Competing aggressively and repeatedly on price can threaten the future of companies. The losers of price wars have been known to go out of business, and the survivors to suffer a long-term squeeze on profitability. Generally, the winners are companies that have a superior cost structure. It is, however, possible for a ‘weaker’ company to […]
Subject: Competitive strategy
How Competition for Customers Causes Unethical Behaviour
Competition has traditionally received much praise, particularly from economists who point to its contributions in lowering market prices and also improving the quality of goods and services. However, recent research from schools including Marshall School of Business and UCLA Anderson School of Management has shown that intense competition can in fact naturally lead to unethical […]
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Creating Shared Value Using Inter-Organizational Networks
Creating positive societal and environmental impact whilst retaining competitiveness has become an increasingly popular concept for companies in recent years—also known as ‘creating shared value.’ A term first coined by Harvard Business School’s Michael E. Porter and Mark R. Kramer in 2011, creating shared value refers to policies and practices that enhance the competiveness of […]
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Profits Vs Principles: Market Competition and Moral Transgression
Why do unethical practices become ‘normalized’ in some organizations? Why do errant employees sometimes go unpunished for long periods of time? These are questions that many people will have asked in the wake of the phone hacking scandal at News of the World and the recent interest-rate-rigging scandals at major banks. One explanation is that […]
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Why Inferior Innovations Often Beat the Best
New products and technologies often fail to depose inferior ‘incumbents’. (The classic example is the Dvorak keyboard, which, despite being more efficient, lost out to the original QWERTY model in the 1930s.) New products and technologies of equal strengths often go on to win unequal shares of the market. The dynamics of competition are complex. […]
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Co-creating with Customers: More Pros than Cons?
Co-creation in the business-to-consumer (B2C) environment is nothing new. Many services — ranging from hairdressing to care for the elderly through architecture and interior design — have long involved close collaboration with customers and clients and long been ‘marketed’ partly through word of mouth. It has, however, been given new impetus — and a higher […]
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Eureka! How to Get that Great Idea to Market
It is often assumed that customers are the best judges of whether or not they have a problem, but that is not always the case, especially when it comes to innovative complex products. As with almost any novel high-tech product, consumers are uncertain of their requirements, so producers engage in guesswork to try and identify […]
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IP Management Strategies for Profiting from Business Model Innovation
A company’s business model is the ultimate measure by which it is judged, as it expresses the underlying logic of its business. Most importantly, it explains how it creates and captures value—something The Economist describes as a company’s raison d'être. So how do you ensure something so important remains secure from competition? One way is […]
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If the Price is Right: Charging for Online Content
Plummeting advertising revenues have led many online content providers to experiment with additional sources of revenue. Most often, firms aim to compensate for a loss in advertising revenues by charging consumers for access to online content. However, such a choice is not straightforward since subscription fees typically deter customers, further reducing advertising revenues. Acknowledging the […]
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All-consuming: Brand Management in the Digital Age
The field of brand management is undergoing a metamorphosis as the pace of change in our world increases. The brand-building process we used to take for granted, particularly in terms of communication, has changed irrevocably. No longer can leaders and their marketing teams rely simply on slick advertising campaigns to market their products, boost the […]
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