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Description
Flashcards by Ashleigh-Jade Jones, updated more than 1 year ago
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Created by Ashleigh-Jade Jones
about 7 years ago
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| Question | Answer |
| Strategic Positioning: | how a business is perceived by customers compared with similar businesses in the market |
| Two Models To Analyse Strategic Position/Future Strategies: | -Porters generic strategies -Bowman's strategic clock |
| Porter's Generic Strategies: | model gives firms strategic options based on the markets they operate in and the strategic advantage they offer *Mass/Niche Market *Focus on costs or the product itself *Can also be stuck in the middle (like Clinton's, Nokia etc.) which is likely to lead to failure *Also have hybrid strategies like IKEA (low price but high quality ) |
| Porter's Generic Strategies: (Cost Leadership) | *to become the lowest cost producer in the industry to offer the cheapest price to customers -increase labour productivity -reduce variable cost -reduce fixed costs in long term -increase/maximise capacity utilisation -QC/QA -lean prodcution |
| Porter's Generic Strategies: (Differentiation) | -quality of product -branding/usp/image (marketing mix) -innovative |
| Porter's Generic Strategies: (Cost Focus) | -understanding the needs/wants of their specific market (research) |
| Porter's Generic Strategies: (Differentiation Focus) | -focus on product, place and people (expertise/knowledge making it hard for competitors to enter the market/substitute products) e.g. Tiffany, Ferrari |
| Bowman's Strategic Clock: | a model presenting 8 strategic options in terms of price and perceived value of customers |
| Bowman's Strategic Clock: (Differentiation Strategies) | -4&5 (12-2 0'clock) differentiation (4) = may not necessarily charge premium price but ideal to increase profit margins -focused (5) = premium prices for very high quality e.g. Sunseeker yachts more likely to be niche markets |
| Bowman's Strategic Clock: (Non-competitive strategies) | -6, 7, 8 (2-7 O'clock) -a basic product with premium price is unlikely to attract sales so customers will switch brands unless the product is in a monopoly market (sole seller of goods with no competitors) |
| Bowman's Strategic Clock: (Low-price strategies) | -1 & 2 (7-9 O'clock) -selling at a lower price than perceived value -very low profit margins but very high volume and low customer loyalty (not usually an ideal strategy but firms that lack USP and cater for low income/price sensitive consumers (inferior goods) can be very successful e.g. Poundland, Ryanair) |
| Bowman's Strategic Clock: (Hybrid strategies) | -3 (9-12 O'clock) -usually short-term to boost sales/create awareness (often when entering new markets) -prices are lower than perceived value to attract interest and sales |
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