¶ … IKEA case study by mapping the facts to the two famous concepts known in marketing, the Porter's generic strategies and the Strategy Clock.
Difference in purpose and application of Porter's generic strategies and the Strategy Clock
Michael Porter, generally known as the king of marketing developed a scheme in which he devised three strategies that companies usually undertake or should undertake in order to maintain or achieve their competitive advantage. The model can be best summarized in the figure below.
Porter's Generic Strategies (Wikipedia, 2012).
If we carefully analyze the model above, on x-axis we will see strategies being devised on type of competency that they have and on y-axis we will see strategies being devised on the level of scope that the company is operating in (Porter, 1998). As the case facts suggest, IKEA had a broad market scope and had a low cost competency. Thus, the strategy for IKEA is Cost Leadership broadly. However, case facts also suggest that IKEA was customizing its products in some regions based on customer preferences. The market scope for those regions changes to narrow while the competency remains the same. Thus the strategy for those regions will be segmentation strategy.
It is important to note here that Porter's model is identifying the strategy that the company is using or should use based on its competency and market scope (Porter 1998).
Cliff Bowman provides us with another tool for analyzing the competitive position of the company in comparison with the competitors. While Porter's model also serves the same purpose, Bowman's model is detailed and offer enhanced information about the strategies. The model can be best summarized in the figure below:
Figure 1.2: Bowman's Strategy Clock (Marketing Teacher, 2010).
In Bowman's model, the competitive position is analyzed by the perceived added value (Marketing Teacher, 2010). It is important to understand that Bowman's model analyzes the company by its...
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