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Bitter Competition The Holland Sweetener Company Versus NutraSweet. Harvard Business School 9794079 Rev November 13, 2000 - Essay Example

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As an outcome of the expiration of aspartame's patent in 1987, it should be expected that NutraSweet is already contemplating the likelihood of more intense rivalry in its market. Being the first in the market to offer aspartame, NutraSweet will be able to form and execute strategic responses to the entry of competitors…
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Bitter Competition The Holland Sweetener Company Versus NutraSweet. Harvard Business School 9794079 Rev November 13, 2000
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Running Head: BITTER COMPETITION: THE HOLLAND SWEETENER COMPANY VERSUS NUTRASWEET Bitter Competition: The Holland Sweetener Company versus NutraSweet
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Date: 13 March 2007
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As an outcome of the expiration of aspartame's patent in 1987, it should be expected that NutraSweet is already contemplating the likelihood of more intense rivalry in its market. Being the first in the market to offer aspartame, NutraSweet will be able to form and execute strategic responses to the entry of competitors. The following list shows the anticipated response of NutraSweet:
1. Capitalize on its first mover advantage.
NutraSweet is expected to defend its market share by emphasizing its strengths primarily because it is currently the largest player and the first to offer the product. The company might choose to embark into an extensive and intensive marketing strategy encouraging customers to patronize its products because it knows better than the potential entrants. The company might also use its strong brand equity to combat threats of competition.
2. Further strengthen strategic alliances with partners.
Even though it gained a name in the consumer market, NutraSweet's revenue still largely come from other business organizations like Coke and Pepsi. In response to the entry of competitors, the company is expected to further forged stronger partnerships with them by giving them special discounts or by decreasing its prices outright.
3. Price more competitively.
With more competition, NutraSweet might also opt to lower the prices of its aspartame both in the consumer and industrial market.
With the aforementioned discussion, it a price war is more likely to happen between NutraSweet and Holland Sweetener Company (HSC). In competing in the market, HSC will capitalize in its production efficiency which will enable it to price more competitively. In fact, what HSC really desires is the lower the price level of aspartame in the market. With this move, it is expected that NutraSweet will respond competitively by lowering its prices especially in the industrial sector. However, in the consumer segment, NutraSweet will maintain its prices and further differentiate its products from the offering of other industry entrants.
Thompson, A. & Strickland , J 2002,Strategic Management.3rd ed. New York McGraw-Hill Read More
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