
Equipment
Technology
Skills and Assets
of an
Organization
Chapter 2
Customer Service
Promotion
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