AQA A Level Business - Unit 8

Strategy

the specific long term plan to meet your aims

Market

where you are selling your goods or services

Dynamic markets

market with changing internal and external factors

Ansoff's matrix

analysis considering different strategic directions

Market penetration

existing products and existing markets

Product development

new products and existing markets

Market development

existing products and new market

Diversification

new products and new markets

Ansoff's and risk

least is market penetration, then market development, then product development, then diversification

Coca Cola market penetration

through adapting promotion with the Christmas adverts

Coca cola product development

cherry coke

Coca cola market development

diet coke for women, coke zero for men

Coca cola diversification

related with Vitamin water, unrelated with pens

Strategy factors to consider

risk, shareholder support, impact on existing brand, employee reaction, existing strengths, investment needed, likely profit, opportunity cost

Strategy positioning

how the business is perceived by customers compared to similar businesses

Porter's generic strategies

considers strategic advantage and strategic target

Cost leadership

low cost and broad target like Primark or Easyjet

Differentiation

Differentiation and broad market like Apple

Cost focus

low cost and narrow market like a local discount retailer

Differentiation focus

differentiation and narrow target like Ferrari

Success firms

highly distinctive products offering a clear strategic position

Stuck in the middle

porter believes these do not have a clear strategy

Bowman's strategic clock

considers strategic options based on varying levels of price and perceived value

Bowman differentiation

charge premium price

Bowman focused differentiation

for very high quality products aimed at consumers with high incomes

Bowman non-competitive

basic product with high price is unlikely to attract sales

Bowman low price

selling at a lower price than perceived value

Bowman hybrid

usually short term strategies to boost sales or create awareness

Influences on Bowman

previous strategy, brand image, consumer perception, stage of life cycle, rival's strategy, external environment

Strategic direction

Refers to a course of action or plan that is is hoped will lead to the achievement of long term goals.

Cost benefit analysis

A process where business decisions can be analysed. Costs are subtracted from the benefits to reach a decision.

_____________________ is considered the most risky strategy but should not be dismissed as it can be hugely successful.

Diversification.

The STP process stands for

Segmentation, Targeting and Positioning

All strategies have some degree of _________ which varies according to the circumstances of the business.

Risk

Porters generic strategies is a good starting point. Once a strategy has been decided there are a number of further options and __________ enables these options to be looked at in more detail.

Bowman's strategic clock

The benefits to having a competitive advantage are :

Sales, Brand loyalty, Profit and Shareholder value

Positioning strategies can be linked to ____________ ________ because they identify a gap in the market.

Market mapping