Marketing Strategy and Competitive Positioning pdf ebook

revolution – in the ways industries and markets operate and the sources of competition 
that become important, and consequently in the strategies that successful organisations 
pursue;
● 
reinvention – in the creation of new business models that make traditional ways of doing 
business obsolete as routes to delivering and sustaining superior customer value; and,
● 
renewal – in the strategies of change and repositioning by companies whose business 
models have become outdated, as they rebuild and respond to change. Increasingly, the 
priority is not just short-term performance but building the robustness to bounce back, 
to change, to survive, to turn things around (Cravens et al., 1998).
In using the structure in Figure 12.2 to analyse a company situation, we accept that 
the changes in the market amount to a revolution. It is inevitable that radical market and 
customer change provides disruptive pressures for the established players in the market. 
The challenge for them is to understand the specific changes unfolding and where they are 
going, and to respond with coping and adaptation mechanisms – renewal. The same market 
changes identify the new opportunities to create superior value for customers by designing 
new business models – that is, to develop new ways of doing business that are aligned with 
market change – reinvention. Tracking the specifics of fundamental market changes and 

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CHAPTER 12 COMPETING THROUGH INNOVATION
the disruptions created is the basis for developing effective responses and evolving new 
business models.
One interesting question when using this approach is whether the existing competitors in 
a market are capable of reinvention, or whether emerging value-creating opportunities will 
instead be exploited by new entrants to the market. It is quite possible that the new entrant, 
unencumbered by existing ways of doing things, will take the strongest position. When the 
laptop computer market became obsessed with the size and weight of the machines, the first 
sub-three-pound laptop did not come from Dell, IBM or Hewlett-Packard – it came from 
Sony. Sony had no real track record or capabilities in the computer business, but is just 
very good at making things smaller. In the move to develop electric and hydrogen-powered 
vehicles as an alternative to high-pollution petrol fuels, it is small start-ups, notably in Sili-
con Valley, that are driving innovation, not the big car makers who have been reluctant to 
invest and slow to respond (Reed, 2008). While today almost all car makers have electric 
vehicles on the road, and are committed to developing them, it is Tesla that led the way in 
making the electric car a desirable reality for customers.
Increasingly, it looks like success goes to the company that can invent a whole new cat-
egory of products: brewing coffee at home from expensive pods in expensive coffee makers 
has taken the market away from traditional but cheaper ways of making coffee; Microsoft’s 
Xbox live gaming system combines a traditional video game with a subscription-based 
online service; the creation of Spanx has revolutionised the underwear business by the crea-
tive use of a new fabric type. Companies that create new categories show high performance 
compared to their competitors.
12.1.3 The innovative company
Increasingly, and in most industrial sectors, one key survival factor is the ability to build 
creative, innovative companies. A new corporate model is taking shape in successful 
organisations, that focuses on creativity and innovation to provide new pathways to