Project Management > QUESTIONS & ANSWERS > PROJECT MANAGEMENT 510-55Assignment 3.(Chapter 5 Questions:) (All)

PROJECT MANAGEMENT 510-55Assignment 3.(Chapter 5 Questions:)

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1. Describe low-cost strategy. How does this strategy is different from differentiation and how it can relate to differentiation? Low-cost strategy is one of three marketing strategies. It is the st... rategy that company set up low price to stimulate customers’ demands and to span market share. When number of companies exist in the market, low-cost strategy is helpful to undercut rivals’ price and gain market share. For example, Walmart Inc. cut prices and gain market share within commodity market. Compare with Target superstore or K-mart, Walmart’s price is lower that both of them, and Walmart builds its own brand so that the price of commodity is lower again than any other brands. With the same or much similar quality of products, customers always prefer lower price to gain the value of the products. Thus, low-cost strategy make customer believe they gain the product value than any other higher cost products. Some companies utilize low-cost strategy to gain market share and beat other rivals in the market. Differentiation strategy is to distinguish companies’ product from their competitors by different features or quality of product. Customers could gain value from the quality or characteristics of product but not just price. Low-cost strategy is the strategy based on different cost but similar product qualities or characteristics; however, differentiation is the marketing strategy to make [Show More]

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