A Business Encyclopedia

Market Challenger Strategies

Definition: The Market Challenger Strategies are the marketing strategies adopted by the firms, either occupying the third or runners-up position in the market, to attack the leader or the immediate competitor with the intention to capture a greater market share and earn huge revenues.

Generally, the market challengers are those firms, which have a good reputation in the market and enjoys a strong financial position. These firms target the market leader or the competitor at the same level with the objective, to reach the first position in the market or become an industry leader.

Market Challenger Strategies

The following are the general attack strategies adopted by the market challengers with a view to becoming a market leader and increase the market share.

market challenger strategies-1

  1. Frontal Attack: The frontal attack is the direct attack, wherein the market challenger matches with the competitor’s product, price, advertising, and promotion activities.

    The market challenger can even cut the price of the product, provided he convinces the customers that the quality is not compromised and is as good as the high priced products.

    E.g. Amul adopted this strategy when it launched Amul Kool and Amul Masti Dahi at a low price with the same level of the quality as that of other competitors in the market.

  2. Flank Attack: The flank attack means, attacking the competitor on its weak points. Here the market challenger determines the weak areas of the competitor in terms of two strategic dimensions i.e. Geographic and segmental.

    The challenger finds the areas where the competitor is under performing and then push its marketing strategies in that area. Also, the challenger spot the segments which the competitor left untapped and try to cover that segment through its products and services.

    E.g. L.G has successfully made use of this strategy by introducing the color tv “ Sampoorna” for the rural people and outshine the other colored TV players who had a less focus on these areas.

  3. Encirclement Attack: The encirclement attack means, attacking the market leader or a competitor from all the fronts simultaneously, it is the combination of both the frontal and the flank attack.

    Here, the market challenger launches several offensive campaigns i.e. surrounds the competitor with a varied brand and forcing the competitor to defend himself from all the sides simultaneously. This strategy is adopted to enjoy the long-term market dominance.

    E.g. The FMCG industry applies this attack more aggressively with the intention to outshine the other. ITC and HUL could be the best examples.

  4. Bypass Attack: The bypass attack is the indirect attack, wherein the market challenger does not attack the leader directly, but broaden its market share by attacking the easier markets.

    The challengers can bypass the leader by following any of the strategies viz. Expanding into the untapped markets, diversifying into the unrelated products, modernizing the existing product with the invention of technology.

    E.g. Pepsi adopted this strategy when it launched its mineral water brand “Aquafina” very well before the Coca Cola’s mineral water brand.

  5. Guerrilla Warfare: The Guerrilla warfare is the intermittent attacks imposed by the challenger to demoralize the competitor by adopting both the conventional and unconventional means of attack.

    E.g. The Pepsi and Coca-Cola follow this strategy aggressively with the intention to harass each other.When the Coca-cola was the official partner of the world cup, the Pepsi counter-attacked it by using the punch line “ Nothing official about it”.

Thus, These are the major market challenger strategies that a firm may follow depending on its market position and the amount of resources held with the firm.

Leave a Reply

Your email address will not be published. Required fields are marked *


Related pages

grand strategy matrix exampleorganisational hierarchy definitionwhat affects price elasticity of demandbanking lockboxeconomic jargonsdefine abraham maslowseven c's of effective communicationdifference between implicit cost and opportunity costquata samplingdefinition of queuingsematic definitionmonopoly characteristics economicsdefine perfect competition in economicsstagger meaning and definitionoligopoly defgeographical segmentation in marketingporter's five forces of competitionholistic approach meaning in urdukiosk meanmeaning of disbursement in hindibargaining power of buyers definitionblake mouton gridgeocentric attitudeattack marketing and promotionsfx spot transactionhrm meanscost ascertainmentobt meaningrbi open market operationsimportance of ethnocentrismcheque clearance procedurethe definition of ethnocentrismlaw of diminishing marginal utility exceptionsdiagram of price elasticity of demandtheory of wage determinationdisadvantages of tall organizational structuredsp merrill lynch mutual fundways of controlling inflationexample of concentric diversificationprocess reengineering techniquesmeaning of poacherexplain the characteristics of indifference curvescales meaning in hindipf for employeeinventory turnover ratio meaningphotocopy machine definitionoperant theory of motivationhrm auditnominal group technique ngtmax weber bureaucratic theory of managementdecision variables linear programmingdry lease meaningpayroll dashboardinitial outlay definitionwhat does ppf mean in economicsthe cobb-douglas production functionitr returnthe provident fund actblack scholes model assumptionscomputerised stock controllaw of diminishing marginal utility exceptionsfactors that affect consumer buying behaviorhedge funds explainedhow to graph production functionlinear programming simplexcurrency arbitrageppf financereinforcement theory bf skinnerliquidity ratio meaningformulating linear programming problemsauthorized meaning in urduwhat is teleological theorybureaucracy of max weber