Posted in Marketing and Strategy Terms, Total Reads: 774
Capturing the market segment that is not being well-served by the firm's competitors, it is the indirect marketing strategy. It compels the threatened competitor to dilute the marketing efforts and allocate resources or to lose them to the attacker. In the course of growth of a company, diversification of their products and services takes peace in order to reach out to a larger number of consumers. They are particularly dominant in their core market, and earn some profit in peripheral markets which they do not dominate. This these markets can be easy targets for flanking attacks.
Fundamentals of Flanking
In an uncontested market segment, make own move by avoiding direct confrontations.
Before the competition is aware gaining market presence by quick and steady movement.
Do not allow the competitor of recognize you as a threat before you are well established.
Kinds of customers
Under-served customers can be won by flanking. Depending on the competitor’s strengths and weaknesses flanking strategy works. For example: One strategy can we winning over price sensitive customers by providing at cheaper cost, whereas another can target only premium segment customers by giving options to underserved markets.
Responding to a Flank Attack
Resource allocation more to the threatened market.
Product and service quality should be improved in the threatened market.
New products/brands introduction.
Reposition through advertising.
For example: In 1950s Mercedes-Benz targeted the prestige market against General Motores.Inorder to represent Mercedes as a superior car they priced their luxury cars much higher than Cadillac. Thus Cadillac lost the image of luxury car as slowly customers went for Mercedes.
Another example is of Soft-soap company which used innovation by offering the first liquid soap to flank hand-soap competitors.
Flanking strategies work in 2 ways. By creating its own flanker brand, a dominant company may defend against potential flank attacks-Thus a competitor has to Threaten the flanker brand before reaching the core product.