Strategies in Declining and Hostile Markets

1
Chapter 14
Strategies in Declining and Hostile Markets
2
Anyone can hold the helm when the sea is
calm. - Publilius Syrus
3
Where there is no wind, row. - Portuguese
proverb
4
A ship in the harbor is safe. But thats not
what ships are built for. - Anonymous
5
Revitalizing a Stagnant Market
New Markets
New Products
Revitalized Markets
New Applications
Revitalized Marketing
Governmental-Stimulated Growth
Exploitation of Growth Submarkets
Figure 14.1
6
Strategies for Declining or Stagnant Industries
Business Position in Key Segments
Invest or hold
Milk or exit
Industry Environment
Exit
Milk or exit
Figure 14.2
7
The Investment Decision in a Declining Industry

• Some Strategic Uncertainties
• Market Prospects
• Competitive Intensity
• Performance/Strengths
• Interrelationships With Other Businesses
• Implementation Barriers

Figure 14.3
8
Six Phases of Hostility

• Phase 1 - Margin pressure
• Phase 2 - Share shifts
• Phase 3 - Product proliferation
• Phase 4 - Self-defeating cost reduction
• Phase 5 - Consolidation and shakeout
• Phase 6 - Rescue

Figure 14.4