This document discusses different business level strategies that companies can pursue, including cost leadership, differentiation, focus, and integrated strategies. It defines each strategy and provides examples of how companies can implement them. Cost leadership involves offering products at lower prices than competitors. Differentiation means incorporating unique features that customers value highly. Focus strategies target specific customer segments. The integrated approach combines differentiation and low costs to appeal to a wide customer base. The document outlines benefits such as higher profits, market share, and sustainability that various strategies can provide.

2.  The business level strategy refers to
strategic action taken by a company for
each of its business.
 Its aim is to gain and sustain competitive
advantage by providing value to its
customers.
Business level strategy

3.  The business level strategies are concerned
with:
Positioning the business against competitors.
Anticipating changes in demand and other
factors and adjusting to provide for them.
Influence the nature of competition through
strategic action.
Business level strategy

4.  There are four generic strategies that are used to
help organizations establish a competitive
advantage over industry rivals. That are:
 Cost leadership strategy
 Differentiation strategy
 Focus strategy
 Integration of cost leadership and differentiation
strategy.
Types of business level strategy

5.  Cost leadership strategy means offering a
product/service of the same quality at a lower
per unit price than the rival firms in a broad
target market.
 When all the firms in an industry offer the
product/service at the same price, the cost
leader earns higher profit margin than its
rivals.
1. Cost Leadership Strategy

6.  The cost leadership can be implemented
through: cost minimization in areas like
R&D, service, sales force, advertising,
etc. tight cost and overhead control,
economies of scale, modify supply
chain, etc.
How to implement?

7.  Higher profitability
 Helps to face competition.
 The firm can secure a large market share.
 Helps to keep more sustainable business
position.
 Higher capital for growth.
Benefits of cost leadership

9.  Differentiation is the business strategy of
incorporating special features into the
product/service for which customers are willing
to pay more.
 According to Philip kotler differentiation is “the
act of designing a set of meaningful
differences to distinguish the company’s
offerings from competitors offerings”
2. Differentiation strategy

10.  The product/service may contain unique
tangible features.
 Some intangible features such as firm’s
reputation or prestige may be built into the
product/service.
 The product/service may be superior quality
and its performance level is high.
How to implement?

11.  Creates a value among consumers
 Non price competition
 Build brand loyalty.
 No perceived substitute
Advantages of differentiation

12.  A focused strategy is an integrated set of actions that is designed to
produce or deliver products or services that serve the need of a
particular competitive segment.
 These competitive segments are usually identified on the basis of
demographic characteristics,geographic areas andlife style.
3. Focused business strategy

13.  There are two types of focused business strategy.
Namely:
Focused low cost strategy
Focused differentiation strategy
Focused business strategy

14.  A firm that compete based on low price and target a
narrow market are called focused low cost strategy.
 The company aims to be the cheapest supplier in this
small market but not necessarily in the overall market.
 Focused low cost strategy is better suited to small
business, because small business with limited
resources can focus their resources on a narrow
market segment.
Focused low cost strategy

15.  The firm targeting to a small group of customers with
differentiated products is called focused differentiation
strategy.
 It offers unique features of the product that fulfill the
demands of a narrow market.
Focused differentiation strategy

16.  A focused firm protected from competition.
 The customer loyalty lessens the substitute.
 Power over buyers because they cannot get the same product
elsewhere.
 New entrants find it difficult to compete with the firms that
follow a focus strategy.
Advantages of focus business
strategies

17.  Identifyinggap leftby cost leaders and differentiators.
 Buildinghighskills tofillthesegaps.
 Achieving lower cost/differentiation in comparison with
competitors for securing such small markets and making
innovations toadd valuein the valuechain.
How to implement?

18.  Integrated cost leadership/differentiation is a business level strategy
where differentiated products are offered in market at low cost.
 Differentiated product signifies the unique characteristics the
customer values and cost leadership signifies that the product is
offered at the lower cost.
 It is useful in gaining wide customer base especiallyin a global market.
4.Integration of cost leadership and
differentiation

19. Thank you
 conclusion