It is ironical, defensive marketing is done only by the fittest

What we learn in schools is that only the weakest have to be defensive all the way. But in business it is the other way about. The fittest have to resort to defensive marketing as business strategy to forestall competitor advances.

The challenge arises when a market leader is alarmed about a new or existing competitor bringing out a superior product with lower price, better quality and advanced features that have the potential to appeal to its own customers. At this point the score is getting equal and the tendency for the challenger to scoop market share is now real.

Failure to respond to this newest offensive could result in two ways: one the major chunk of customers might walk across the road to the attacking firm and start using the new product. Second and most debilitative one is the expected bad press that can play havoc in terms of company reputation and fall of its share price in the stock market reducing its capitalization value.

In order to stem the tide of competition firm must ensure two things: one is to do everything possible to protect the existing customer base. Second is to explore new customers joining its base. Singular objective is the denial of new product making inroads into firm’s customer base or building product acceptance outside.

To operationalize these objectives firm need to look at three main areas: product positioning, psycho campaign and customer loyalty improvement. Product poisoning is the key to fight any new innovation in the market. Google did this in a unique manner. Faced with new competitors in the horizon it used high tech to make product upgrade in search market by introducing “cloud technology”. This served twin purposes: one it forestalled competitor gaining foothold and secondly it raised the competition to higher level where the new entrants have to toil more.

Social engineering via psychological warfare is the second type of defensive mechanism. This conveys to the market that firms’ product is superior and the one by the challenger is inferior. Moreover, enhancing brand loyalty is carried out by undertaking promotional drive and targeted advertisements.

Loyalty plus is the third method which is much easier to implement with good results. Here the aim is retaining customer loyalty to the firm as a whole and encourage new customers to join the band wagon. Several inducements are given for this purpose. Gift vouchers, price coupons and “Buy 1 & get 1 free” are some of the popular tactics. Most companies in retail trade such as Wall Mart do this exceptionally well.

 

Cheers!

 

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail:   cosmicgems@gmail.com

Blog:   Business Strategist