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BUSINESS LEVEL STRATEGIES, Group 5 - Coggle Diagram
BUSINESS LEVEL STRATEGIES
Best-Cost Provider
Low Cost Provider
Charging a lower price than rivals with similar caliber product offerings
Differentiation
Providing desired quality/ features/performance/ service attributes
Value
Conscious Buyer
Broad Differentiation
Effective Differentiation Approaches
Carefully study buyer needs and behaviours, values and willingness to pay a unique product or service.
Incorporate features that both appeal to buyers and create a sustainably distinctive product offering.
Use higher prices to recoup differentiation costs.
Advantages of Differentiation
Premium prices for products
Increased unit sales
Brand loyalty
Market Circumstances Favoring Differentiation
Diversity of buyer needs and uses for the product
Many ways that differentiation can have value to buyers
Few rival firms follow a similar differentiation approach
Rapid change in technology and product features
Pitfall of a board differentiation strategy
Relying on product attributes easily copied by rivals
Charging too high a price premium
adding frills and features such as that the product exceeds the need and use of most buyer
Low-Cost Provider
Effective Low-Cost Approaches
**
Pursue cost-savings that are difficult to imitate.
Competitive Advantages and Risk
s
Low pricing does not attract enough new buyers
When a Low-Cost Provider Strategy Works Best
Price competition among rival sellers is vigorous.
Products are readily available from many sellers
Pitfalls of a Low-Cost Provider Strategy
Lowering selling prices results in gains that are smaller than the increases in total costs, reducing profits rather than raising them.
Focused
Low-Cost
Companies use Focus strategies to concentrate on a particular market, by understanding the dynamics of that market and the unique need of customer within it
Help the company to develop uniquely low cost or well-specific product for the market
Build strong brand loyalty amongs their customer
Example
Tata Starbucks Ltd is a 50:50 joint venture company :recycle: :star:
Tata Starbucks targeted at urban youths, office and families
Locailzed menu which is loved by the Indians
Focused Differentiation
Focuses on targeting a small group of consumers with unique offers.
Focused on narrow segments.
The firm offering unique features to small market segment
In contrast, a differentiation focus strategy focuses on narrow market coverage, seeking only to attract a small, specialised segment.
Exp: mercedes-benz
Group 5
KHAINOR ARIF BIN KAMARUDDIN (62211122267)
MUHAMMAD AFIF DZUL BIN ZULKEPLI (62211122448)
MUHAMMAD AZRI BIN ROSNIZAR (62211122410)
MUHAMMAD NOR ADHAM BIN MAT SAFAR (62211122186)