Competitive Analysis & Positioning Paper
Assignment #2: A. Competitive Analysis and Positioning
Competition is one of the most important aspects of the marketing landscape. The more choices a customer has, the more difficult it is for any one business to attract a sizeable number. In order to stand out from the competition, it is crucial for a business to occupy a distinct position in customers’ minds by offering compelling advantages for choosing your services. The purpose of this assignment is understand the level and type of competition facing the business and clarify how the business can be positioned as the best choice versus competitors in the eyes of your target customers.
- Assess the level of competition: Looking at the industry sector, how competitive is it (high, medium or low)? Are there many new entrants to your market vying for similar customers, and if so, what type of businesses are entering the market? Are businesses leaving the market, and if so, which types? Are there disruptive innovators shaking up your market, and if so, what do they offer that will impact the ability of your business to compete for customers?
- Identify the Overall Positioning Strategy: Identify your business’s current position in the marketplace, based on one of the following “generic” choices:
- market leader: typically drives the market forward with highest perceived value and innovation.
- market challenger: competing with similar products on the basis of price, quality, service level, or innovation
- niche strategy: focusing on small, unique markets, local geographic areas, limited channels of distribution, high-end service or filling a premium or luxury position.
- Analyze direct and indirect competitors: Review the different levels of competition (Form, Category, and Close Substitutes) and list up to 10 direct and indirect competitors (including future threats, if relevant). List their names and describe basic features, such as level and type of services, operating statistics (#rooms/#seats/#flavors), price points (ADRs, Avg check, retail prices, etc.), and primary customer base. Create a chart to display your findings.
- Identify a Competitive Advantage: Choose 4 – 5 of your direct competitors as your “competitive set,” that is the businesses who target customers primarily think of when seeking similar services. Assess these businesses to pinpoint Points of Parity (PP – things that are similar across businesses in your category) and identify Points of Difference (DP – things that differentiate your business from the competitors in a meaningful way?) Which of these points of difference could be a competitive advantage that you can exploit to gain market share? Which of these points of difference could become a competitive disadvantage, and how might you close that gap so that you don’t lose customers to your competitors?
Marketing Strategies (3 of the 4 Ps)
This assignment deals with the “4 Ps” of marketing: Product, Price, Place and Promotion. The four Ps reference the primary ways that a business can modify its offerings and delivery methods to satisfy a target market and claim a competitive advantage. Businesses in the hospitality and tourism industry are constantly updating their strategies to meet the changing wants and needs of customers and to find new ways to compete. The goal of this assignment is for you to create a product strategy to enable your business to better compete for your target markets.
Your assignment is to recommend 3 changes or enhancements to the hospitality or tourism business’s product, price or place. You should state how these enhancements will provide some form of additional benefit to the target markets you selected. Your options could include:
- Product Strategies
- Market Penetration: Increase the buying rate of current customers through price, place or promotional strategies (be specific which ones)
- Product Development: Make improvement or add new features or experiences to existing services to appeal to unmet (changing) customer wants and needs.
- Market Development: Promote existing offerings to previously untapped target markets or geographic areas.
- Diversification: Develop innovative new offerings to appeal to existing or new audiences.
Price Strategies
- Reduce Costs/Increase Benefits Relative to Competition by:
- Lowering overall financial outlay (e.g., reducing prices, offering packages, eliminating hidden costs)
- Making services easier to access
- Reducing the time involved for purchase or use
- Increasing comfort or safety in the transaction
- Reducing financial and psychological risk
Place Strategies
- Decrease inconvenience/Increase convenience relative to the competition by
- Reducing barriers to purchase or use
- Bringing offerings closer geographically
- Enhancing online and virtual offerings
- Promotional Mix:
This assignment addresses another “P” of Marketing – Promotion. The promotional mix refers to the various communication media a business uses to reach target markets. Increasingly, hospitality and tourism businesses reach consumers through the internet – through online “channel partners” as well as through their own electronic communication media. However, they also use some traditional media such as travel agents, print and broadcast media, direct mail and personal selling to engage consumers.
This assignment asks you to develop a 6-month promotional campaign for reaching your target markets through the following promotional media:
- channel partners such as the online travel agencies and tourism apps
- electronic media: the business’ own website, social media outlets and email marketing.
- traditional media of communication (print and broadcast advertising, public relations, direct mail, personal selling)
List each target market identified and the relevant marketing objective. Then select at least 1 promotional media in each of the 3 categories (channel partners, electronic media or traditional media) for each target market. Then state the timing and frequency with which you will employ each promotional media. Add extra rows to the chart as needed.