1. Cost Leadership Strategy
The first strategy suggests that a firm either sells their products at either average industry prices to earn higher profit than that of rivals, or below industry average prices to gain market share.
2. Differentiation Strategy
The second strategy suggests developing the product or service so that they offer unique attributes valued by customers and that customers perceive to be better than or different from the products/services offered by the competition. The value added by the uniqueness of the product may allow the firm to charge a premium price for it.
3. Focus Strategy
Lastly, the focus strategy concentrates on a narrow segment and within that segment attempting to achieve either cost advantage or differentiation. The premise is that the needs of the group can be better serviced by focusing entirely on it. A firm using a focus strategy often enjoys a high degree of customer loyalty, and this entrenched loyalty discourages other firms from competing directly.
More specifically:
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