1.

Type of strategies

1.1 Differentiation strategy

A differentiation strategy focuses on providing a product or a service with distinctive

attributes, in comparison with the competition, to reach a broad market. In other words,
differentiation involves making your products or services different from and more attractive
than those of your competitors. How you do this depends on the exact nature of your industry
and of the products and services themselves, but will typically involve features, functionality,
durability, support, and also brand image that your customers value.

1.2 Cost Leadership strategy

Cost leadership strategy can be defines as a method to reduce costs and produce the
least expensive goods in a market or industry in an effort to gain market share. The modern
business environment is a very complex and sophisticated one with consumers being aware
of the choices available to them. One way firms differentiate themselves is through
competitive pricing. Businesses that have the least production costs are able to offer the same
level of product quality compared to their competitor for a much lower price.

2. Type of industries

2.1 Emerging industry

An emerging industry is an industry which is at its early stage of development. In fact,

it is an embryonic or ‘infant industry.’ It is just beginning to develop or emerge. An emerging
industry is characterized by few competitors, high growth potential, the uncertainty of
demand, the dominance of proprietary technology, wide differences in product quality, low
entry barriers, difficulty in having ample supply of raw materials, and so on. Although
growth potential in the emerging industry is high, the actual growth at this stage is slow. Slow
growth is mainly attributed to customers’ unfamiliarity with products. Other reasons include
usually high prices due to the producers’ inability to achieve economies of scale and weak
distribution channels.

Example: LUSH (Differentiation strategy)

Lush is unlike any other makeup brand on the marketplace. This cosmetics maker has
international reach with a local "warm and fuzzy" approach that isn't afraid to push the
boundaries. So, what makes LUSH so different from the likes of Sephora or even Etsy?
Handmade products. Advocates of LUSH are committed to ethical buying, and are obsessed
with the purity that comes from a handmade item. The company's biggest success is know
that its core buyers value social and corporate responsibility over a luxurious and out-of-
reach image. LUSH's branding is simple and genuine, with great contrast between visuals that
is simply not seen elsewhere. For that reason, the company has a massive brand-loyal
following.

Example: A.I healthcare (Cost Leadership strategy)

Artificial intelligence tech has made leaps and bounds in the last couple of years. The
most likely explanation for why we’re seeing more AI healthcare companies lately is that
we’ve only just now reached a point where the tech can actually deliver. On top of that,
affordable healthcare is still largely unavailable to a lot of people, including those in first-
world countries. Even people with access to good healthcare find products like these to be
more convenient time-savers

2.2 Maturity industry

A mature industry is an industry that has passed both the emerging and growth phases
of industry growth. At the beginning of the industry lifecycle, new products or services find
use in the marketplace. Many businesses may spring up trying to profit from the new product
demand. Over time, failures and consolidations will distil the business to the strongest as the
industry continues to grow. This is the period where the surviving companies are considered
to be mature. Eventually, growth will slow as new or innovative products or services replace
this industry offering and begin a new industry lifecycle.

Example: T-Mobile (Differentiation strategy)

T-Mobile is a cellular company that's shedding what it means to be a cellular company.

Catering to a smaller, younger niche audience, T-Mobile finds its differentiation opportunity
by targeting urban dwellers -- those who don't want to be tied down and "owned"by their
cellular company. By listening and following the behaviors of their core customer, the
business focuses on more attributes of its audience than competing companies -- which, while
perhaps larger, don't seek to offer the personal connection T-Mobile has made with so many
of its customers.
 Example: Walmart (Cost Leadership strategy)

The most famous cost leader is Walmart, which has used a cost-leadership strategy to become
the largest company in the world. The firm’s advertising slogans such as “Always Low
Prices” and “Save Money. Live Better” communicate Walmart’s emphasis on price slashing
to potential customers. Meanwhile, Walmart has the broadest customer base of any firm in
North America. Approximately 100 million of us visit a Walmart in a typical week
(Zimmerman & Hudson, 2006). Incredibly, this means that roughly one-third of Americans
are frequent Walmart customers. This huge customer base includes people from all
demographic and social groups within society.

In 2014, Walmart faced stiff completion from dollar store chains coupled with growing
competition from Amazon.com and Internet shopping as more and more people shop online.
Walmart has been sharpening its focus on everyday low prices and further pushing that
strategy abroad. Interestingly, Walmart’s success has been somewhat limited in their
international expansion efforts. Having exhausted the potential sales market for big-box
stores, with over 90 percent of North Americans living within fifteen minutes of a Walmart,
the company is planning to accelerate growth plans for smaller Neighborhood Markets and
Walmart Express stores that cater to shoppers looking for more convenience with fresh
produce and meat and household and beauty products (Anderson, 2014).

2.3 Declining industry

A declining industry is an industry where growth is either negative or is not growing

at the broader rate of economic growth. There are many reasons for a declining industry:
consumer demand may be steadily evaporating, the depletion of a natural resource may be
occurring or there may be the emergent substitutes because of technological innovation.

Example: Tower Records (Differentiation strategy)

The disappearing act of music superstore Tower Records last year serves as any indication,
the traditional music retail industry is hurting—badly. The legal and illegal downloading of
MP3 files has almost certainly contributed to the plummet in traditional album sales, which
have fallen by more than one third since 2000, according to an article in The New York
Times last April.
The DVD retail and rental industries may experience a similar cooling, as the option to
stream movies over the Internet becomes increasingly available. Apple Inc., for instance, has
made headlines with the launch of its movie rental streaming feature via iTunes software.
NetFlix, which has already claimed a significant chunk of business from traditional brick-
and-mortar video rental stores with its mail order service, has recently begun to offer similar
movie streaming capabilities for a limited selection of films.

Example: YUGO (Cost Leadership strategy)

It is tempting to think of cost leaders as companies that sell inferior, poor-quality

goods and services for rock-bottom prices. The Yugo, for example, was an extremely
unreliable car that was made in Eastern Europe and sold in the United States for about $4,000
in the 1980s. Despite its attractive price tag, the Yugo was a dismal failure because the car
was so poorly made that drivers simply could not depend on the car for transportation. Yugo
exited North America in the early 1990s and closed down entirely in 2008.

References

Anderson, M. (2014, May 15). Poor weather dents Wal-Mart 1Q results; 2Q earnings forecast
misses analysts’ expectations. Retrieved from
http://www.winnipegfreepress.com/business/bad-weather-hurts-wal-mart-in-1q-gives-2q-
earnings-forecast-below-analysts-expectations-259358851.html

Zimmerman, A., & Hudson, K. (2006, April 17).  Managing Wal-Mart: How US-store chief
hopes to fix Wal-Mart. Wall Street Journal.