9.1
Apple: In an interview, the CEO was asked if he was concerned that so many companies produced very similar products after Apple’s releases. His reply was, no, as it shows that we are pioneering and ahead of the rest.
Pioneering, a corporate strategy, is the process of introducing new areas of thought or development in the design process. To be successful while using this type of corporate strategy, the firm must learn more about the consumer market by extensive market research. This is recommended because the pioneering strategy is very risky due to the fact the firm is introducing a totally new, unknown, and unexpected product or service to the market. The risk of failure is considerably high because this product or service has never entered the market, thus making it is impossible to determine that the product will be a success or failure since the product/service’s lack of experience in the market.
Pioneering, a corporate strategy, is the process of introducing new areas of thought or development in the design process. To be successful while using this type of corporate strategy, the firm must learn more about the consumer market by extensive market research. This is recommended because the pioneering strategy is very risky due to the fact the firm is introducing a totally new, unknown, and unexpected product or service to the market. The risk of failure is considerably high because this product or service has never entered the market, thus making it is impossible to determine that the product will be a success or failure since the product/service’s lack of experience in the market.
Imitative
· An Imitative strategy relies on designs of other companies in creating its designs. · The imitative company also may base its accompanying product marketing strategy on the strategy of the market leader or pioneer. · Imitative strategies frequently are used in the fashion goods, furniture, entertainment, and food products industries. |
Hybrid Approaches
- Companies that use a mixture of imitative and innovative strategies in order to maximise profit, sales and results in a quick turn around, and the benefits are there will be less disruption within the company should something go wrong.
- That is hybrid strategies are an optimal solution for expanding these sales volumes.
- Innovations that are neither uniquely services nor uniquely goods.
- 'The exploitation of an idea that combines good(s) and service(s), creating more customer benefits than if the good(s) and service(s) were available separately' (Shankar, Berry and Dotzel)
- The advantage of hybrid innovations is that, as compared to goods, the number of units that must be sold before the unit price exceeds the total unit cost is decreased, while compared to services overall margins are wider thus creating a larger 'sweet spot zone'.
Market Development
The expansion of the total market served by a business, achieved by
The expansion of the total market served by a business, achieved by
- entering new segments-by expanding the geographic base of the business..
- conversion of nonusers-by lower prices or increased (or specifically designed) promotion
- increasing usage by present users-by developing and promoting new users for the product
- For example. the videotext market it in the market crystallization phase. It appears to have some market benefits, but those benefits have not been fully developed.
Product Development
- One example of how a company undertakes product development by considering the addition of variations to a product to develop a range of products building on an established brand, for example, ice cream, snack food products, chocolate products ( Kit Kat, Mars bars )
Market Penetration
- There are either proactive moves designed to identify and target changing customer requirements, or reactive moves for market defence triggered by competitive actions.
- A move by management to increase its market share help by current products in currently serviced markets.
- Market share may be increased by some combination of
- Attracting users of competitive brands
- Persuading current users to increase usage
- Attracting nonusers of the product category
For example, if there are 300 million people in a country and 65 million of those people have cell phones then the market penetration of cell phones would be approximately 22%. This would mean in theory there are still 235 million more potential customers for cell phones, which may be a good sign of growth for cell phone makers. In general, the older the offering or industry, the greater the market penetration.
Diversification
- Involves a company both in the development of new products and in the selling of those products to new companies.
- For example: A company manufacturing three-pin electrical plugs may consider producing them in a range of colours from materials of different textures and/or material properties.
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Corporate Social Responsibility
Corporate social responsibility is a form of self-regulation for a company and centres around the development of goals related to three areas: •economic •social •environmental. Companies that consider corporate social responsibility as a goal need to assess the impact of their operations in relation to these three areas in order to maximize the benefits and minimize the disadvantages. Students need to consider the ways in which a company might achieve this and the evidence of effective corporate social responsibility for a major multinational corporation. •How corporate social responsibility may be a particular goal of a company whereby the aim is to manage the economic, social and environmental impacts of their operation to maximize the benefits and minimize the disadvantages •Examples of evidence of effective corporate social responsibility for a major multinational company |
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