市场营销(双语)Chapter 7 Marketing Competitive Strategies.pptVIP

Chapter 7Marketing Competitive Strategies 7.1 Five Basic Competitive Forces 7.1.1 Threat of New Entrants New entrants bring more competition to an industry. They might provide new approaches to satisfy customers’ needs and wrest market share from the market leader or other companies in the industry. The emergence of new entrants always leads to price cutting and reduced industry profitability. According to Porter’s theory, there are six major barriers to entry, the presence or absence of which determines the extent of threat of new industry entrants. 1. Economies of Scale Economies of scale refer to the decline in per-unit product costs as the absolute volume of production per period increases. existing firms are able to set lower prices or obtain higher profitability than new entrants. 2. Product Differentiation Unique product attributes, excellent customer services or effective marketing communications can provide differentiated product or service image in the eyes of consumers which results in brand loyalty. Product differentiation and brand loyalty raise the barrier for new entrants who are required to make substantial investment in RD or advertising. 3. Switching Costs Switching costs are caused by the need to change suppliers and products. These might include the cost of searching for or assessing a new supplier, retraining and so on. High switching costs may form an insurmountable obstacle to prevent new entrants from gaining target customers and market share. 4. Capital Requirement The enormous capital requirements in an industry prevent firms with limited resources from entering or achieving success. Capital is not only required for manufacturing equipments, but also for assisting RD, promotion, advertising, sales, after-sales service, distribution channel exploring and inventories. 5. Government Policies Nearly in every country, the government will restrict competitor entering in some industries. Thus, it is hard or impossible to enter some indus