Week 4

Week 4 of the 11 week class is here or basically gone. It seems like it is flying by. I am going to try and make this blog post quick and sweet as possible as it appears I have fallen victim the summer cold. So I promised I would tell you all about PharmSim explorations. My past week didn’t really let me get to experiment too much, but I definitely plan on going overboard this weekend and next week. I did get some time in PharmSim though. I played around with all sorts of different numbers and I actually increased my stock price. So I am going to take that as I did something right. I really tried to maximize my budget as much as possible, and tried to focus on increasing money to areas that would have more reach such as giving more money towards a Walgreens type store verse a mom and pops drug store.

This week’s reading had no Drucker, much to my despair as it is always easier to talk about that book than other book. I think this is because it has so much more thought provoking concepts in it. We had to ready two chapters out of our “Analysis for Marketing” text book by Donald R. Lehmann and Russell S. Winer. The two chapters were Chapter 2 on Defining the Competitive Set, and Chapter 4 on Competitor Analysis. Something I definitely took away from Chapter 2 is that a company needs to stay open to what could be or become competition. A diet coke doesn’t just compete with another diet cola it competes with other diet sodas, other beverages, ice cream, fast food, and other products that could impact a consumer’s decision to purchase diet coke. However, a company can be overcome with who to consider is competition. So a company must compete with companies that are more direct competitors and similar form competitors. So a diet cola should take into account other diet drinks and beverages in general as well. That is pretty much the rough gist of chapter 2. I will say when thinking about who could be competitors is definitely overwhelming.

Chapter 4 was competitor analysis. Enable for a company to make a good marketing strategy the company should think about what its competitors are doing and how that may impact their marketing strategy. If a competitor is about to launch a similar product maybe the company wants to consider launching their product sooner to obtain the lead on the market. There are four things that a competitor analysis involves. These are:

1)      Assessing competitor objective

2)      Determining competitor’s current strategies

3)      Evaluating competitors capabilities

4)      Forecasting competitor’s future strategy

There lots of sub categories to each one, but the general gist is that these four things have to considered when making one’s own marketing strategy. It would be almost suicidal not too.

However when you read the article “How to Write a Competitor Analysis” by Michael Knowles he actually list five components to a competitor analysis. His five components are:

1)      The company’s competitors

2)      Competitor product summaries

3)      Competitor strengths and weaknesses

4)      The strategies used to by each competitor to achieve their objectives

5)      Market Outlook

This list is very similar to the list provided in the book. The overall theme is to KNOW YOUR COMPETITION! If a company does not know their competition how will they be able to stand out from competition with their product to win over or keep their market share? Your company will not be able to compete unless your company is mindful of this. Now competitors, depending on your business, can be from anywhere on the globe. Competitors can be right next door or they can across the globe. As technology has grown, the reach on companies to consumers has also grown. Now a small local shop could end up competing with a large company from China or England. The internet has really changed how companies compete with eachother. One way to compete, as I sort of already talked about, is that of product differentiation. Differentiation is a huge way companies can compete with their competition on similar products. Part of the reading this week talked about a party store and how they compete with cheaper stores from all over the world. However, they are able to compete because they offer more products on their online store than their in their physical store, and also to offer personalization their party decorations which is something their competition doesn’t do, or do it at a higher price point. They were able to differentiate their product, and eventually succeed. At the end of the day, the message of this week was KNOW your competition  inside and out, and figure out how compete against them by exploiting a weakness. Time to go back to bed, this sick student needs some rest.