Strategies to boost sales of existing products in existing markets to increase market share. Low risk as market is familiar.
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What is market development? + Risk?
Offering existing products in new markets. (For example - geographical/demographic) High risk - businesses in market may try to force new entrant out.
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What is product development? + Risk?
Developing new products for existing customers. (For example - respond to change in customer requirements.) High risk - product ideas may fail, investment in development may take time.
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What is diversification? + Risk?
Offering new products to new customer groups. High risk - product and market are unfamiliar and therefore high levels of uncertainty.
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What does a business consider when selecting a strategy?
The expected cost, expected returns, opportunity costs, the risk and the fit with the resources, impact on stakeholders and ethical issues.
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Why does strategic decision matter?
They are long term and influence decisions and targets through the organisation + provides focus.
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What is Porters strategy?
Cost leadership - achieving lower costs than rivals in industry OR Differentiation strategy - offering more benefits than rivals in the same industry.
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What are the influences on a positioning strategy?
Where the competitors are positioned, the external environment and the strengths and core competencies of the business.
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What are the ways in which a business will protect their competitive advantage?
Legal protection (laws to protect from foreign companies or patents. Control over resources - prevent others accessing. A particular culture - values and attitudes that is difficult to copy.
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What are the three main resources of sustainable competitive advantage?
1. Innovation (can protect with a patent.) 2. Architecture - relationships with suppliers and customers = good understanding. 3. Reputation - cannot be copied and adds value.
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Other cards in this set
Card 2
Front
What is market development? + Risk?
Back
Offering existing products in new markets. (For example - geographical/demographic) High risk - businesses in market may try to force new entrant out.
Card 3
Front
What is product development? + Risk?
Back
Card 4
Front
What is diversification? + Risk?
Back
Card 5
Front
What does a business consider when selecting a strategy?
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