Different Levels of Competition in Marketing
When formulating a marketing strategy, competition is a very important factor to be considered. Too often, vendors tend to identify their competition within very broad boundaries. For instance, Black & Decker can certainly be said to be a competitor of Makita, in terms of electrical handtools. But they also compete with Sunbeam (Mr. Coffee), KitchenAid, Norelco and Campbell-Hausfield, all in different markets. As a consequence, determining the market share of Black & Decker requires great attention to details, to avoid giving them a different market position than they really hold, by comparing apples and oranges. Analysis of one’s competition is best performed methodically, by a structured template of different competition levels.[ad#ad-4]
There are five principal levels of competition in marketing:
- Consumer need level – A specifically identified need of the consumer.
- Industry – The key industries supplying the demand of those needs, taking into consideration relative growth and market power.
- Product line – Specific products competing with yours in that field.
- Organizational – Companies competing with you in that field, their economic health, market share, and relative growth pattern.
- Brand – The specific brands competing head-on with your product, taking into consideration their market position, corporate prioritization, and your product’s market position.
By identifying your competition in line with these five different levels, you should be able to identify all the competitive factors that present any meaningful resistance, and get a clear image of your market position. After that, by looking at your competitors’ market share, company stability, relative growth and product/service characteristics, you should be able to put together a marketing strategy that will put you on the right track. Bear in mind the fact that any of these five elements can fluctuate, so a strong marketing strategy should also have a good marketing information system in place, to detect variations so that you can make timely adjustments.
Written by: Matt
We also suggest this relevant article if you have time: Blue Ocean Strategy by W. Chan Kim
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Tagged as competition, competitors, market, marketing, marketing competition, marketing strategy + Categorized as Business, Economy articles, Marketing & PR