In business, a good strategy is just as important as the product itself. This is one of the elements that can make or break a good company, so you must be careful about that. For this reason, today we are going to have a look at a couple of types of business strategies that can inspire you for your own business.
Types of Business Strategies You Can Employ
Surprisingly, this business strategy doesn’t care that much about the price of your product or service. The main goal here is to prove that you are better than any of your competitors. Just have a look at Starbucks and Dunkin’ Donuts. The former set a higher price for its coffee than the latter. However, they did it by relying on a higher quality, as well as sustainability. Moreover, they created a brand image that helped them maintain their high prices.
2. Growth Strategy
The growth strategy relies on adding new features to products that already exist or introducing some new ones. To keep up with competitors, small companies sometimes need to up their product line. If they don’t, their customers may simply head towards the better products offered by their competitors. Just look at the cell phone companies: they are always bringing new phones, new features, and they are using new technology. If they don’t keep up, they lose.
3. Cost Leadership
This is one of the easiest types of business strategies to explain, but it’s rather hard to implement. The idea here is to offer the lowest prices for your service or product. However, a small business cannot take this approach. It’s best used by bigger ones since they can sell on a huge scale. At the same time, nobody wants to cut down on their profit margins if they happen to have fewer customers.
4. High Prices Strategy
The high prices strategy is rather the opposite of the one we analyzed before. If you decide to adopt this one, you will need to set high prices in the introductory phase of a new product. This is great if you want to recover your advertising and production costs quickly. At the same time, remember that you need to rely your high price on a special feature. What would make a customer pay that much for a new product? It could be a new feature, technology, or design, even if the product already exists.
5. A Niche Strategy
Another good idea if you don’t know what types of business strategies to choose is to go for the niche one. This means that you focus only on a small piece of the market. Even though few people have the need you’re catering to, this means you have less competition. A couple of examples of this strategy are nursing scrubs or craft beers.
These are just 5 types of business strategies that you can use as inspiration for your own business. Naturally, there are plenty others available on the market. Even so, make sure you choose the type that fits your business best, and sometimes the only way you can do that is through trial and error.
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