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indirect competition

Indirect competition is the conflict between vendors whose products or services are not the same but that could satisfy the same consumer need. 

The term contrasts with direct competition, in which businesses are selling products or services that are essentially the same. Cloud storage providers are direct competitors, for example, as are manufacturers of notebook computers

However, in recent years, desktop computer sales have dropped as many consumers purchased notebooks instead. Sellers of desktop PCs and notebooks are indirect competitors. 

In the 1960s, Theodore Levitt wrote a highly-influential article called "Marketing Myopia” for the Harvard Business Review recommending that businesses should take a much broader view of the competitive environment. Leavitt argued that the market’s central organizing element is human needs and that the satisfaction of those needs should be the focus of businesses. Products and services are transient but human needs are not. From that perspective, the distinction between direct and indirect competition is unimportant. 

This was last updated in April 2015

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