The C company has chosen the two following strategies: To obtain differentiation of its products — differentiate it from the products of the competitors by covering special needs which the customers considers useful and valuable and integrating the corresponding characteristics in the product/services
The B company has chosen the following two strategies: To obtain cost dominance, i.e. the company which has the lowest production costs in the trade.
The A company has chosen the following two strategies: To obtain cost dominance, i.e. the company which has the lowest production costs in the trade.
Corresponding to the Competitive Triangle we will have some basic competitive strategies in the market place in relation to markets and competitors.
Even though industrial espionage is illegal and immoral, it is still legal to gather specific valuable information about your competitor:
An evaluation of the competitor’s competence will tell us about his ability to implement his strategies.
An important aim of the competitor analysis is to know about the competitor’s objectives as it will help to understand the competitor’s strategy. It gives the possibility to predict the next move of the competitor.
A thorough knowledge of the competitors (who does what and why) will help you gain time and money. Often a company only realises the importance of this the day when it loses an order to a competitor. Then it could be too late…
If we assume that the «Market» consists of customers who know of the product, who have tried the product and who are satisfied with the product (quality/performance and so on), we can calculate the market share in the three examples by multiplying the YES ratios with each other:
The market chart is a simple tool which can be used in a SWOT analysis to evaluate the market knowledge of the company’s product, the level of the market share, i.e. how many buys the product and finally how satisfied is the customer.
