Thesis: The Marketing Communication Strategy of Blue Bird Taxi... (Part 10)

To get a better understanding about this, please start reading from the first post of the series. 

THESIS: The Marketing Communication Strategy of Blue Bird Taxi To Maintain Market Leader Position After Using The Highest Tariff:

• Introduction & Book Cover   : Part 1
• Research Originality Statement and Acknowledgement   : Part 2
• Abstract                                          : Part 3
• Table of Contents                          : Part 4

• Chapter I       : part 5, part 6, part 7
• Chapter II      : part 8, part 9, part 10

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(Chapter II continued...)

2.5.      Competitive Advantage Marketing Strategies

Competitive advantage is the advantage over competitors gained by offering consumers greater value, either through lower prices or by providing more benefits that justify higher prices. (Kotler et al., 1999:107) Marketing strategies must consider the strategies of competitors as well as the needs of target consumers by doing a competitor analysis and developing competitive strategies. (Kotler et al., 1999:506)

2.5.1   Competitor Analysis

Competitor analysis is the process of:

-       identifying key competitors

-       assessing competitors objectives

-       assessing competitors strengths and weaknesses

-       assessing competitors strategies

-       assessing competitors reaction patterns

-       Selecting which competitors to attack or avoid.

To plan effective competitive marketing strategies, the company needs to find out all it can about its competitors. It must constantly compare its products, prices, channels and promotion with those of close competitors. In this way the company can find areas of potential competitive advantage and disadvantage. It can launch more effective marketing campaigns against its competitors and prepare stronger defenses against competitors' actions. (Kotler et al., 1999:506)

2.5.2   Competitive Strategies

Competitive strategies are strategies that strongly position the company against competitors and that give the company the strongest possible strategic advantage. (Kotler et al., 1999:506) The broad competitive marketing strategies that companies use are Competitive Position and Competitive Movement.

2.5.2.1 Competitive Position Strategy

Treacy and Wiersema suggest that companies gain leadership position by delivering superior value to their customer. Companies can pursue any of three strategies called Value Discipline for delivering superior customer value. (Kotler et al., 1999:517) These are:

-       Operational Excellence

The company provides superior value by leading its industry in price and convenience. It works to reduce costs and to create a lean and efficient value delivery system.

-       Customer Intimacy

The company provides superior value by precisely segmenting its markets and then tailoring its products or services to match exactly the needs of targeted customers. It serves customers who are willing to pay a premium to get precisely what they want, and it will do almost anything to build long-term customer loyalty and to capture customer lifetime value.

-       Product Leadership

The company provides superior value by offering a continuous stream of leading-edge products or services that make their own and competing products obsolete. It serves customer who want state-of-the-art products and services, regardless of the cost in terms of price or inconvenience.

            Some companies’ successfully pursue more than one value discipline at the same time. Treacy and Wiersema have found that leading companies focus on and excel at a single value discipline while meeting industry standards on the other two.

2.5.2.2 Competitive Moves Strategy

Businesses maintain their position in the marketplace by making competitive moves to attack competitors or defend themselves against competitive threats. These moves change with the role that firms play in the target market that of market leader, market challenger, market follower and market nicher. (Kotler et al., 1999:519)

Market leader is the firm in an industry with the largest share; it usually leads other firms in price changes, new product introductions, distribution coverage and promotion spending. The market leader competitive strategies are:

• First, find ways to expand total demand.
• Second, try to expand its market share further.
• Third, company can retain its strength by reducing its costs.
• Fourth, the firm must protect its market share through good defensive and offensive actions.

Market Challenger is runner-up firm in an industry that infighting hard to increase its market share. The market challenger competitive strategies are:

• attacking the leader and other competitors in an aggressive bid for more market share (market challengers)
• or they can play along with competitors and not rock the boat (market followers)

Market Follower is a runner-up firm in an industry that wants to hold its share without rocking the boat. The market-follower fall into one of three broad types:

• The Cloner, which closely copies the leader’s product, distribution, advertising and other marketing moves. It originates nothing; it simply attempts to live off the market leader’s investment.
• The Imitator, which copies some things from the leader, but maintains some differentiation with packaging, advertising, pricing and other factors.
• The Adapter, which builds on the leader’s product and marketing program, often improving them. The Adapter may choose to sell to different markets to avoid direct confrontation with the leader.

Market Nicher is a firm in an industry that serves small segments that the other firms overlook or ignore. Whereas the mass marketer achieves high volume, the nicher achieves high margins. The key idea in nichemanship is specialization along market, customer, product or marketing-mix lines.