Answer to Question #243797 in Management for dido

Question

Generic strategy is a combination of competitive strategy and competitive scope in Broad and Narrow segments. Discuss when a company should employ a STUCK IN THE MIDDLE STRATEGY

Answer 1

A business is considered to be caught in the middle if it lacks distinctive characteristics that entice consumers to purchase its products and its prices are too high to compete successfully on price. Businesses that are caught in the center often do badly due to a lack of a defined market or competitive pricing. The no-frills operators have chosen to keep expenses low and pass on savings to consumers via reduced pricing. This enables them to capture market share and fill their aircraft to capacity, further lowering costs. On the other side, luxury airlines concentrate their efforts on providing the best possible service, and the higher rates they can demand compensation for their higher expenses. Simply being one of the lowest-cost manufacturers is insufficient, since it leaves you vulnerable to assault by other low-cost producers who may undercut your pricing and so stymie your efforts to gain market share. Large companies that are pursuing a differentiation strategy must maintain an agile approach to new product development. Otherwise, companies run the danger of being attacked on many fronts by rivals adopting Focus Differentiation tactics across multiple market categories.