Previous article
Next article

In a competitive response case, you either need to analyze your client's or its competitors’ moves

In a competitive response case, your job is either to analyze what your client should do in response to a major competitor's strategy or to anticipate what competitors will do in response to a strategy implemented by your client.

Just as with M&A cases, competitive response cases by themselves are rare. Instead, these case types will come disguised as part of a larger business problem. In competitive response cases, it is important to get a good understanding of the current situation and how it can be addressed.

1. Understand the status quo and changes in order to assess the relevance of competitive response

Here too, make sure you fully understand the current situation and how it has changed compared to the past. If, for instance, the case is about the main competitor having introduced a new product, then you will want to know the following:

  • What is the nature of the product and how does it differ from what the client offers?
    1. How important are the new different features to customers?
    2. What will the new features enable the competitor to do? In general, there are two possibilities: a competitor can either charge a higher price for the competing product or take customers away from our client by pricing the product with the differentiating feature competitively against the clients' products.
    3. Why is the competitor introducing it? For instance, have customer preferences changed (need pull) or is there an availability of new technology (technology push)?
  • Which market segment is addressed with the new product and how do we expect these market segments to react?
  • Does the client possess resources that could be used in the context of the new product (expertise, funds, M&A options, production facilities, etc.)?

2. Possible recommendations

There is a variety of potential answers to new product introductions. Often, what an interviewer is trying to assess here is your creativity and ability to produce realistic solutions. Potential answers could be:

  • Make the current product more attractive:
    1. Redesign, repackage the current product.
    2. Change the market segment of the current product (move upmarket or downmarket).
    3. Increase the marketing activity (i.e., increase perceived attractiveness).
    4. Build customer loyalty or increase switching costs (e.g., by adding a loyalty scheme).
    5. Make another dimension of the product more attractive (e.g., cut prices).

  • Introduce a different product:
    1. Acquire the competitor or capabilities for the new product.
    2. Copy the competitor with the client's available resources.

  • Do nothing:
    1. Doing nothing can indeed be a recommendation.
    2. Doing nothing can be a strategy if you want to wait for more information so that you are in a better position to make a decision.

Previous article
Next article
Do you have questions on this article?
Contribute to our Q&A forum and ask the community your question!

Questions on This Article

Is this two-steps approach good enough?

competitive response
Most recent answer on Jul 15, 2021
The best answer (on Jul 15, 2021) is from:
Ian
Expert
Content Creator
BCG | 100% personal interview success rate (8/8) and 95% candidate success rate | Personalized interview prep
Ian
Expert
Content Creator
gave the best answer on Jul 15, 2021
BCG | 100% personal interview success rate (8/8) and 95% candidate success rate | Personalized interview prep
Hi there, This is an intro-level guide - as most are! Competitive Responses are some of the most dynamic cases out there. When you think about it, a competitive response could be a profitability, market entry, M&A ... (read entire answer)
1
Answer
267
Views
16
Total Upvotes
on Jul 15, 2021 on Jul 15, 2021
Last Activity

Related Cases

Company case by Bain & Company
You have inherited the “Old Winery” from your grandfather, a winery that has been family-owned for five generations and can be dated back to the 16th century. Half of the eleven hectares are used to grow white grapes, the other half to grow red grapes. They are grown in a conventional ... (Open whole case)
78.8k
Times solved
Intermediate
Difficulty
Rating
Company case by Consulting@Deloitte
Duraflex is a German footwear company with annual men’s footwear sales of approximately €1 b. They have always relied on the boot market for the majority of their volume. In this market they compete with three other major competitors. In the fall of 2019, Badger – one of Duraf ... (Open whole case)
76.1k
Times solved
Intermediate
Difficulty
Rating
Company case by DHL Consulting
DHL has been the logistics partner of the Wonderworld Music Festival since 2004. DHL transports all material and equipment for the bands from the UK to the festival locations. Also, DHL is one of the main sponsors of Wonderworld (broadcast advertisement, in site coverage etc.). Wit ... (Open whole case)
11.2k
Times solved
Intermediate
Difficulty
Rating
Our client is a French holding company with annual revenues of about €1 billion.      Their portfolio consists of different companies that are mostly in manufacturing industries such as the oil & gas industry and the automotive industry.They do not have a specif ... (Open whole case)
46.6k
Times solved
Intermediate
Difficulty
Rating
Our client is an electronics holding called Chip’n’Chip. They want to invest in a Printed Circuit Board (PCB) manufacturer called OnBoard, and asked you whether it’s going to be a good investment. How would you help them? ... (Open whole case)
39.1k
Times solved
Advanced
Difficulty
Rating