I. New Products

         CA  –> Differentiation –> Innovation –> New Products

         How New is New?  OH

          Primary Demand

          Selective Demand

II. Review

        Product Life Cycle

        Competitive Position

              Top Dog, Challengers, Underdogs

III.  Market Entry (Timing)

      Pioneer (First-mover) First is Best?

          Advantages:

              1. First choice of Segments and Position-

                       Brand Franchise

              2. Defines the Rules of the Game.

              3. Distribution Advantages

              4. Economies of Scale/Experience Effects

              5. Potentially High Switching Costs

              6. Network Effects

              7. Tying up resources/suppliers.

          Disadvantages:

              1. Cost

              2. Risk

 Follower Strategy

          1. Advantage/learn from Pioneers Mistakes

               A. Positioning/Segmentation

               B. Product Mistakes

               C. Marketing Mistakes

          2. Latest Technology

          3. Pioneer's Limited Resources

          Disadvantages:

 Key Success Factors Ex. 17.3

      Pioneers

           Maintain Leadership (SCA)

           Large Entry Scale

           Broad Product Line

           High Quality

           Heavy Promotion

      Fast Followers

           Out Market the Pioneer (Vision, Resources, Marketing Skills)

           Larger Scale than Pioneer

           Leapfrog with:
                Technology
                Quality
                Service

      Late Entrants

           Focus/Niche

IV.  Strategies for Pioneers

      Mass Market Penetration

           Basic Idea: Growth Total Market/Maintain Leadership

           Conditions:  Favorable for SCA
                              Favorable for Growth
 

           Tactics:

                Increase Awareness and Willingness to Buy

                     Heavy Mass Promotion and Incentives

                Increase Customer's Ability to Buy

                     Penetration Pricing, Extensive Distribution

      Niche Penetration

               Basic Idea: Focus on Attractive Segment(s)

               Conditions: Favor SCA from Focus

               Tactics:

                     Increase Awareness and Willingness to Buy

                          Heavy Focused Promotion

                     Increase Customer's Ability to Buy

                          Selective Distribution
 

 
      Skimming and Withdrawal

           Basic Idea: Max Profit and Get Out

           Conditions: Limited Market, No Opportunity for SCA

           Tactics: Big Margins, Skim the Cream
 
 

V. Growth Market Strategies for Leaders Ex. 17.10

     Share Maintenance

          Fortress or Position Defense

               Basic Idea: Maintain the Status Quo
 
               Conditions: Homogeneous Market, Strong Position,Weaker Competitors

          Flanker Strategy

               Basic Idea: Protect "Flag Ship" with additional products

               Conditions: Heterogeneous Market, Viable Potential Competitors

          Confrontation Strategy

               Basic Idea: Head to Head Competition

               Conditions: Homogeneous Market, Viable Potential Competitors

          Market Expansion Strategy

               Basic Idea: New Product and Segments

               Conditions: Heterogeneous Market, Weaker Competitors
 

          Contraction or strategic withdrawal

               Basic Idea: Focus on attractive segments, abandon weaker segments

               Conditions: Weaker or stronger positions in different segments.
 

VI.  Share-growth for Challengers  Ex. 17.13

          Take Customers from the leader or others

          Capture the largest share of later adopters

      Frontal Attack

           Basic Idea: Beat the leader at his own game.
                             Better Marketing, Cost Advantage

           Conditions: Relatively Homogeneous, Weaker Pioneer
 

      Leapfrog

           Basic Idea: Surpass the leader with a better product

           Conditions: Better Technology, Service, Quality
 

      Flank Attack

           Basic Idea: Divide and Conquer (Segment, Focus)

           Conditions: Heterogeneous Market, Major Segments, Strong Competitors (avoid Head to Head).
 

      Encirclement

           Basic Idea: Meet needs of specialized segments (Many Fronts)

           Conditions: Heterogenous, many segments, strong competitors