This is for my Marketing management class. Thank you so much in advance! How to

Question

This is for my Marketing management class.

Thank you so much in advance!

How to Attack a Category Leader?

Attacking a category leader is always difficult. Some strategists recommend attacking a leader “head-on” by targeting its strengths. Other strategists disagree and recommend flanking and attempting to avoid the leader’s strengths.

Your assignment is to pick a category leader and follower in any industry and decide on one of two ways to challenge them.

1)      Attack the leader head on.

Examples-a) Subway had a campaign that attacked McDonalds.

                b) MAC attacks PC (Microsoft) head on.

2)      Use a flanking strategy and avoid a head on assault

Example- a) Athletic shoe companies usually avoid head on attacks.

                b) Many service industries avoid head on attacks.           

You will select a market leader and a follower, (Do Not Use My Examples- Toyota / Kia,, McDonalds /Subway,,,PC/ Mac) then select only one of the two approaches above. You will describe how you as CMO of the follower will challenge the market leader. State your strategy; explain your reasoning and why the approach you selected is stronger then other.

(3 pages of type)

When considering a Strategy,,,,,

What are some of the strengths of a market leader? A market leader as defined here, generally, has the largest market share in the relevant product, market, usually leads the other firms in price changes, new-product introductions, distribution coverage, and promotional intensity. Trying to attack the leader on its strengths requires point-of-differences in brands, sophisticated marketing positioning, and “deep pockets” for the challenger.

The underling strategy for performing a head on attack to a market leader is: If the attacking firm sees that the market leader is not serving the market well; that the attacker has out-innovated the market leader through product innovations or other differentials; or if the market leader is conservatively spending or is “milking” the market.

A flanker attack can be directed along two strategic directions—geographic and segmental. In a geographic attack, the challenger spots areas where the opponent is underperforming. In segmental, the challenger uncovers underserved market needs and attempts to penetrate these markets with its products. Flanking is in the best tradition of modern marketing that holds that the purpose of marketing is to discover needs and satisfy them. Flanking is particularly attractive to challengers with fewer resources.

Explanation / Answer

To draft a Marketing strategy, I have selected two companies in the shoe business:

ADIDAS & SKECHERS

ADIDAS is the Market Leader
SKECHERS is the Follower

Lets see a brief description on both these company:

ADIDAS :

Founded in 1949 a prioneer in the shoe industry. The inventor of light leather soccer boots with screw-in studs. The boots helped Germany beat Hungary in the ’54 World Cup final and made Adidas internationally recognized as the leader in soccer.

SKECHERS :

Skechers USA Inc. is an American lifestyle and performance footwear company . Headquartered in Manhattan Beach, California, the brand was founded in 1992.

Marketing strategy Approach: Flanking Strategy

Before we start to make a concrete marketing strategy, as a CMO of Skechers is it very important to understand where the on whole the company stands.

As detailed self SWOT summary can help in the better understanding:

1. Strength
a. Increase in sales every year.
b. Strong base within United States.
c. Gained market share in the last few quaters.

2. Weakness
a. Not much international presence, less penetration in the global market (especially in Asia where there is a huge market).
b. No major celebrity endorsing the brand.

3.Opportunity
a. International Marketing.
b. Increase outlets outside US.

4. Threats
a. Adidas and other companys strong international presence.
b. Geographical problems, starting internation business from scratch.

Marketing Strategy:

As the CMO I feel the a GLOBAL PENETRATION is much needed for Skechers. Skechers has grown over the years at home with the stocks going up by 150%. The revenue of $3.6 Billion in revenue in US alone.

A detailed marketing strategy has to be darfted for a worldwide presence.

1. Tragetting geologically:

ASIA: This is one of the leading market for shoe business, with more than 50% of the population as less than 30 years old.

ASIA has the two of the most populated countires in the world CHINA & INDIA.
Both these countries are not only a potential market but also can take the brand to places.
Lets take the example of INDIA,
> India's polutation is mostly young and atheletic.
> ADIDAS has completely penetrated in the market.
> Leading Celebrities have endrosed this brand.
> Understand the need of new competitor in this market.
> Thought ADIDAS is popular its high cost is not welcomed by the middle class.

FLANKING MARKETING:

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