Bangabandhu Sheikh Mujibur Rahman Science & Technology
University Gopalganj-8100
Course Title: Competitive Analysis
Course code: MKT411
Submitted by
Submitted to
Kazi Fahim shahriyar
Md. Hafizur Rahman
16MKT008
Assistant Professor
Year: 4th,Semester: 1st
Department of Marketing
Department of Marketing
BSMRSTU
BSMRSTU
Date of submission: 5th July 2021
How you categories Who are not price sensitive?
The customer is more value delicate in the event that he can undoubtedly analyze the different
items in the business sectors. Seen substitute if the customer gets a comparable substitute for any
items at a lower value then he turned out to be exorbitant cost delicate towards it. Organizations
can decrease value affectability of customers and have more extension for moving their Pricing
systems. Cost affectability of customers will decide the scope that an organization will have in
expanding its cost. An organization should know the value affectability of its customers and the
elements influencing it. In specific circumstances, an organization might have the option to
investigate freedoms to lessen value affectability of its customers in the event that it fosters a
sharp comprehension of his inspirations in making the buy, the reason for which he utilizes the
item and the actual idea of the item.
Loyal buyers: Loyal buyers do not be a price sensitive. Loyal buyers always buying products
without thinking what about price. Loyal buyers are a wealth of company. Company easily
raising their profit margin to sell their products.
Quality products: Buyers also trying to get a quality product. S/he doesn’t care about price. If
company can meet their quality requirement, then they are satisfied. Company didn’t need to
worry about categories who are price sensitive or not
► A customer will be price sensitive if he can easily shop around and assess the relative
performance and price of alternatives. Advances in information technology will enable
customers to increase their awareness of prices and access to alternative options. Price sensitivity
of customers is going to increase in a wide range of products and services.
► A company will have to make it difficult for customers to evaluate quality and make
comparisons. A company should desist from using purely functional attributes as competitive
parameters. In most categories, with some ingenuity, products can be imbued with some sense of
style, fashion, color, sensuality and grandeur. Customers will be unable to put a monetary value
to these attributes. In hard-to-judge categories such as perfume price has little impact because the
customers assume that high price and high quality go together.
► It will be dangerous to deny access to one’s product, or information about it, as the customer
may just refuse to buy unless he has made the required comparisons. The only solution will be to
imbue the product with elements of style, fashion and sensuality which will make comparisons
difficult.
► A customer will be price sensitive if he can take the time he needs to locate and assess
alternative. For instance, in an emergency, the speed of delivery will be crucial. Price will not be
the primary factor determining the purchase. A sense of urgency has to be created in the buying
situation. Products may have to be phased out more regularly and threats of impending stock-
outs should sound real. A customer will be price sensitive if he can switch from one supplier to
another without incurring additional costs.
► A customer will also be price sensitive if the long-term relationship with the company and its
reputation are not important and the customer’s focus is on minimizing the cost of the particular
transaction. Easing the process of procurement for the customer by taking responsibility of
maintaining enough inventory with the customer and ensuring automatic replenishment will bind
the customer to the seller. He will not be sure if the next supplier will do so much.
The seller will have to prompt the customer to invest in the relationship. Joint efforts and
exercises to increase quality and productivity will keep the customer interested in the
relationship. The customer should be made to feel that he is getting more than the product or the
service that he is buying from the seller. The seller has to create a web of service and interaction
around the product sold and shift the customer attention from the product.
If the competitor is a large company, its corporate parent is likely to impose
constraints or requirements on the business unit that will be crucial to
predicting its behaviors. What are question needed to be asked?
For this competitor, there are some questions needed to be asked. They are given blew.
• What are the current situation of the parent company?
As a first approximation, this gives an indication of the parent's targets that may be translated
into market share objectives, pricing decisions, pressure for new products, and so on, for its
business unit. A business unit performing worse than the parent as a whole is usually feeling the
pressure.
• What are the corporate wide values or beliefs of top management?
Do they seek technological leadership in all their businesses? Do they desire level production
and the avoidance of layoffs to carry out a corporate policy against unions?' These sorts of
corporate wide values and beliefs will usually have an effect on the business unit.
• What strategic importance does the parent attach to the particular business unit in
terms of its overall corporate strategy?
Does the corporation view this business as a "base business" or one on the periphery of its
operation? Where does the business fit into the parent's portfolio?
• What are the overall goals of the parent?
In view of these, what are the parent's probable needs from its business unit?
• Why did the parent get into this business?
This factor will give some further indication of the way in which the parent views the
contribution of the business and the probable pressure it will place on the unit's strategic posture
and behavior.
• What is the economic relationship between the business and others in the parent
company's portfolio?
What does this relationship imply for special requirements the corporation may place on the unit
relative to the way it would behave as a freestanding company? Shared facilities, for example,
may mean that the unit is under pressure to cover overhead or absorb excess capacity generated
by its sister units. Or if the unit is complementary to another division in the parent, the parent
may choose to take the profits elsewhere. Interrelationships with other units in the company may
also imply cross subsidies in one direction or another.
• Is there a generic strategy that the parent has applied in a number of businesses and
may attempt in this one?
For example, Bic Pen has employed a strategy of low-price, standardized, disposable products
produced at very high volumes with heavy advertising to compete in the
areas of writing instruments, cigarette lighters, pantyhose, and now razors. Haynes Corporation
is in the process of applying the L'eggs strategy in pantyhose to such diverse businesses as
cosmetics, men's underwear, and socks.
• Given the performance and needs of other units.
ln the corporation and the overall strategy, what sorts of sales targets, hurdles for return on
investment, and constraints on capital might be placed.
So, those are the questions for the company.
