Total Rewards Discussions - Discussion 1 Identify two companies one that you believe pursues a lowest-cost strategy and another that pursues a

Total Rewards Discussions - Discussion 1 Identify two...

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Discussion 1 Identify two companies, one that you believe pursues a lowest-cost strategy and another that pursues a differentiation strategy. Relying on personal knowledge or articles in newspapers or business periodicals, discuss these companies’ competitive strategies. I think the go to strategy for low cost is Walmart. In the past 10 years they have gone from being the deal makers, to everyday low prices. Now they are located in every major city in the U.S. and have even turned most from shopping stores to supercenters with the addition of groceries. It is many american's go-to place for purchasing common house hold items. Not only do they have a strong brick and mortar presence, they incorporated online orders into customers lives. They have same day in-store pick up along with free shipping to the store. They are the low cost KINGS. But they maintain this low cost by paying their employees little more the minimum wage and have been targeted for offering only part-time hours to lower level employees so they do not have to contribute to health insurance premiums. An organization that uses differentiation strategy would be Apple. They have been known for their innovative technology over the last decade with the invention of the iphone, ipod, mac, ipad and all things apple. Customers are will to pay the outrageous prices for their products because they have created a superior product. Macs are know for being virus free, they were the top pick for schools years ago when computer viruses and the Internet were still green in public places. While they are still known for this, they are more of a sign of wealth in my opinion, customers drop thousands on a laptop or desktop that will be outdated in a matter of months because of the increase in development of technology. Apple absolutely uses differentiation strategy by producing a quality product that is typically months or even years ahead of their competitors. I chose to compare two furniture retailers, IKEA and Ethan Allen, who employ lowest- cost and differentiated strategies respectively. Both companies enjoy high places in their target markets, but appeal to different consumers. IKEA IKEA's statement, "You do your part. We do our part. Together we save money.", is a perfect reflection of their lowest-cost DIY strategy. Consider this scenario: a college student walks into an IKEA store with his parents to buy inexpensive, but "cool" furniture of acceptable quality. Of course first they had to park the U-Haul they rented to haul away the unassembled furniture they'll check out from IKEA's enormous warehouse because IKEA neither delivers nor provides assembly. They'll follow IKEA's floor arrows through the store's room-themed sections to get their own ideas about decorating and piece use and will likely not interact with an employee until they check out since IKEA does not employ traditional sales people or designers. They'll pick pieces that meet their needs for functional, stylish, acceptable quality furniture at a low price. The furniture can be used and abused and abandoned when its job is done.
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  • Spring '19
  • Business, Temporary work, Ethan Allen

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