A company whose moves arc mainly based on competitors' actions and reactions; it spends most of its time tracking competitors'moves and market shares and trying to find strategies to counter them.
customs r-ct; ntre<I eompuny
A company that focuses on customer developments in designing irs marketing strategies ami on delivering superior value to its target customers.
We have stressed the importance of n company watching its competitors closely, Whether a company is a market leader, challenger, follower or nicher, it must find the competitive marketing strategy that positions it most effectively against its competitors. It must continually adapt its strategies to the fast-changing competitive environment.
This question now arises: Can the company spend too much time and energy tracking competitors, damaging its customer orientation? The answer is yes! A company can become so competitor-centred that it loses its even more important customer focus. A competitor-centred company is one whose moves are based mainly on competitors' actions and reactions. The company spends most of its time tracking competitors' moves and market shares, and trying to find strategies to counter them.
This mode of strategy planning has .some pluses and minuses. On the positive side, the company develops a fighter orientation. It trains its marketers to be on constant alert, watching for weaknesses in their position and watching for competitors' weaknesses. On the negative side, the company becomes too reactive. Rather than carrying out its own consistent customer-oriented strategy, it bases its moves on competitors' moves. As a result, it does not move in a planned direction towards a goal. It does not know where it will end up, since so much depends on what the competitors do.
A cushmier-ecntred company, in contrast, focuses more on customer developments in designing its strategies. Clearly, die customer-centred company is in a better position to identify new opportunities and set a strategy that makes longrun sense. By watching customer needs evolve, it can decide what customer groups and what emerging needs are the most important to serve, given its resources and objectives.
Evolving Company orientations
In practice, today's companies must be market-centred companies, watching both their customers and their competitors. They must not let competitor watching blind them to customer focusing. Figure 12.7 shows that companies have moved through four orientations over the years. In the first stage, they were product-oriented, paying little attention to either customers or competitors. In the second stage, they became customer-oriented and started to pay attention to customers. In the third stage, when they started to pay attention to competitors, they became competitor-oriented. Today, companies need to be market-oriented, paying balanced attention to both customer and competitors. A market orientation pays big dividends - one recent study found a substantial positive relationship between a company's marketing orientation and its profitability, a relationship that held regardless of type of business or market environment.-12
A company that pays balanced attention to boih customers and competitors in designing its nu.irkei.ing strategies.
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