Module 15 Marketing Strategies for New Markets By: Dr Shahinaz Abdellatif Objective of this session 1. To discuss the major strategic issues in new markets New Products How new is new? New-to-the-world products – True innovations that are new to the firm and create an entirely new market (10 per cent). New product lines – A product category that is new for the company introducing it, but not new to customers in the target market because of the existence of one or more competitive brands (20 per cent). Additions to existing product lines – New items that supplement a firm’s established product line. These items may be moderately new to both the firm and the customers in its established product-markets. They also may serve to expand the market segments appealed to by the line (26 per cent). How new is new? Improvements in or revisions of existing products – Items providing improved performance or greater perceived value brought out to replace existing products. These items may present moderately new marketing and production challenges to the firm, but unless they represent a technologically new generation of products, customers are likely to perceive them as similar to the products they replace (26 per cent). Repositionings – Existing products that are targeted at new applications and new market segments (7 per cent). Cost reductions – Product modifications providing similar performance at lower cost (11 per cent). Sources of Competitive Advantage Pioneer & Advantage Pioneer Economics of scales and experience. High switching costs for early adopters. Pioneer defines the rules of the game. Distribution advantage. Influence on consumer choice criteria and attitudes. Possibility of pre-empting scarce resources. Follower Ability to take advantage of pioneer’s positioning mistakes. Ability to take advantage of pioneer’s product mistakes. Ability to take advantage of pioneer’s marketing mistakes. Ability to take advantage of the latest