Philip Kotler is the master of marketing. Many a book that has been written by him has been hungrily gobbled up by eager marketing students. In one of his more recent books on Modern Marketing, Kotler explains how traditional marketing tools are no longer as effective as they were in the past.

Not that a revelation like this was a shock to me. In today’s world with the proliferation of the Internet as a major channel in terms of getting customer attention, brand building, product sales and customer management, the marketing playbook has changed. Drastically. » Read more: Modern Marketing: New Rules

Threat of New Entrants

If there are low barriers to entry in an industry, the easier it is for other firms to enter this industry. In such a situation, new entrants could change major determinants of the market environment (e.g. market share, product pricing, customer loyalty) at any time. There is always a hidden pressure for reaction to any change in the market dynamics and adjustment for existing players in this industry. » Read more: Porter’s Five Competitor Forces Model – Part II

Michael Porter’s 5 competitive forces model is the basis of modern business strategy. His model is based on the insight that a corporate strategy should take into account the opportunities and threats in the external environment that the organization operates in.

The competitive strategy should be based on a strong understanding of the industry structure and how it may possibly change. In the online world, this principle does apply though in slightly different ways. » Read more: Porter’s Five Competitor Forces Model – Part I

This is an idea that intrigued me. Why would someone not try to increase their market share? The reasons to do so are overwhelming. All modern and traditional learning stresses that we strive to increase market share as much as possible. The upside is manifold. Increase share equals increased revenue which in turn means happy stockholders.

But, sometimes, it does make sense to hold back and actually not increase your market share. Here are the reasons why… » Read more: When NOT to increase market share