How much pie does your company have?

 Today's businesses are competing for their respective market shares to capitalize on the 335 million consumers in North America who spend trillions of dollars annually on goods and services.  Whether it's globally or locally it is a consistent battle for businesses to either maintain or gain their market share in today's economy.  Within a market companies jockey for competitive positions.  For example, here in Canada Tim Hortons is the market leader for fast food service largely due to their significant share of the grab and go coffee market. The primary competitors for Tim Hortons would be Starbucks and McDonalds.  The competitive position of these organizations is determined by the market share they possess in their particular industry. 

There are 4 competitive positions in which a company can be in. These positions are: 
1) Market Leaders 
- Has at least 40% market share 
- The firm with the largest market share and leads the market price, changes and product innovations 
2) Market Challengers 
- Has 30 % market sharen
- Are firms fighting to increase market share 
3) Market Followers
- Has 20% market share 
- Are firms that want to hold onto their market share 
4) Market Nichers 
- Has 10% or less market share 
- Are firms that serve small market segments which are not being pursued by other firms 

Whether a company is a market leader or nicher they must use specific strategies to either drive growth or maintain their market share.  For market leaders this may mean attempts to gain share of the market followers and nichers competitive positions.  A prime example of this is Home Depot who is looking to take market share away from some local hardware stores by opening new retail locations in more rural areas.  These retail locations will be significantly smaller than their typical large box warehouses with the hope of creating a more local and community feel to attract consumers.  Companies like Home Depot are often forced to begin looking at alternative strategies so they do not cannablize themselves and this often means taking away market share from different competitive positions. In this case Home Depot is carving out a bit of niche by forcing  on geographic areas which are typically served by local hardware stores. 

If we continue to look at the home improvement and contstruction retail sector the market challenger for tis group would be Lowes.  A market challenger is looking to increase market share and can do so by: 
1) Second Mover Advanage 
- Obeserves what has made the leader successful and attempts to improve upon it 
2) Full Fontal Attack 
- Matches competitor products, advertising, price and distribution efforts-attacks the competitors strengths 
3) Indirect Attack 
- Targets the competitors weaknesses, taking over gaps in the competitors market coverage 

For those smaller hardware stores in tiny communities in cottage country they to must take action to preserve their market share.  Strategies for market Nichers include: 
1) Specialization 
2) Have a large enough market that provides growth potential and garners little interest from competitors (obviously that is not always possible) 

Knowing where your company falls in regards to competitive position is important because it gives you and your organization a look at what opportunities exist as well as what threats may emerge and poetically impacting your market share.