TYPE OF COMPETITIVE ADVANTAGE BEING PURSUED

Lower Cost
A Broad CrossSection of Buyers
Overall LowCost Leadership Strategy Best-Cost Provider Strategy

Differentiation
Board Differentiation Strategy

MARKET TARGET
A Narrow BuyerSegment (or Market Niche Focused LowCost Strategy

Focused Differentiation Strategy

Competitive strategy relates to all the different strategies a company may do to: Gain a competitive advantage Retain existing market share Capture new market share Identify and access new market opportunities Satisfy wants and needs Provide superior value in a product or service Position and differentiate the product Optimize manipulation of the marketing mix Achieve its goals in the competitive market place

1. Low-cost provider strategy *Keeping costs low, yet offering basic features that low cost buyers consider essential. Examples: Wal-Mart Sams 99 Cent Stores The Attic Dollar Tree Dollar General Family Dollar

4. Best cost provider strategy* Targeting: Low cost, differentiation markets (a hybrid) Broad markets and market niches (middle ground) Value conscious buyers Those who shy away from cheap, low-end products and expensive high-end products Willing to pay a fair price for functionality and performance More for the money *Balances low-cost against emphasis on differentiation and positioning

3. Market focused strategy (cost and niche)* Targeting: Price conscious customers (similar to low cost provider strategy) Well defined segments Appealing to cultures and geographical preferences Brand loyal customers Appeal to broad market segments (low cost) Wants and needs of narrow and unique market segment (niche) *Good way to discourage entry of industry leaders *Another differentiation and positioning strategy

2. Broad differentiation strategy Strategic inputs: Customer service Unique tangible and intangible attributes Special order availability Continuous product improvement and innovation (design and features) Make it more difficult for a competitor to copy it Employee skill and knowledge of the product Continuous improvement in organization Defensive strategy