PERTANIKA JOURNAL OF TROPICAL AGRICULTURAL SCIENCE

In marketing terms, the phenomenon of a price wars is regarded as the result of intense competition and retaliatory reaction in order to win market share. However, several literatures had acknowledged that this condition was the result of an abnormal internal condition, where firms competed not to engage in competitive selling activities but rather as an effort to maintain performance. This paper was written and prepared as part of a recent study in the Indonesian lighting industry, where many players in the industry considered themselves caught in a severe price war condition. Based on a qualitative survey using open-ended interviews of seven lighting companies in Indonesia, the study found that the industry regard price wars as the result of severe intra-brand competition and an effort to maintain the “status quo” of continuous growth. Propositions to ease friction in price were suggested: exploration to other market segments; exploiting information to induce loyalty; understanding rivalry through capacity size; and management of short-term performance constraints.