1. Dell uses cost leadership and differentiation as its business strategies to compete against competitors thus increase its profitability. Dell applied its cost leadership strategy in its business model. Dell sells all of its products both to end-use consumers and to corporate customers, using a direct-sales model which Dell uses the internet and the telephone network thus cutting its operation cost. Also Dell uses just in time inventory management meaning Dell will build computers only after customers place orders and by requesting materials from suppliers as needed. As a result, Dell can avoid overproduction and save on its inventory charge. In addition, Dell was able to provide customizable systems at an affordable rate by using the internet in which Dell differentiate itself from other competitors by building a specific and customize computers for each customer.
2. Bloomingdale department store applied its focus toward middle and upper class customer group as its business strategies to compete against competitors. Bloomingdale sells designer clothing which its target customer group is middle toward upper class people or simply meaning rich individuals. Bloomingdale merchandises are much more luxurious and expensive compared to similar department store like Macy’s. As a result, Bloomingdale was able to differentiate itself as being an exclusive department store that sells exclusive designer clothing.
7 comments:
That's a good point with Dell and their cost leadership. They were one of the first companies to really utilize the low cost ideas, at least in the tech sector, since they didn't build the computer until the customer ordered.
I think a lot of computer companies followed their model after they became so successful.
Great post, I was just wondering how does K-mart show focus to an average individual? Do they do anything specifically to display this?
Well, K-mark focused on discount price which in turn targeting not upper or middle class individual but to average or below middle class individual.
Hello Hyle,
I think that your example about Bloomingdales is very interesting because they have established a clear advantage over its rivals by only targeting the markets that you mentioned. People with high income know that this is the department store for them because they can find all that they need within the store.
I think Product differentiation is refer to how a company let its product stand out or different from other company in terms of product design, function, or package. The example you give and the way you explain seem more like "focus" business stragegy too me.
I was going to use Bloomingdale as well either for differentiation or focus because blommingdales focuses on middle to upper class individuals and then they also differentiate themselves by competeing on higher quality and higher prices.
I was going to use Bloomingdale as well either for differentiation or focus because blommingdales focuses on middle to upper class individuals and then they also differentiate themselves by competeing on higher quality and higher prices.
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