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Process of positioning the products or services a business intends to provide to the market.
Can identify a gap in the market or reposition a product.
Construct a diagram of where competitors are on two axes to find a gap.
A feature that gives a business an advantage over competitors.
Achieved by using resources to achieve cost or differentiation advantages.
Porter's strategy: be lowest cost or highest differentiated, not in the middle.
Distinguishing a product/service from competitors.
Achieved through unique features or marketing.
Allows for brand loyalty and a premium price.
Difference between price charged and cost of production.
Achieved by improving the product/service or how it is perceived.
Benefits: higher price, protection against low prices, customer loyalty.
Cost Advantage: same quality at a lower price (ASDA, Ryanair).
Differentiation Advantage: superior product through design, research, branding (Dyson, Apple, Waitrose).
Design: improving on design features to make a product unique.
Production: improving quality and efficiency.
Marketing: creating an image that makes the product more desirable.
Lowest Cost: offering a product/service at the lowest cost.
Differentiation: offering a product/service that stands out from the competition.
Gains brand loyalty and allows for a premium price.
Lowers PED and makes it more inelastic to increase prices.
