Here a dominant leader plays a competitive hardball when smaller rivals rock the boat with price cuts or mount any new market offensives that directly threaten its position. Specific responses can include quickly matching or exceeding challengers’ price cuts, using large promotional campaigns to counter challengers’ moves to gain market share, and offering better deals to their major customers. The leader may also use various arm-twisting tactics to pressure present customers not to use the products of rivals. The obvious risks of a muscle-flexing strategy are running afoul of the antitrust laws, alienating customers with bullying tactics, and arousing adverse public opinion.
CORE CONCEPT: Industry leaders can strengthen their long-term competitive positions with strategies keyed to aggressive offense, aggressive defense, or muscling smaller rivals and customers into behaviors that bolster its own market standing.
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