Upload
cambridge-marketing-college
View
218
Download
2
Embed Size (px)
DESCRIPTION
People go to war for many reasons. Protecting freedom, family, or country is generally considered a noble one. Undercutting a competitor is not. The top line is a potent weapon—but one that must be wielded with finesse, not machismo.
Citation preview
18 CAMBRIDGE MARKETING REVIEW - ISSUE 8 Q2 2014
CHURN By Don Moyer
Dra
win
g ©
Cop
yrigh
t Feb
ruar
y 200
5 D
on M
oyer
.
Use
d w
ith p
erm
issio
n. O
rigin
ally a
ppea
red
in th
e H
arva
rd B
usin
ess R
evie
w P
anel
Disc
ussio
n co
lum
n.
People go to war for many reasons. Protectingfreedom,family,orcountryisgenerallyconsideredanobleone.Undercutting
acompetitorisnot.Thetoplineisapotentweapon—butonethatmustbewieldedwithfinesse,notmachismo.
Asastrategy,pricecuttingcanbedifficulttosustain;againstmoreefficientcompetitors,it’simpossible.Inhisfirst-ratebookCompetitiveSolutions:TheStrategist’sToolkit,R.PrestonMcAfeepointsoutthatpricewarsbetweenequalsproduceinjuriesonbothsidesandvictoryonneither.Solaunchhostilitiesonlywhenyou’resureyouhaveanoverwhelmingadvantageandcandrivetheotherguyfromthemarket.
Ofcourse,ifacompetitorattacks,you’llhavetoputupyourdukes.Butinpeacetime,itiswisertoinvestinareassuchasR&D,customerservice,andmarketing,whichjustifyraisingprices,notloweringthem.Afterall,cheap-unlikerichandthin-issomethingyoucanbetoexcess.
Don Moyer has collected his series of cartoons as a book, entitled 64 Drawings. It is available from Blurb at www.blurb.com/bookstore/
detail/949041