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CRAFTING THE BRAND POSITIONING | CHAPTER 10 279

• Cirque du Soleil reinvented circus as a higher form of entertain- 4. Which factors should we create that the industry has never
ment by eliminating high-cost elements such as animals and en- offered?
hancing the theatrical experience instead. They maintain that the most successful blue-ocean thinkers took
Kim and Mauborgne propose four crucial questions for marketers advantage of all three platforms on which value innovation can take
to ask themselves in guiding blue-ocean thinking and creating value place: physical product; service including maintenance, customer serv-
innovation: ice, warranties, and training for distributors and retailers; and delivery,
meaning channels and logistics.
1. Which of the factors that our industry takes for granted
should we eliminate? Sources: W. Chan Kim and Renée Mauborgne, Blue-Ocean Strategy: How to
Create Uncontested Market Space and Make the Competition Irrelevant
2. Which factors should we reduce well below the industry’s
(Cambridge, MA: Harvard Business School Press, 2005); W. Chan Kim and
standard? Renée Mauborgne, “Creating New Market Space,” Harvard Business
Review, January–February 1999; W. Chan Kim and Renée Mauborgne, “Value
3. Which factors should we raise well above the industry’s
Innovation: The Strategic Logic of High Growth,” Harvard Business Review,
standard? January–February 1997.

ANALYZING COMPETITORS Chapter 2 described how to conduct a SWOT analysis
that includes a competitive analysis. A company needs to gather information about
each competitor’s real and perceived strengths and weaknesses. Table 10.2 shows the
results of a company survey that asked customers to rate its three competitors, A, B, and
C, on five attributes. Competitor A turns out to be well known and respected for
producing high-quality products sold by a good sales force, but poor at providing product
availability and technical assistance. Competitor B is good across the board and excellent
in product availability and sales force. Competitor C rates poor to fair on most attributes.
This result suggests that in its positioning, the company could attack Competitor A on
product availability and technical assistance and Competitor C on almost anything, but it
should not attack B, which has no glaring weaknesses. As part of this competitive analysis for
positioning, the firm should also ascertain the strategies and objectives of its primary
competitors. 11
Once a company has identified its main competitors and their strategies, it must ask: What is
each competitor seeking in the marketplace? What drives each competitor’s behavior? Many factors
shape a competitor’s objectives, including size, history, current management, and financial situa-
tion. If the competitor is a division of a larger company, it’s important to know whether the parent
company is running it for growth or for profits, or milking it. 12
Finally, based on all this analysis, marketers must formally define the competitive frame of
reference to guide positioning. In stable markets with little short-term change likely, it may be
fairly easy to define one, two, or perhaps three key competitors. In dynamic categories where
competition may exist or arise in a variety of different forms, multiple frames of reference may
arise, as we discuss next.

TABLE 10.2 Customers’ Ratings of Competitors on Key Success
Factors

Customer Product Product Technical
Awareness Quality Availability Assistance Selling Staff

Competitor A E E P P G
Competitor B G G E G E
Competitor C F P G F F
Note: E = excellent, G = good, F = fair, P = poor.