Question

Classifying Some Year 2009 Strategies Purpose This exercise can improve your understanding of various strategies by giving you experience classifying strategies. This skill will help you use the strategy-formulation tools presented later. Consider the following 8 actual year-2009 strategies by various firms:

1. Microsoft developed a new videocamera for its Xbox 360 console that allowed players to control games with the movement of their bodies, rather than by holding a plastic wand in their hands, as required with Nintendo’s popular Wii game console.

2. Wells Fargo and Bank of America began to “tweet”—post messages of 140 characters or less on Twitter.com, so customers could see product features. Banks are also putting marketing videos on YouTube.

3. The United Kingdom’s huge telecom firm, BT Group PLC, cut 15,000 more jobs on top of the 15,000 the prior year.

4. Japanese electronics maker Panasonic Corp. acquired Osaka, Japan-based Sanyo Electric Company.

5. News Corp. sold off many of its television stations.

6. More than 1,000 Chrysler dealers closed their doors and ceased doing business.

7. Germany’s Metro AG, the world’s fourth-largest retailer after Wal-Mart, Carrefour SA, and Home Depot, is expanding aggressively into China.

8. Time Warner plans to spin off or sell all or part of AOL.

Instructions

Step 1 On a separate sheet of paper, number from 1 to 8. These numbers correspond to the strategies described.

Step 2 What type of strategy best describes the 8 actions cited? Indicate your answers

Answer 1

Answer:

Given the 8 actual year-2009 strategies by various firms:

1. Microsoft developed a new video camera for its Xbox 360 console that allowed players to control games with the movement of their bodies, rather than by holding a plastic wand in their hands, as required with Nintendo’s popular Wii game console.

This is best described by Product Differentiation Strategy.

2. Wells Fargo and Bank of America began to “tweet”—post messages of 140 characters or less on Twitter.com, so customers could see product features. Banks are also putting marketing videos on YouTube.

This is best described by Finding New Markets for Products

3. The United Kingdom’s huge telecom firm, BT Group PLC, cut 15,000 more jobs on top of the 15,000 the prior year.

Loss recovery strategy

4. Japanese electronics maker Panasonic Corp. acquired Osaka, Japan-based Sanyo Electric Company.

Acquisition Strategy to Gain Competitive Advantage

5. News Corp. sold off many of its television stations.

Loss recovery strategy

6. More than 1,000 Chrysler dealers closed their doors and ceased doing business.

7. Germany’s Metro AG, the world’s fourth-largest retailer after WalMart, Carrefour SA, and Home Depot, is expanding aggressively into China.

Finding New Markets for Products

8. Time Warner plans to spin off or sell all or part of AOL.

Cost cutting strategy