Explain three variables a firm should consider when analyzing potential threats posed by competitors.
Answer: In general, the firm should monitor three variables when analyzing potential threats posed by competitors:
1. Share of the market—The competitors' share of the target market.
2. Share of mind—The percentage of customers who named the competitor in responding to the statement, "Name the first company that comes to mind in this industry."
3. Share of heart—The percentage of customers who named the competitor in responding to the statement, "Name the company from which you would prefer to buy the product."