Chapter 4: Analysing the Competitive Situation

Pure Competition

 Industry competition in which numerous sellers of a standardized product market to well informed
buyers(Mainly commodity markets)
 Broad range of competitors selling the same products
o Number of firms: Numerous
o Type of Product: Homogeneous
o Ease of Market entry: No Barriers
o Price Control: None
o Importance of Promotion: Unimportant
o Key Marketing Tasks: Attempt Lower Product and Distribution Costs

Oligopoly

 Industry in which few firms dominate the market of the products

o Number of firms: Few
o Type of Product: Similar
o Ease of Market entry: Major Barriers
o Price Control: Some, with care
o Importance of Promotion: Important
o Key Marketing Tasks: Understand competition and react quickly; strive for non-price
advantage