Facts You Didn’t Know About Businesses
September 9, 2012 | In: interesting articles
Who said that the law of the jungle does not apply to business? Whether on defense or attack, the same principles are found within a market economy. As aggressive as the jungle, the market requires constant sacrifice. But this perspective is likely to be avoided if… there are implemented one of three marketing strategies widely available in the business world.
This strategy is used when you want to introduce a more varied range of products and services, with the aim of diversifying the range of clients. The development strategy is the company change of focus, depending on the requests that came from the clients, or simple intuition of the businessman. Development strategy usually includes the following movements:
- Increasing range of products, taking into account indicators such as: size, color, material;
-Expanding the range of services available to clients;
- Increase the range of options;
-Finding new uses for the product;
-New product development;
-Constant improvement of the product.
If our businessman would be the only player on the market, this strategy would be enough. But as there is no monopoly, it comes into contact with other players that will be exercising different strategies. Depending on each situation, one may call an offensive or defensive strategy.
The Defensive Strategy
Will be implemented if there is the potential danger to lose existing clients or because of a stronger competitor or because of internal problems related bills such organization or customer provided product itself. In this context it is appropriate to appeal to a SWOT analysis. For those unfamiliar with this tool, SWOT analysis is a methodology to analyze a project or a business, its name derives from the abbreviation key points behind its creation: strengths, weaknesses, opportunities and finally risks (Threats).
Strengths and weaknesses are related to the company, its strategies and how they behave when facing the competition. Opportunities and threats are factors coming from the direction of the market environment and competition and are out of the control of the company. This analysis takes into account the organization of the company, its performance, key products and markets available policy that is appropriate to launch. When it is done correctly, it allows focusing the attention on the key business areas and draw attention to those parts that are often underused or not good enough “cut” to fit in time with the business. The final results of the SWOT analysis provides an objective view of the company and according to this, the businessman will decide if he has a real chance to be able to fulfill the plans and will be addressing in the future.
This type of strategy is used to attract new customers. When put into practice, the strategy of attack reveals the player’s strength and the ability to withstand not only the market but also the way he use it to achieve the goals. In this type of strategy we have the following categories:
- Price policy change;
- The use of new distribution channels;
- Finding new outlets;
- Getting into new industry sectors;
- Entering new geographic markets.
To juggle with its advantages, the company must have sufficient resources to allow the policy change both prices and invasion of a foreign market. If the company does not have the financial capacity and experience in the market, this approach he can kill the business and can become a free ticket to bankruptcy.