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Competitors analysis and interfirm rivalry, G2 (IBS 3 Cathy, DFLL 4 Evelyn…
Competitors analysis and interfirm rivalry
Competitors analysis
Purpose
To understand and predict the rivalry
Many different tools
Strategic-group approach
To
examine the competitive environment
and the
rivalry among competitors within an industry
Overlooked the
market context
and the
extent of direct competition between two firms
The most popular and relevant method now
Porter’s five forces
A theoretical construct
Some rely on managers' or researchers' subjective perceptions
To know how to explain others' market behavior
Distinguish who are competitors
Competitive Action and Response
Attack
A series of actions and response
AMC
Capability
Strategic or resource endowments
Awareness
Market relationship
Motivation
Introduce a new product or enter a new market
First-mover advantage
The result most depends on defenders' responses
Decide attack/response or not
Evaluate the relationship with competitors
Is it possible to retaliate?
Some may not pose an equal threat to each other
Compare the defender's overall market and resource profiles
Each market is unique
Market commonality
Multimarket contact
Determines two firms are direct and immediate competitors or not
The intensity of competition
Strategic importance to the focal firm of the shared markets
Resource similarity
The extent to which a given competitor possesses strategic endowments comparable
Competitive advantage
Strategies
Top-down approach⬇️
Strategic capabilities and resource transferabilities
Bottom-up approach⬆️
Customer market requirements
Notice the
links between games
It's a firm-specific analysis
Different resources and asset
The relationships between firms are not symmetrical
Competitive tension
Offer similar products or services
May be consider as a primary competitor
Competitive tension between firms
The potential of these two firms for engaging in competition
Conciusion
Competitive analysis :memo:
Series of
actions & responses
to the competitors' behaviors :crossed_swords:
To understand
the competitors' acts
in the game :silhouette:
Predict the rivary :bulb:
Partnership :silhouettes:
Complementors
Competitiors
Rivals' rivals
Questions of the firms:question:
How
to find competitors
Analyze your situation& use different strategies
What
to do after finding the competitors
Illustration
Market commonality
Measure
Resource similarity
Market commonality mapping
Trans World Airlines - TW
v.s.
American Airlines - AA
America West Airlines - HP(454)
v.s.
Southwest Airlines - WN (308)
The quantity of shared markets might not entirely represent the intensity of market competition.
AA (415) v.s. HP (454)
Competitors mapping
Competitive asymmetry
Analyzing competitors from multiple vantage points
Propositions
Market Commonality
&
Interfirm Rivalry
All else being equal
Greater market commonality
Less likely to attack
Proposition 1a
More likely to respond
Proposition 1b
Resource Similarity
&
Interfirm Rivalry
All else being equal
Greater resource similarity
Less likely to attack
Proposition 2a
More likely to respond
Proposition 2b
Market Commonality
VS
Resource Similarity
To Predictor of competitive attack and response
Market Commonality is Better
Proposition 3
I know what you do and what you want and you know what I will do either
Competitive Asymmetry
&
Interfirm Rivalry
Competitive Asymmetry
Exist within any pair of competitors
Proposition 4a
Impossilbe to have same market commonality and of resource similarity
The % of one to
attack / respond
another is not the same
Proposition 4b
The likelihood that A will attack B will differ from the likelihood that B will attack A
The likelihood that A will respond B will differ from the likelihood that B will respond A
G2
IBS 3 Cathy
DFLL 4 Evelyn
IBS M2 Brianna
SDEI M2 Antony
Competitive is dynamic and interactive nature