ABSTRACT
This chapter develops the previously made assertion that there is a need to take account of competition when formulating marketing strategy. Competition is influenced by the nature of the industry in which the firms compete. Such industries are collections of organizations with common products and technologies and have life cycles. As industries progress through their life cycle of growth, maturity and decline, the nature of the industries, their makeup and their competitive nature change.
Defining and identifying competition is not always simple. The most obvious competitors are those which offer identical products or services to the same customers. However, substitute products and services highlight the nature of indirect competition, which must also be taken into account. The chapter examines the factors that influence competition and in particular the ideas suggested by Michael Porter. We also describe different competitive strategy typologies – leader, challenger, follower and market niching. Finally, we consider what to look for when trying to understand and assess the strategies of competitors.
