DEFENSIVE STRATEGY FRAMEWORK IN GLOBAL MARKETS: A MENTAL MODELS APPROACH

Abstract

Purpose - Develop a conceptual framework for defensive strategy by integrating market entry modes and the typology of firms suggested by Day and Nedungadi (1994), and attempt to propose how local incumbent firms utilize their mental models in order to react against market entry of new competition in global markets.

Design/methodology/approach - The theoretical perspective adopted in this study is how mental models used by incumbent firms influence their reaction to market entry of new competition in developing defensive strategies to defend their markets.

Findings - Mental models of Incumbent firms categorized as self-centered, competitor-centered, customer-oriented, and market-driven firms impact their reaction and development of defensive marketing strategies against market entrants using a variety of market entry modes in global markets.
Originality/value - Extensive review of the defensive marketing and mental models literature and how incumbent firms react to market entry of new competition contributes to our understanding of incumbent reaction to market entry of new competition in global markets. Research directions for future research and managerial implications are also provided.

Keywords - Defensive Strategy, Market Entry, Global Marketing, Mental models, Entry Modes, Competition

Paper type - Conceptual paper