The company vows to plant 10 trees for every purchase made. A very common and probably a global example of the focus strategy is “diet coke” by the coca-cola company. In this article, we will discuss what a business strategy is and why it's important, the components of a business strategy and 10 examples of business strategies to help you generate ideas for your own company. AARP is the preeminent leader in advocacy for the 50+ age group. Within the realms of the business world, pre-20th-century theories of competitive strategy focused on binary outcomes; mainly how to bludgeon markets with monopolies and exclusivity agreements. It is typically implemented when the agency involved already knows its targeted demographics and can meet the needs of each consumer effectively. Proctor and Gamble’s headquarters is in Cincinnati, Ohio. Motel 6 has sustained competitive advantage for over 50 years by focusing on budget-conscious consumers. A product strategy is made up of multiple components. The idea behind focus strategy is developing, marketing and selling products or services to a niche market, such as a particular type of consumer, a specific product line or a targeted geographical area. During this campaign, Motel 6 has grown from 200 to over 1,000 locations across the U.S. and Canada. In marketing, this means knowing the crowd you want to target and finding a way to make your product what they feel they want or need. He is a harmonizer in group settings, cultivating unity while constructing the overall goal and strategy. Ten Tree is an apparel company that strives to commit: stewardship, transparency, and community involvement. Companies that compete by following cost leadership strategies to serve narrow market niches generally target the smallest buyers in an industry (those who purchase in such small quantities that industry-wide competitors cannot serve them at the same low cost). Focused cost leadership is the first of two focus strategies. Frog Box is a moving company that provides a cost effective and environmentally friendly alternative to using cardboard boxes for moving. Novo Nordisk, AARP, and Motel 6 are examples of companies and organizations that have sustained competitive advantage with a focus strategy. This is because it requires a high investment to achieve economies of scale. Example: Second-Tier Objectives and Strategies for Company Alpha. With focus strategy, a company chooses a small segment of the industry to focus its marketing efforts on. A good strategic framework provides focus by limiting the number of directions the organization runs. 23 focus strategies essay examples from academic writing company EliteEssayWriters™. Focus is a strategy that enables a company to dominate a niche. Focus strategy provides the option to use cost leadership or differentiation within the niche market. Companies that succeed with a focus strategy understand the dynamics and unique customer needs of their market niche. A cost focus strategy is same as a cost leadership strategy, but the major difference is that in a cost focus strategy your organization pic out a very specific part of the market and discount that market the affordable prices, available in the market. a long-term action plan of a company which is directed to gain competitive advantage over its rivals after evaluating their strengths By creating, marketing, and selling a product or service intended for a niche market, then it becomes possible to become the recognized expert in that market better than those promoting a generalized strategy instead. Such companies include: TOMS, Frog Box, and Ten Tree Apparel. Strategy is all about planning done for the next day or future and is expected to get the best results out of the strategy, it is important for us to cope up for the uncertain tomorr… Use the tips and examples in this post, as well as the techniques in our niche marketing pdf, to help you develop a strategy for identifying an underserved and valuable customer segment you can focus on. A student’s visual focus and attention can dart around the room due to the many distractions. A great example of that is Toyota. You are able to advertise and promote your products and services in media that focuses on your target group. PORTER’S GENERIC STRATEGIES 2. Examples of Focus Strategy Diet Coke-Coca Cola. In summary, the three strategies your company can choose from to sustain a competitive advantage include: Cost Leadership involves a company that is able to produce and sell its products and services at a much lower cost than its competitors. You can also decide on the best types of product and service solutions to sell to this niche. Differentiation focus strategy combines the advantages of both strategies; the company appears unique to its potential consumers in an already-narrow market with little competition. Focus strategies can be based either on cost leadership or differentiation. This enables a low cost leader to earn above average profits. They wanted solutions to their problems. Creating a business strategy that's in line with the vision you have for your company takes time and development. This strategy is quite a resemblance to the cost leadership strategy; however, a major difference is that the cost focus strategy businesses target a particular segment within the market and that segment is offered the lowest price of the product or service. A product focus definition could be an approach to business that defines a company's operations, strategies, metrics and performance in terms of products. Your email address will not be published. Focus strategy provides the option to use cost leadership or differentiation within the niche market. The scope must emphasize where the business’ direction and focus will not go. It lost its focus and was not successful in the new market. Lexus is positioned for a group of rich people. The former search engine leader, whose focus was on Internet search, lost its dominance when it expanded into other online services. These shirts retail for more than $100. Yet, it can be expensive to be a dominant leader in your industry through differentiation. However, they have their account managers located in Bentonville, Arkansas so they can be near Walmart, their leading retail customer. As markets became more liberated, compromises and specializations became more important and up to the mid-20th-century teachings moved towards gaining internal proficiencywithin business analysis. Are you more likely to visit a big superstore with a variety of options to choose from, or a small retailer with not only very specific product options, bu… This way you can get the most from your limited resources, including money, time, and staff.