Media
Management
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Competitive Strategy
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Strategy
Strategy involves a range of a firm’s
decisions and activities that are
enacted to fulfill the firm’s strategic
missions and goals through the
effective use of skills and resources,
considering the opportunities and
threats in its market environment.
- Sylvia Chan-Olmsted (2006)-
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Competitive Strategy
What is the Organization Doing Now?
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Competitive Strategy
What is happening in the Environment?
– Industry Analysis
What are the key factors for competitive success
What are the important industry opportunities and
threats
– Competitor Analysis
– Society Analysis: What important
government, social and political factors will
present opportunities or threats?
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Competitive Strategy
What should the Organization be doing?
– Strategic alternatives
What are the feasible strategic alternatives
Is the current strategy one of those
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Competitive Strategy
What should the Organization be doing?
– Strategic choice: which alternative best relates
the company’s situation to external opportunities
and threats
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Porter’s Competitive Strategy
Porter’s Five Forces (1985).
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Competitive Strategy:
Porter’s Generic Strategies
Michael E. Porter (1980; 1985).
Competitive Strategy; Competitive Advantage
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Porter’s Competitive Strategy
Porter’s Generic Strategies (1985).
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Competitive Strategy:
Porter’s Generic Strategies
 Segmentation (Focus): Strategies to produce
goods or services that serve the needs of a particular
competitive segment.
 Differentiation: Strategies to produce goods or
services that customers perceive as being different in ways
that are important to them.
 Cost leadership: Strategies to produce goods or
services with features that are acceptable to customers at
the lowest cost, relative to that of competitors.
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Generic Strategies:
Segmentation Hierarchy
Niche A1
Segment A
Segment A
Custom A1
Custom A2
Custom A3
Custom B1
Segment B
Segment B
Custom B2
Segment C
Segment C
Multisegment
Strategy
Single
Segment
Strategy
Mass
Market
Approach
= Target Market
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Custom C1
Segment
Niche
Strategy
Mass
Customization
Mass Marketing (Example)
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Market Segmentation
(Example)
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Generic Strategies:
Differentiation
 Differentiation = superiority /
uniqueness relative to competition
 Example: Two or more products and
services that exhibit different features,
styles, quality and sizes
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Generic Strategies:
Cost-leadership
• Cost-leadership = Broad target + lowest cost
 No-frills, standardized goods or services
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Team
Any questions?
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SWOT Analysis
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SWOT Analysis
A SWOT analysis is a strategic planning
tool for assessing organizational
resources and evaluating environmental
risks and opportunities
A SWOT analysis is a method of
studying organizational resources and
capabilities to assess the firm’s strengths
and weaknesses and scanning its
environment to identify opportunities and
threats
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SWOT Analysis
S
Strengths
W
Weaknesses
O
Opportunities
T
Threats
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SWOT Analysis
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SWOT Analysis
(e.g.): CNN
Strengths
Strong brand portfolio
Weaknesses
Global operations
Loss of leadership position
Vulnerability to
Outside Environmental Factors
Relationship with Time Warner
Foreign Business Risks
Opportunities
Advertising turnaround
Threats
Competition
Expansion into emerging markets Piracy
FCC legislation on children's
Online medium
programming
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IO View &
Resource-Based
View of Strategy
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Competitive Strategy:
Industrial Organization View
 Based primarily on industrial organization
concepts (industrial economics)
 IO view focused on the linkage between a
firm’s strategy and its external environment
 A strategy is formulated to benefit from the
exogenous factors
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IO View & Environmental Factors
of Electronic Media Firms
Technology Factors
– Broadband Technology
– Media Convergence
– Bandwidth
– Ability to solve technical problem
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IO View & Environmental Factors
of Electronic Media Firms
Economy/Industry Factors
– Economic status
– Industry structure
(e.g. competition)
– Strategic alliance
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IO View & Environmental Factors
of Electronic Media Firms
Consumer Factors
– Consumer demand and preferences for
converged media
– Consumer value: higher speed, mobility,
interactivity, personal access, various
application and multimedia services
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IO View & Environmental Factors
of Electronic Media Firms
Policy Factors
– Globalization
– Political Climate
– Policy System
– Regulation
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Resource-Based View of Strategy
 Each firm is a collection of unique resources
that provide the foundation for its strategy
 Internal resources of a firm and the firm’s
abilities to manage them are critical
 A firm’s resources are the foremost factors
influencing performance and sustainable
competitive advantage
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Resource-Based View of Strategy
What kind of resources?
 Property-based network resources
 Station ownership
 Affiliate contracts
 Top content property
 Knowledge-based network resources
 Management expertise
 New technology expertise
 Media employee pools
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Resources (Resource-based View
of Strategy)
 Reputation (or brand name) and
financial resources are
internal resources of a media firm.
(e.g.) Google and Apple selected a
strategies that best utilize the their
resources (tangible or intangible) and
capabilities.
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Team
Any questions?