1. CHAPTER 4: Defining the competitive set
PRODUCT MANAGEMENT
CHAPTER 4: Defining the competitive set

2. LEARNING OBJECTIVES:
After studying this chapter, you should be able to:
Understand what is a competitive set
Identify the levels of market competition
Understand the methods of determining competitors

3. CHAPTER OUTLINE Overview of the competitive set
Levels of market competition
Methods of determining competitors

4. Bases of Competition Customer-oriented
Who they are – competition for same budget
When they use it
Why they use it- benefits sought
Marketing-oriented: advertising and promotion
Theme/copy strategy
Media
Distribution
Price

5. Bases of Competition cont.
Resource-oriented
Raw materials
Employees
Financial resources
Geographic

6. Levels of Competitions
Def : The proximity of other products to the physical attributes of the product in question
In terms of product form, product category, generic competition and budget competition

7. Levels of Competition Diet lemon limes Baseball cards Coffee Coke
Fruit flavored colas
Coffee
Coke
Pepsi
Diet-Rite
cola
Bottled
water
Lemon
Regular
colas
Beers
Juices
Wine
Fast food
Tea
Video
rentals
Ice
cream
Product form competition: Diet colas
Product category competition: Soft drinks
Generic competition: Beverages
Budget competition: Food and entertainment

8. Levels of Competition: Implications for Product Strategy
Competitive Level
Product Management Task
Product Form
Convince Customers that the Brand is Better than Others
Convince Customers that the Product Form is Best in the Category
Product Category
Generic
Convince Customers that the Product Category is the Best Way to Satisfy Needs
Budget
Convince Customers that the Generic Benefits are the Most Appropriate Way to Spend their Money

9. Methods For Determining Competitors
Managerial judgment
Customer-based Measures

10. Managerial Judgment Experience Salesperson call reports Distributors
Other company sources

11. Managerial judgment
Markets Product/Services
Same
Different A B C D

12. Customer-Based Measures
Behavioral data
Customer Judgements

13. Behavioral Data
Time t + 1
Time t A B C D E .6 .2 .3 .4 .1 .5

14. Customer Judgments Judged overall similarity
Similarity within consideration
Product deletion
Substitution in use