Who competes with whom? A demand-based perspective for identifying and representing asymmetric competition

Wayne Desarbo, Rajdeep Grewal, Jerry Wind

Research output: Contribution to journalReview article

50 Citations (Scopus)

Abstract

A host of strategic management and marketing issues, including competitive analysis and strategic decision making, hinges on accurately identifying and representing competitive market structures. It is readily acknowledged that competitive market structures are typically asymmetric; namely, one firm may actively compete with another in a given market but not vice versa. However, empirical efforts to assess these competitive asymmetries have been lacking in the strategy literature. We propose a new spatial methodology to identify and represent asymmetric competitive market structures. Specifically, we devise a new stochastic multidimensional scaling procedure that is calibrated from actual consumer consideration/choice sets to estimate and uncover competitive asymmetries. The proposed methodology can be effectively employed in the analysis of appropriate data from either demand- or supply-side approaches to assess competitive market structure. We illustrate our proposed methodology with survey data collected from two different commercial applications: one from the U.S. luxury automobile market and the other from the U.S. portable telephone market. We contrast the findings of the proposed methodology against traditional symmetric approaches for identifying and representing competitive market structures, and discuss the respective strategic insights.

Original languageEnglish (US)
Pages (from-to)101-129
Number of pages29
JournalStrategic Management Journal
Volume27
Issue number2
DOIs
StatePublished - Feb 1 2006

Fingerprint

Competitive market
Market structure
Asymmetric competition
Methodology
Asymmetry
Luxury
Strategic decision making
Strategic marketing
Automobile market
Choice sets
Multidimensional scaling
Supply side
Competitive analysis
Telephone
Survey data
Strategic management

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Strategy and Management

Cite this

Desarbo, Wayne ; Grewal, Rajdeep ; Wind, Jerry. / Who competes with whom? A demand-based perspective for identifying and representing asymmetric competition. In: Strategic Management Journal. 2006 ; Vol. 27, No. 2. pp. 101-129.
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Who competes with whom? A demand-based perspective for identifying and representing asymmetric competition. / Desarbo, Wayne; Grewal, Rajdeep; Wind, Jerry.

In: Strategic Management Journal, Vol. 27, No. 2, 01.02.2006, p. 101-129.

Research output: Contribution to journalReview article

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