University:
California State University, Northridge
Course:
MKT 442 | Business to Business Marketing
Academic year:

2024
Views:

175

Pages:

11
Author:

guziec685

The Strategic Gestalt STRATEGY S F FIRM E ENVIRONMENT or MARKET 1 Strategic Gestalt: Differentiation S F FIRM Differentiation STRATEGY E ENVIRONMENT or MARKET 2 Differentiation Strategy • It is: selling products or firm attributes that have unique value for the customer – Above average returns come from • charging a premium price for desired products and/or product features • selling more at the same price • dampening cyclical downturns • For the firm, it means: Working to obtain a customer-valued difference relative to the competition 3 Generic Strategies & the Concept of Proximity (Parity) • Cost Leader firms compete with Differentiators & vice-versa. • There is a limit to how much extra consumers will pay for valued features, or how many features they will give up to pay less. • Hence concept of promimity/parity or closeness. 4 Proximity (Parity) Generic Strategy Type of Proximity Cost Leadership Feature Differentiation Cost 5 Differentiation Strategy: Important Issue • Differentiation is poorly specified, “all other.” – Very general description – Cost Leadership could be form of differentiation – Doesn’t distinguish among different types of “differentiation” • Remedy: ALWAYS specify what kind of differentiation strategy: – Company is seeking CA based on what? – Examples: • Coca-Cola based on image, association with energy, fun • Ford: Quality is Job 1 (but is it?) • Marlboro: lifestyle, personal qualities 6 Core Question: If all firms focus on differentiation to some degree, • how do I tell which ones are following a differentiation strategy? • how do I tell which ones have a differentiation competitive advantage? 7 Some Clues: what will I see? (1) • Above average returns (no CA without AAR) • Most firms seek, perceive differences – Not all differences are valued by the customer • Dominant cultural values concern product differences & customer value for those diff. – “customer-driven” firm – “customer comes first” at all levels of the org. 8 Some Clues: what will I see? (2) • Firm Actions – Investments in the value chain that increase buyer value: new products, product features, perceived differences. – Small changes in cost can have large buyer effects – Examples – Mergers to obtain new competencies, products – Quality that increases perceived differences – Other Actions • R & D investments: product emphasis • Sometimes: speed to market 9 Uniqueness Drivers • Policy changes: what activities to perform and how to perform them • Linkages: – Within value chain – Backwards or forwards in chain – Important if the way one activity is performed affects the performance of another 10 Some Examples of Policy Changes • Product features • Product performance • Intensity of activity (e.g., advertising) • Content of activity • Technology employed • • • • • Input quality Personnel procedures Personnel skill Personnel experience Information employed to control activity 11

The Strategic Gestalt

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