An important element in strategy development is attempting to anticipate how a c

Question

An important element in strategy development is attempting to anticipate how a competitor might respond to your changes in strategy(ies). Select a company and a product you use/ are familiar with that has a similar competing item made by another company (Under Armour versus Nike, Campbell versus Progresso, Allstate versus State Farm).   What might these two companies use as strategies to get you to buy their product? Use concepts from the reading and additional source(s) beyond the reading for support. Consider the long-term consequence of the strategy(ies) you describe for-profit and company growth.

Explanation / Answer

Answer: The strategy depends on how deep pockets the companies have or the inherent strengths like product innovation, distribution channel,brand percepton and recall.

-Product repositioning to enhance the brand perception and enable value based pricing

-Penetration pricing: If you have deep pockets and product differentiation is limited then lower the price of the product to capture market share and kill the competition. Proft from increased volume. Price should not be below the cost structure.

-Introduce referral schemes with discounts

- Use bundling strategy

-Use cross selling and upselling

-Use cost focus strategy ie offer lowest prices in specfic markets

-Use product differentiation to offer fit for purpose products with high WTP(willingness to Pay)

-For new and emerging products influence customer habits, build desire for the product and create new market by product positionig . For mature products focus on establishing brand superiority,improve customer service

-Use promotional best prices or seasonal offers

-Leverage digital media and e commerce platform to add convenience to customer shopping experience

-Introduce vendor managed inventory model , keep the competitor products off the retailer's shelves, enhance instore customer experience

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