Why would you choose Broad Differentiation Strategy to competing successfully and making profit in your own...

Why would you choose Broad Differentiation Strategy to competing successfully and making profit in your own company? Explain shortcomings (pitfalls) to avoid.

Expert Solution

Why companies choose broad differentiation strategy ?

Broad differentiation strategy is adopted by a company, to be unique to a wide range of customers. in this case, a large number of customers is the focus and those customers consider the differentiation valuable to them.

Broad differentiation strategy provides ways to differentiate their product from rivals , which will lead to company's suuccess . They are

Differences in quality.
Innovation.
Responsiveness to customers.
Responding to customers’ psychological desires.
Wide choice of customers.
Reliability of products.
Availability of spare parts/peripherals/accessories.

Short comings to avoid -

Sustainability of differentiation strategy is an important issue for a company.

If product differentiation cannot be sustained the company may incur huge losses This necessitates the confusing of a consumer survey to determine the needs and preferences of buyers.

Based on the survey results, the company should undertake initiatives to incorporate unique attributes in its products.

The company must try to adopt those differentiation approaches that would be hard or expensive for the competitors to copy

Differentiation has to be linked to core competencies, unique competitive capabilities, and superior management of value chain activities.

Differentiation attributes must be of value to customers. A particular differentiating attribute may seem to the company very valuable and appealing, but if it is viewed by customers as having no or little value, the differentiation strategy will never sustain.

Success depends on careful analysis of buyers’ needs and their perceptions.

It is quite natural that consumers will be interested only in such new product attribute that will give them value.

If the firm fails to consider the consumer’s perspective in terms of the value of the attribute, its differentiation strategy is bound to fail.

keosha answered 1 month ago

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