Welcome to my “Perform competitor analysis.”
According to media reports, Seven-Eleven was the first to sell a luxury bag with a price of 1,192,000 won at a convenience store. Consumers' reaction to this was very hot, so the volume of ready-to-use products was exhausted for about a year after we started selling. So we would have been a little nervous for department stores and duty-free shops selling Gucci products. But even before this event, did department stores, which deal with luxury goods, imagine that the convenience store chain that sells necessities would be their competitors?
The rivalry between Apple and Samsung, now dominant in the telecom industry, is so well known that even now it is trite. Interestingly only a few years ago, few people expected the two companies to consider each other as their main competitor, even more precisely until Apple launched the iPhone on the market. In addition, telecom companies such as Netflix and AT & T in the US, which are now battling the US video-on-demand market, were once and for all classified as separate industries. In addition, Xerox, which has dominated the copier market, is now shifting its business area to consulting on the use of efficient corporate documents, which, of course, makes many competitors in the IT industry tense. In this ever-changing competitive environment, businesses that appear to have nothing to do with each other until recently are turning into major competitors in a single day.
Typical methods for analyzing the competitive situation of the companies include 3C analysis (Company, Competitor, Customer) and Michael Porter's 5-factor analysis. To date, many companies have focused on identifying industry-wide competitive landscape, mainly using these analytical methods based on industrial economics. On the other hand, the analysis method of Competitive Dynamics, which has been attracting much attention in the recent strategic field, is to analyze the relationship between specific rivals by considering the relative characteristics of each competitor which is easy to overlook in traditional competitor analysis, (Chen, 1996) 1. To be able to predict potential strategic actions of firms. To put it simply, if traditional analytical methods perceive the ever-changing competition between a company and an enterprise as a "snapshot" picture that captures a point in a moving object, the analysis of competitive dynamics reveals their dynamic competition I want to be as aware of it as possible.
The industrial environment is like an ecosystem in which various competitors interact. Even within the so-called "carbonated beverage industry" and "semiconductor industry", each company is competing based on different histories, capabilities, and positioning. Companies with different characteristics take different strategic behaviors with different motivations, looking at the competitive relationship according to their own situation. Therefore, the analysis of competitive dynamics based on the relative relationship among competing firms makes it possible to predict firms' competitive behavior more precisely than traditional competition analysis, which regards the industry as a single analysis unit. As a result, it becomes possible to explain the above-mentioned "companies that did not care until yesterday" to become a competitor overnight and to predict even further. Let's take a closer look at the analysis of Competitive Dynamics, which has attracted the attention of many strategic scholars and entrepreneurs since the mid-1990s.
Competitive relationship analysis
Simply analyzing the characteristics of a competitor or the characteristics of the industry to which it belongs, is not sufficient to analyze the competitive landscape facing the firm. In addition to the absolute characteristics of each competitor, what each company thinks of their situation in the light of other competitors plays an important role in determining the strategic behavior of the firm. In other words, for a more complete competitor analysis, it is necessary to understand the relative relationship between competitors. On the other hand, the analysis of competition in an industry consists of a set of multiple competition relations. This is because the basic unit for analyzing the relative competitive relationship is the competition between the two companies. For example, if there is an industry in which four companies compete with each other, we can derive six pairs of competition (with the names of the companies A, B, C, and D, AB, AC, AD, BC, BD, CD). From now on, we will introduce two concepts of "market commonality" and "resource similarity" which are the most basic in the competition analysis.
1) Market Commonality
'Market commonality' indicates how much a company 's market overlaps with the other' s market. The 'commonality of the market' is a concept that includes both the strategic importance of each market, the competitiveness of the other company, and how the market is competing with each other. 'Market commonality' can be derived by measuring the following two factors. The first is the financial and strategic importance of the market segment. This can be measured simply by the share of each segment in revenue or revenue of the company. The second is the market share of the other companies in each segment. Of course, more complex measurements can be utilized. However, according to previous studies in the field of competitive mechanics, using these two factors can lead to the simplest and most effective 'market commonality' between the two competing firms. Let's take an example of the automotive industry as an example. Ford and GM compete in almost every segment of the automotive market, with both companies having a high "market commonality" in that they are generating the most sales in the US market. In comparison, GM and Toyota Motors have a low 'market commonality'. Because, despite the fact that two companies compete in a number of automotive market segments, much of Toyota's revenues come from Asia and Europe, much of GM's revenues are limited to the US market.
2) Resource Similarity
'Similarity of resources' indicates how much the level and combination of the strategic resources of a company is similar to that of the other company. If two competing firms have similar resource composition, the two firms have similar strategic capabilities and as a result, it is difficult for any firm to compete. At this time, 'resource' does not mean only physical resources. In a broad sense, it encompasses core competencies of the enterprise, such as management capability, efficient production capacity, brand, and technical expertise, as well as areas where the company has outstanding capabilities. Therefore, it may be dangerous to see only their financial or physical resources in determining the "similarity of resources" between two companies. For example, financial capabilities for the US capital markets are no longer a competitive advantage for companies because they can easily access capital. In other words, "similarity of resources" is a combination of competitiveness brought about by "differentiation" among companies. It is important to note that when determining the 'similarity of resources', there is no intervening value judgment that certain combinations of competitiveness are superior or inferior to other combinations. However, 'similarity of resources' only captures how closely the combination of competitiveness of the two companies is structured.
Let's look again at the automotive industry. Both Toyota and Honda have a high level of 'similarity of resources' in terms of design capabilities, product development capabilities, and brand and reputation. On the other hand, BMW and Indian automotive company Tata Motors have a low 'resemblance to resources'.
Asymmetricity of Competition
Competitive asymmetry occurs when two competing firms have different levels of 'market commonality' or 'similarity of resources' to their counterparts. This difference arises because the two companies in the competitive relationship each evaluate their opponents from their own standpoints. For example, let's look at the competition between small company A and large company B. Small Entity A is directly competing with Big Entity B in most of the market, including Core Market. However, a large corporation B is entering a variety of markets in which a small corporation A does not enter, and a large portion of sales of a large corporation B occurs in a market that does not compete with a small corporation A. In Figure 1, the small circle represents the market in which the small company A entered, and the big circle represents the market in which the large company B entered. At this time, small company A has a high 'market commonality' for large company B, while large company B has a low 'market commonality' for small company A. Thus, a small firm A views a large firm B as a direct competitor, while a large firm B does not consider a small firm A a major competitor. If the core business of a large company B is in a market that does not have a small company A, then the large company B only sees the third company competing in that core market as a direct competitor. This kind of asymmetry also occurs in the case of 'similarity of resources'. If a company has most of its resources but its resources overlap with those of its own resources, then the 'similarity of resources' to the other company of that company is the same as that of the other company Will be much higher than the 'similarity of resources'.
Competitive behavior predicted through competition analysis
Once the two competing firms have understood how to look at each other, they are now ready to predict the competitive behavior of the two companies. If the two companies are mutually similar in terms of market and resources and know that their counterparts will respond to any strategic differentiation, they will focus on developing new competitiveness rather than taking aggressive action against them. If, on the other hand, the two firms that are differentiated in terms of market and resources view each other as a potential threat, they will try to prevent their entry into the market by raising the barriers to entry. This is further complicated by the competition asymmetry relationship discussed above. A company feels threats to other companies, but the opponent may not consider the company as important. Competitive dynamics can be applied in various ways ranging from entering and withdrawing to markets, launching new products, developing new competencies, to forecasting mergers and acquisitions. We can better predict the various competitive behaviors among the competing firms and their counterparts according to the analytical framework we use to analyze the competitive relationship. The analysis of competitive dynamics is, as such, a very useful approach to better understand the competition of rival companies.
In the next issue, we will examine the theoretical framework that can be applied when analyzing the rivalry between two rivals to find out how companies can compete with each other, such as market entry, withdrawal, new product launch, new technology development, We will look at ways in which we can more closely anticipate the subsequent actions of a rival company on a particular competitive behavior.
This is an excerpt from "Idea commercialization 100 questions 100 answers".
I am wondering what competition analysis, market research analysis, internal and external environment analysis, marketing strategy are and how to write.
I would like to know practical information about competition analysis, market research analysis, internal and external environment analysis, and marketing strategy among sub-contents of marketing plan among the content of business plan document.
Competitive research, market research analysis, internal and external environment analysis
The keywords in this question are all in the marketing area. So, without understanding marketing,
Because it is somewhat difficult to explain one thing, I would like to briefly explain the basic areas of marketing
I will lock it. Marketing generally has several subdivided business areas, which are closely related to actual industrial sites.
There is. Here, the marketing data of the OECD (Orin Expert Consulting Group © 2014) used in the industrial field
The subcategorization items to be analyzed and investigated are competition analysis, market research analysis, internal and external environment
Analysis, and benchmarking of competitors. Here, competition analysis is mainly a systematic analysis of competitors
It's the easiest way to find and use it.
It is called the 'competition analysis matrix'. Competitive Analysis Matrix
Competitive Analysis with Matrix Composition Matrix tools make it easy to set up a marketing strategy
You can build a base database (DB).
Next is market research. Originally, we need to do prior learning about the subject of 'marketing research methodology'
I will explain the simplest concepts and methods used in the business plan.
First, the first survey method (direct survey method) is to use interviews, questionnaires, and observations on target markets and industries
Although the reliability of the survey method are not very high due to a large number of variables, it also provides the most reliable data.
However, there is a drawback that it takes a lot of time.
Second, the second survey method (literature survey method) is the statistical data that the other person investigated through the first survey method,
It is a method of conducting research based on field analysis. The scope and scope of the survey are broad and relatively clear and rapid.
Although there is an advantage to be able to derive such data,
In the second survey, depending on the preference of the investigator, the same primary survey data may be used as a completely different interpretation
It is necessary to carry out the verification after the second investigation after the first investigation.
Third, intuition. In the case of a new industry or a new technology-based industry,
It is also impossible to investigate it and it is difficult to discriminate even if it is an industrial worker. Because of
this case, methods that rely on foresight or intuition about the direction and flow of the industry are often used. In this case,
It is possible to receive verification from working professionals working in the field.
Then, I will explain how to analyze the internal and external environment.
In a nutshell, the competition analysis matrix described on the previous page is a review of competitors'
To the company. In other words, you can set boundaries between your internal and external environment
is a method and a process to derive a strategy through comparison and comparison after each investigation. Typical methods
3C analysis and SWOT analysis are used. 3C analyzes the environment for customers, competitors, and companies, and SWOT
Analyze internal factors as strengths and weaknesses and external environmental factors as opportunities and threats.
Marketing strategy when writing business plan
Based on the data obtained through market analysis and research,
There is a conceptual difference between 'sales' and 'sales' in order to solve any problems based on survey data.
The marketing strategy is also divided into the tasks of 'Strategic Planning', and the business plan is written
The marketing strategy at the time of 'I will give you a way, a distribution route,
I am asking for a way. In other words, the marketing strategy in a business plan is, strictly speaking,
Strategy 'and marketing' advertising marketing + publicity marketing + digital marketing + distribution marketing '. in reality is correct to present the sales strategy and the marketing strategy separately at the time of presentation, and the tendency is increasing. Is a trend. If sales is a running organization in modern times, marketing is an information strategy department. You can express your character as an important business department that forms the company's brand itself as well as nothing.
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