Marketing Strategy and Competitive Positioning pdf ebook

Figure 18.1
Pressures on 
marketing
Increasingly
demanding
customers
Uncertain
business
environment
Increasing
competition
Organisational
change

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CHAPTER 18 MARKETING IN THE TWENTY-FIRST CENTURY
New strategic thinking has to consider that customers are more sophisticated and more 
marketing-literate than ever before. Price comparison sites, such as Gocompare.com and 
Confused.com, allow customers to compare not only product features, but also retail prices 
of the same product in different outlets. There are now also comparison websites that 
compare the information available on comparison websites, and comparison websites for 
business-to-business markets. Phone apps also contribute to this issue, allowing customers 
to scan barcodes while in store, and to see instantly whether the same product is cheaper 
elsewhere, online or locally. Other similar apps abound, and all offer customers more infor-
mation regarding ‘the market’ for particular products or services than ever before. As a 
result, customers are now less likely to buy (or continue to buy) cheap products of low 
quality. Equally, they are unlikely to be won by image-based advertising alone. The impli-
cation is clear: differentiation needs to be based on clearly demonstrating superior value to 
customers (see Figure 18.2). To do this effectively, companies must be aware of the value 
they create in any given market and the ways in which customer perceptions of value might 
be affected or change. As a result, a deep knowledge of ‘the market’ and its customers is 
essential, and an ongoing ability to derive accurate and useful insights from customer and 
market data is of central importance.
A third major trend is in both the level and nature of competition. Competition is 
becoming more intense and more global in nature. Firms generally (recent geo-political 
‘issues’ aside) face tougher international competition at home and increased opportuni-
ties abroad. Time and distance are shrinking rapidly as communications become near 
instantaneous. Firms are increasingly thinking global in their strategies, especially as 
cross-national segments are beginning to emerge for products and services, from fast 
foods through toys to computers and automobiles. The increasingly widespread use of the 
Internet for promoting and marketing products and services now means that communi-
cations are largely unaffected by national boundaries, other than those operating within 
strict political guidelines. Not only are markets becoming more competitive through more 
players emerging in them, those firms that survive and thrive in these more competitive 
conditions are, by their very nature, tougher competitors. Weak firms are being shaken 
out of markets where they do not have clear positions and attendant capabilities. The 
implication of heightened, more aggressive competition, both domestic and international, 
is that firms will need to look even more closely at their scope of operations and targeting 
in the future.
And yet, the executive must confront the central paradox in all this. As markets become 
harsher in their judgements, and in the level of competitiveness faced, companies are 
under growing pressure to collaborate with and partner others. Increasingly, collabora-
tion is taking place, with suppliers, customers and even competitors. The clear demar-
cation lines of the past are blurring, and executives have to deal with more ambiguous 
new roles. As we have seen, the demands of customers for firms (and their suppliers) to 
demonstrate ethical credentials and to undertake social and environmentally responsible 
initiatives, have emerged at a time where those same customers demand lower prices and 
higher quality. Not least among the many problems facing executives is that of achieving 
economic efficiency and long-term viability, while also being able to demonstrate clearly 
to various stakeholders that they are helping to tackle broader social and environmental 
challenges.