GEB4890 Chapter 5

Competitive Strategy

Management's plan for achieving market advantage.

Broad Low-Cost Strategy

Lowering overall costs to attract many buyers.

Broad Differentiation Strategy

Differentiating products to appeal to a wide audience.

Focused Low-Cost Strategy

Targeting a niche market with lower costs.

Focused Differentiation Strategy

Customizing products for a specific niche market.

Best-Cost Strategy

Combining upscale features with lower costs.

Cost Advantage

Achieving lower costs than competitors.

Value Chain System Activities

Overall system processes affecting cost efficiency.

Cost Drivers

Factors significantly influencing a company's costs.

Economies of Scale

Cost advantages from increased production volume.

Bargaining Power

Negotiating advantages with suppliers to reduce costs.

Vertical Integration

Controlling supply chain stages to reduce costs.

Price Competition

Intense rivalry focused on underpricing competitors.

Product Differentiation

Creating unique product features valued by buyers.

Price Sensitivity

Buyers' responsiveness to price changes.

Low-Cost Strategy

Achieving competitive advantage through lower prices.

Broad Differentiation Strategy

Appealing to diverse buyer preferences with unique offerings.

Value Drivers

Factors enhancing product differentiation and appeal.

Value Chain System

Coordinating activities to enhance customer value.

Downstream Coordination

Working with channels to improve customer satisfaction.

Tangible Features

Physical attributes enhancing product satisfaction.

Differentiation-based competitive advantage

Gaining edge through unique product features.

Intangible features

Non-economic attributes enhancing buyer satisfaction.

Unique competencies

Distinct skills that enhance product value delivery.

Sustainable competitive edge

Long-lasting advantage difficult for rivals to match.

Overspending on differentiation

Excessive costs reducing overall profitability.

Trivial improvements

Minor enhancements that do not significantly add value.

Over-differentiation

Exceeding buyer needs with excessive product features.

Price premium

Higher cost charged for perceived product superiority.

Target segment

Specific market group a company aims to serve.

Focused low-cost strategy

Lower pricing for a narrow market segment.

Broad low-cost strategy

Lower pricing for a wide buyer group.

Focused differentiation strategy

Tailored offerings for a specific buyer group.

Buyer segment existence

Presence of consumers seeking unique product attributes.

Product offering uniqueness

Distinctive features setting a product apart from rivals.

Customer relations

Trust and rapport built with buyers.

Company reputation

Public perception influencing buyer trust and satisfaction.

Focused Strategy

Targets competitive edge through low costs or differentiation.

Target Market Niche

A specific segment with profitability and growth potential.

Industry Leaders

Major competitors not targeting specific market niches.

Multisegment Competitors

Firms serving multiple market segments simultaneously.

Niche Specialization

Focusing on unique needs of a specific market segment.

Segment Overcrowding

High competition within a specific market niche.

Focused Low-Cost Strategy

Low-cost approach tailored to niche market needs.

Focused Differentiation Strategy

Unique product attributes aimed at niche buyers.

Best-Cost Strategy

Combines low-cost and upscale attributes effectively.

Value-Conscious Buyers

Consumers seeking quality at reasonable prices.

Hybrid Strategy

Integrates elements of both low-cost and differentiation.

Product Differentiation

Creating distinct product features to attract consumers.

Competitive Vulnerability

Risk of being squeezed by low and high-end competitors.

Customer Value Proposition

Promise of better value to justify higher prices.

Internal Situation Matching

Aligning strategy with company resources and capabilities.

Sustaining Competitive Edge

Maintaining advantages through unique resources.

Cost Advantage

Lower operational costs compared to competitors.

Perceived Value

Consumer's view of a product's worth.

Midrange Products

Products positioned between low and high-end offerings.

Upscale Attributes

High-quality features enhancing product appeal.

Market Segmentation

Dividing a market into distinct groups of buyers.

Competitive Strategy

Plan to outperform rivals in the market.

Generic Strategies

Basic approaches to gain competitive advantage.