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Essay example - Strategic Choice and Evaluation - Apple
Pages 5 (1255 words)
St All business firms seek competitive advantage over their competitors. Competitive advantage can basically be of two types: low cost and differentiation…
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These strategies are adopted by the firm to achieve better performance help the firm to deliver a better than average performance. Cost leadership A business firm following cost leadership strategy aims at beating its competitors by producing at the lowest cost in the entire industry. The producer can now produce at a large scale and at a very low cost, thereby, enjoying huge economies of scale. The producer exploits the economies of scale which allows the company to maintain competitive pricing (Richardson & Dennis, 2003). Differentiation Under differentiation strategy the company focuses on the products that it offers for sale. It aims at making the products unique by identifying specific product dimensions, which are found to be most valued by its customers. The company develops its marketing strategies in such a manner that it would be able to satisfy the demand of its customers to the most desired level and therefore receive premium price due to the uniqueness of these products (Thompson & Martin, 2010). Focus Focus strategy is followed by a firm when selects one or multiple segments within the single in industry in which it operates (Dinitzen, 2010). The company aims at optimizing its product and marketing strategies to cater to these segments in the most efficient way, such that, it might gain competitive advantage over all other firms that competes with the particular firm. Focus strategy can be applied by the firm by following either of the following strategies; creation of cost advantage within a targeted segment (cost focus) or development of a differentiation strategy within a targeted segment (differentiation).
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