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Porters Generic Competitive Strategies Marketing Essay

Paper Type: Free Essay Subject: Marketing
Wordcount: 841 words Published: 1st Jan 2015

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Apart from that, Porter’s generic competitive strategies can be used by the organization that could use to develop and maintain competitive advantage in the market, such as cost leadership strategy and focus strategy. Cost leadership strategy which is the company tries to achieve lowest cost of production and distribution. Focus strategy which is paying attention to a few market segments.

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There are two organizations that using different strategies to running their business. A company which is AirAsia, it is running its business by using cost leadership strategy and also by using information system strategy, Air Asia can strengthen their position as a leading low cost airline and getting more advantages with their motto “Now Everyone Can Fly.” Air Asia which airline company that entered a formerly hurting market with great success, such as ticketless travel, automation with IT, reduced costs, and improved service. Air Asia builds and sustains its competitive advantage and strategy advantage, which is using strategy to maximize company strengths to beat its rivals by providing services at a price that is simply lower than competitors’ price. For example, Air Asia is using Web will be an advantage where the sale can be extended to the entire world as its market. Competitive advantage is achieved when a profit company increases its profit by reducing costs and increasing revenue. There are some reasons that make Air Asia becoming a low-cost producer of airlines industry, such as ticketless, information send through online where do not need physical sales counter, and do not need for customer services. Customers do all the process such as checking, reserve, buying or even changing the date of flight.

Moreover, Air Asia is also using differentiation strategy to developing ways to differentiate a company’s products and services from its competitors’ or reduces the differentiation advantages of competitors. Air Asia is using E-commerce strategy that different with other airlines companies. For example, E-ticketing or online booking was the issue of a booking code at the conclusion online transactions that replaced the traditional airline ticket. There is also innovative, Air Asia is finding a new way in application of Information Technology in airlines business by becoming the first budget airline company with practiced Business to Commerce (B2C) transaction in the airline industry in Asia. While, customers can even now check and book air ticket by using mobile phone. In the other hand, alliance is establishing new business linkages and alliances with customers, suppliers, competitors, consultants, and other companies. Air Asia alliance with many hotels in the world in order to provide travel packages to their customers.

There is another organization using cost-focus strategy which is Starbuck. The products cater for a particular segment of consumers, which sell at considerably cheap but premium, in the perception of consumers. It can be celled niche market. There is having bargaining power for the organization, which means leverage to influence buyers and suppliers. For example, achieved by being major competitor or eliminating competitors, or uses purchase volume that has the biggest purchase amount as leverage over suppliers.

Furthermore, Starbucks will be examining for demographics, it will target the people ages 15-64 make up the largest percentage of the population. In addition to waste reduction, Starbucks also aims to reduce energy usage and once again, demonstrates this by doing energy audits and then using the results to change store design or procedures so that they save as much energy as possible. Starbucks also has upstream supply chain management expertise in resources high quality raw ingredients, which means it is monitoring, controlling, and facilitating supply chains. The aims of supply chain management are to reduce manufacturing costs, resources costs and to properly control the inventory.

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Moreover, the product will be critical for the taste and convenience. The packaging should be highlight the innovative micro-ground process and the sizing should be easier to tear stick sachet with multi-pack sized for travel. In the other hand, there is no direct merchandising or distribution experience outside of the retail outlet within Starbucks Malaysia. The major shareholder should be able to leverage on its extensive businesses experience elsewhere within the food and beverage sector to make headway into new distribution channels. The prices strategy is a clearly price skimming with an emphasis on setting a price that is high enough and high quality as well. A pricing strategy that offers rewards for loyal Starbucks customers would work well for the relationship between the instant coffee and retail brew sector such as customer relationship management, which to better understand what customers want, to be able to collect payment sooner and to ensure timely shipping.

 

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