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SECTION 8: CHOOSING STRATEGIC DIRECTION - Coggle Diagram
SECTION 8: CHOOSING STRATEGIC DIRECTION
STRATEGIC DIRECTION
ansoff's matrix
a strategic or marketing planning tool that links a business's marketing strategy with its general strategic direction
market penetration
lowest risk - developing an established product in an established market
needs to be room to grow
market development
medium risk - a new market for pre existing products
depends on market being accessible
new product development
medium risk - a new product in an established market
may involve producing and selling products the company has limited experience with
diversification
highest risk - new product in a new market
involves a greater risk as a business is moving into an area in which it has no experience
a course of action or plan that is hoped will lead to the achievement of long term goals
impacts on the choice of strategic direction
objectives and attitudes to risk
cost
barriers to entry
competitors actions
ethic involved
STRATEGIC POSITIONING
relates to how that business is perceived realtive to other businesses in the same industry
porters generic strategy
how a business might prusie competitive advantage accross ots market using either low cost differentiation or focus strategy
low cost strategy
offering the lowest costs to customers in the market
differentiation strategy
making products differnet and more attractive than those of its competitors
focus strategy
targeting a niche market with either a low cost strategy or differentiation strategy
Bowman's strategic clock
a model used to explore strategic positioning in order to arrive at the most competitive position in the market
influences on the choice of strategic positioning
the business itself
the competition
customers
external environment
the value of different strategic positioning strategies
bowman gives an insight into the possibilities available to a business in termsd of price and perceived value
porters generic strategy of low cost and differentiation are easier to use and offer more insight into the business world
any business needs to treat positioning seriously and it needs to fit clearly with the mission, objectives, customers perception and expectations
COMPETITIVE ADVANTAGE
benefits
greater sales
better brand loyalty
better profit
better shareholder value
difficulties of maintanence
developments in technology
investment
financial constraints
short terminism
financial constraints
