Expanding the Total Demand

The leading firm normally gains the most when the total market expands. If Americans, for example, eat more fast food, McDonald's stands to gain the most because it holds more than three times the fast-food market share of nearest competitor Burger King. If McDonald's can convince more Americans that fast food is the best eating-out choice in these economic times, it will benefit more than its competitors.

Market leaders can expand the market by developing new users, new uses, and more usage of its products. They usually can find new users or untapped market segments in many places. For example, NutriSystem has typically targeted its weight loss programs toward women. Recently, however, it stepped up its efforts to attract male customers.13

Prior to 2006, NutriSystem featured only a few men in its customer testimonials. However, it now directly targets men with its NutriSystem Advanced Men's Program. The weight-management company advertises regularly in male-skewing media such as ESPN TV and radio, Sports Illustrated, and Men's Health [magazines], NutriSystem spends nearly one-third of its television advertising budget on male-oriented networks. The men's program offers pretty much the same types of meals offered to women. Ads feature sports legends such as [American football star] Dan Marino (who lost 22 pounds on the NutriSystem program) and [American football coach] Don Schula (who lost 32 pounds). They focus on what men want most: not having to think about losing weight, no group meetings, and prepackaged "man foods." In one commercial, Marino proclaims, "With NutriSystem, I got to eat the foods I grew up with back in Pittsburgh—burgers, hot dogs, lasagna, pancakes, pot roast, meatballs—foods that guys love to eat----Thanks to NutriSystem, I ate like a man and still lost weight."

The result? Since hiring the spokesmen and adding men's chat rooms to its Web site, the male share of NutriSystem customers rose from 13 percent to 30, fueling substantial growth. Company sales increased 37 percent last year.

Marketers can expand markets by discovering and promoting new uses for the product. For example, Arm & Hammer baking soda, whose sales had flattened after 125 years, discovered that consumers were using baking soda as a refrigerator deodorizer. It launched a heavy advertising and publicity campaign focusing on this use and persuaded consumers to place an open box of baking soda in their refrigerators and to replace it every few months. Today, its Web site (www.armandhammer.com) features new uses—"Solutions for my home, my family, my body"—ranging from removing residue left behind by hairstyling products and sweetening garbage disposals, laundry hampers, refrigerators, and trash cans to creating a home spa in your bathroom.

Finally, market leaders can encourage more usage by convincing people to use the product more often or to use more per occasion. A For example, Campbell urges people to eat soup and other Campbell's products more often by running ads containing new recipes. It also offers a toll-free hotline (1-888-MM-MM-GOOD), staffed by live "recipe representatives" who offer recipes to lastminute cooks at a loss for meal ideas. And the Campbell's Kitchen section of the company's Web site (www.campbellsoup.com) lets visitors search for or exchange recipes, set up their own personal recipe box, sign up for a daily or weekly Meal Mail program, and even watch online video clips of guest chefs cooking any of 27 recipes on Campbell's Kitchen TV.

Kitchen

Welcome ; Campbell's Kitchen . Hfrtntion & Wellness ; Labels tor Education j Our Company | Visit our Product Websites ▼

Campbell's Kitchen T.V.

Thiiny fsis

.ii-r £ >~rs&its Delicious Desserts Easy: Skillet Dishes Campbell's Kitchen T.V. Campbell's Kitchen g»ssic 5

Sort my recipes by;

rD^sl^j-co&ks to tenderness f^flin dishes uiaera ten» gtee of apricot jmm Mtf. urn and Coc*: B hrs Swanscr® Chicken Brett;.

This delicious stir-fry combine» sfttokt !We'n di8he* steak and trash vegetables gently betted J« an essptette, Asian-Inspired sauce featuring Campbell's® Condensed Beef Broth.

Port & fipgtes

Savory pert chops simmer in the stow CGOter with tert Granny Smith apples made with CawpBeite® CswieriBed rD^sl^j-co&ks to tenderness f^flin dishes uiaera ten» gtee of apricot jmm Mtf. urn and Coc*: B hrs Swanscr® Chicken Brett;.

Prep/Cook: 25 mil

This delicious stir-fry combine» sfttokt !We'n di8he* steak and trash vegetables gently betted J« an essptette, Asian-Inspired sauce featuring Campbell's® Condensed Beef Broth.

Port & fipgtes

Savory pert chops simmer in the stow CGOter with tert Granny Smith apples made with CawpBeite® CswieriBed

Creating more usage: Campbell urges people to eat its soups and other products more often by running ads containing new recipes. It even offers online video clips of guest chefs cooking any of 27 recipes on Campbell's Kitchen TV.

Chapter 18 I Creating Competitive Advantage 565 Protecting Market Share

While trying to expand total market size, the leading firm also must protect its current business against competitors' attacks. Wal-Mart must also constantly guard against Carrefour; Caterpillar against Komatsu; and McDonald's against Burger King.

What can the market leader do to protect its position? First, it must prevent or fix weaknesses that provide opportunities for competitors. It must always fulfill its value promise. Its prices must remain consistent with the value that customers see in the brand. It must work tirelessly to keep strong relationships with valued customers. The leader should "plug holes" so that competitors do not jump in.

But the best defense is a good offense, and the best response is continuous innovation. The leader refuses to be content with the way things are and leads the industry in new products, customer services, distribution effectiveness, promotion, and cost cutting. It keeps increasing its competitive effectiveness and value to customers. And when attacked by challengers, the market leader reacts decisively. A For example, in the laundry products category, market leader P&G has been relentless in its offense against challengers such as Unilever.

In one of the most fabled marketing battles of the past century, P&G won the laundry war because it was bigger, better, more focused, and more aggressive than challenger Unilever. Last year alone, P&G outgunned Unilever on U.S. media spending for laundry brands by $218 million to $25 million. Entering this millennium, even though its U.S. laundry detergent market share was well over 50 percent, P&G kept raining blows on Unilever and all other comers with stepped-up product launches. Such products as Tide with Downey, Tide Coldwater, and the scent-focused Simple Pleasures lineup for Tide and Downey helped P&G steadily gain a share point or two per year in recent years, so that it now owns a 62.5 percent share of the $3.6 billion laundry-detergent market to Unilever's 12.9 percent (including Unilever's All and Wisk brands). It has an even bigger lead in fabric softeners—66 percent to Unilever's 8.4 percent (Unilever's Snuggle brand). Globally, P&G has gone from being the number-two laundry player in the early 1990s to dominant market leader today, with a global market share of 34 percent to Unilever's 17 percent. In the face of P&G's relentless assault, Unilever finally threw in the towel and recently put its U.S. detergents business up for sale.14

Tube Traffic Ninja

Tube Traffic Ninja

Discover How You Can Quickly And Easily Dominate Google and YouTube... With Simple Cash Generating Videos. Did you know that YouTube is the second largest search website on the entire Internet? YouTube gets more daily searches than Bing and Yahoo. In fact, there is only one search engine that gets more action.

Get My Free Ebook


Responses

  • miia
    How company expand total market demand?
    3 years ago
  • lia
    What is expanding the total market?
    3 years ago
  • michelle gibson
    How can the market leader expand the total demand?
    2 years ago
  • ubalda
    How to expand tottal market demand?
    2 years ago
  • marko
    When the total market expands, the market ________ usually gains the most.?
    11 months ago
  • briffo lightfoot
    How does companies expand total market demand.?
    2 months ago

Post a comment