3.1.2 corporate stratergy Flashcards
What 4 strategies does the ansoff matrix reveal that a business may adopt?
- level of investment in existing and new products
- exploitation of different markets
growth strategy of the business - level of risk that the business is willing to accept
What is market penetration?
ansoff matrix
selling existing products into existing markets, seeks to achieve 4 main objectives
- maintain or increase market share of current products
- secure dominance go growth markets
- restructure a mature market by driving out competitors
- increasing usage by existing customers
What Is market development?
ansoff matrix
selling existing products into new markets, ways of approaching the stratergy
- new geographical market
- new distribution channel
- different pricing strategies to attract different customers
What is product development?
ansoff matrix
new products into existing markets- places the emphasis on
- research, development and innovation
- detailed insights into customer needs
- being first to Market
What is diversification?
Ansoff Matrix
new products into new markets
- riskiest stratergy as the business has no experience in the market
- the balance between risk and reward can be highly rewarding
What are the limitations of the ansoff matrix?
- only a limited picture
- doesn’t take other factors into account
- very simplistic
- swot and pestle analysis needed
What is a competitive advantage?
A way that a business performs that allows them to be better than its competitors such as a justified high price
What are examples of a competitive advantage?
- celebrity endorsements
- USP
- Affordability
- Size of products
- Product range
- Geographic
What is powers strategic mix?
A strategic tool that identifies sources of competitive advantage a business may achieve in a business
What is differentiation?
porters strategic mix
involves a business operating in a mass market nut adopting an unique position instead of the lowest cost position
what is cost focus?
porters strategic mix
a business seeks a lower cost advantage in just one or a small number of market segments
- basic productions to emphasises minimised costs
What is differentiation focus?
porters strategic mix
pursuing different strategies within a target market segement
- must be able to meet the needs of the segement
What are ways to differentiate?
porters strategic mix
- offering superior product quality
- branding
- industry wide distribution across all major channels
- consistent promotional suport
What is cost leadership?
porters strategic mix
The objective of cost leadership is to become the lowest cost provider in the industry
- involved production on a large scale which allows businesses ro exploit economies of scale
