Question

“Competitive advantage grows fundamentally out of value a firm is able to create for its buyers that exceeds the firm's cost of creating it. Value is what customers are willing to pay, and superior value stems from offering lower prices than competitors for equivalent benefits or providing unique benefits that more than offset a higher price” Porter (1985, p.3).

  

The increasing level of competition among firms, and the extent to which customers are using the Internet to make purchases, the majority of firms have been forced to adapt their e-business strategies. How do you link Generic Strategies with e-business strategies? Choose one established e-business and elaborate the application of Generic Strategies for that particular firm.

Answer 1

Generic strategies state how a company pursues a competitive advantage across its chosen market scope.

I am learning by found that for proper incorporation of e-commerce into a business undertaking, an organization has to succeed by three levels. At the first level, the execution of e-commerce is direct at a monetary gain. The concentration of e-commerce speculation is to grow capacity or reduce manufacturing costs.

E-business like Amazon, eBay, Etsy, Fiverr, etcetera follow the following application of Generic Strategy:

Cost Leadership: A cost leadership strategy runs if the firm can manufacture its commodity at the inexpensive cost in the industry. This master plan is generally applied in trade with a product that is not decidedly different from each other.

Differentiation Strategy: A differentiation strategy needs the firm to offer commodities with the different features that buyers think is worth and are excited to pay more for them.

Cost Focus: A cost focus strategy depends on a small trade segment or a particular niche. It needs the firm to realize the traits of that trade and the different requirements of those fixed buyers.

Differentiation Focus: In this, the firm searches for different characteristics of its commodity that depend on a specific group of buyers.

Choosing a Strategy: The first stride in selecting a strategy for our firm is to do a SWOT analysis. This analysis will find the firm's strengths and weaknesses and show trade opportunities and risks.