Marketing strategies are important in finding a share in the market place. There are numerous products and services in the market so businesses need to focus on a strategy in order to gain a competitive advantage. There are two approaches explained below that showcase marketing strategies.
Competitive Advantage Concept 1 – Figure 2
The first concept pictured above was developed by Michael Porter (Kotler and Armstrong, 2014). Overall Cost leadership refers to a company developing low production and distribution costs. When prices are lower than competition the product gains an advantage. Differentiation refers to a company developing a strategy or image that puts them above the competition. This makes customers want to own that specific brand like Nike, because of its image in relation to competition. Focus refers to the business picking certain segments in the market to cater to. In this option the whole market is not targeted rather just specific segments so they become the most competitive in that area. It is important for a company to focus on one of these concepts instead of trying to assume all roles. When a company takes on all roles they tend to suffer because they cannot succeed in any area.
Competitive Strategies Concept 2 – Figure 3
The above image refers to another concept regarding competitive strategies. These were developed by Michael Treacy and Fred Wiersma (Kotler and Armstrong, 2012). Their approach is more customer oriented making them more appealing to customers. They believe in providing superior customer value to take lead in the market. Operational Excellence refers to setting a low cost with good quality to appeal to customers. Customer Intimacy refers to tailoring products or services to appeal to a certain segment of the market. Product leadership refers to companies creating new technology that breaks the mold. They are open to new ideas and try to gain market by always creating the next big thing.
Applied Learning
I have come across this concept in my personal work with marketing. My group’s practicum presentation was based on designing customer- driven strategies, this concept was applied in my practicum presentation (see presentation in my applied work page). When dealing with customers you have to focus on what they want. We chose to talk about the Microsoft surface tablet. It used differentiation as it’s competitive strategy. By adding a USB port, as well as supplying office suite, the Surface took a lead in the market by gaining competitive advantage.
Sources
Kotler, P. & Armstrong, G. (2014). Principles of Marketing. Upper Saddle River, NJ: Pearson Education, Inc.
Journey through Marketing 