Aggressiveness

strategy

Business strategies can be categorized in

many ways. One popular method is to
assess strategies based on their degree of
aggressiveness. Aggressiveness
strategies are rated according to their
marketing assertiveness, their risk
propensity, financial leverage, product
innovation, speed of decision making,
amongst others. Typically the range of
aggressiveness strategies is classified
into four categories: prospector, defender,
analyzer, and reactor.

Prospector strategy
This is the most aggressive of the four
strategies. It typically involves active
programs to expand into new markets and
stimulate new opportunities. New product
development is vigorously pursued and
offensive marketing warfare strategies are
a common way of obtaining additional
market share. They respond quickly to any
signs of market opportunity, and do so
with little research or analysis.
A large proportion of their revenue comes
from new products or new markets. They
are often highly leveraged, sometimes with
a substantial equity position held by
venture capitalists. The risk of product
failure or market rejection is high. Their
market domain is constantly in flux as new
opportunities arise and past product
offerings atrophy.

They value being the first in an industry,

thinking that their “first mover advantage”
will provide them with premium pricing
opportunities and high margins. Price
skimming is a common way of recapturing
the cost of development. They can be
opportunistic in headhunting key
employees, both technical and managerial.
Advertising, sales promotions, and
personal selling costs are a high
percentage of sales.

Typically the firm will be structured with

each strategic business unit having
considerable autonomy. The industry that
they operate in tends to be in the
introduction or growth stage of its life
cycle, with few competitors and evolving
technology

Defender strategy
This strategy entails a decision not to
aggressively pursue markets. As a result,
they tend to do none of the things
prospectors do. A defender strategy
entails finding, and maintaining a secure
and relatively stable market. Rather than
being on the cutting edge of technological
innovation, product development, and
market dynamics; a defender tries to
insulate themselves from changes
wherever possible.

In their attempt to secure this stable

market they either keep prices low, keep
advertising and other promotional costs
low, engage in vertical integration, offer a
limited range of products, or offer better
quality products or customer service. They
tend to be slower in making decisions and
will only commit to a change after
extensive research and analysis.

Their goals tend to be efficiency oriented

rather than effectiveness oriented. The
industry tends to be mature, with well
defined technology, products, and market
segments. Most sales tend to be repeat or
replacement purchases. Individual
strategic business units typically have
moderate to low levels of autonomy.

Analyzer
The analyzer is in between the defender
and prospector. They take less risk and
make less mistakes than a prospector, but
are less committed to stability than
defenders. Most firms are analyzers. They
are seldom a first mover in an industry, but
are often second or third place entrants.

They tend to expand into areas close to

their existing core competency. Rather
than develop wholly new products, they
make incremental improvements in
existing products. Rather than expanding
into new markets, they gradually expand
existing markets. They try to maintain a
balanced portfolio of products with some
stable income generators and some
potential winners. They watch the
developments in their industry closely, but
don’t act until they are sure that the time is
right.

Reactor
A reactor has no proactive strategy, often
reacting to events as they occur. They
respond only when they are forced to by
macro environmental pressures. This is
the least effective of the four strategies. It
is without direction or focus.

Miles, Snow et al. (1978) have identified

three reasons why organizations become
Reactors:

Top Management may not have clearly

articulated the organization's strategy.
Management does not fully shape the
organization's structure and processes
to fit a chosen strategy.
Tendency for Management to maintain
the organization's current strategy-
structure relationship despite
overwhelming changes in environmental
conditions.

See also
marketing strategies
marketing warfare strategies
 strategic planning
strategic management
Porter generic strategies

References
Miles, R.E. and Snow, C. (1978)
Organizational Strategy, Structure and
Process, New York, McGraw Hill, 1978.
Walker, O. and Ruekert, R. (1987)
Marketing's role in the implementation
of business strategies, Journal of
Marketing, July 1987, pg 31.
Boyd, H. and Walker, O. (1990) Marketing
Management, A Strategic Approach,
Boston, Irwin, 1990, ISBN 0-256-05827-X
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