Competitive Strategy Analysis: Differentiation versus Cost Advantage in Starbucks, Harley-Davidson, and AirAsia
Overview
This paper analyses the competitive strategies of three major companies across different industries. It compares Starbucks and Harley-Davidson's differentiation advantage strategies with AirAsia's cost advantage strategy, arguing that differentiation provides more sustainable competitive advantage than cost leadership.
What this essay covers
- Introduction to three companies and their strategic approaches
- Analysis of cost drivers and product lifespan as competitive factors
- Comparison of differentiation advantage sustainability versus cost advantage
Preview
Three Companies
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Three Companies
Starbucks corporation exhibits a differential advantage strategy in the market. The company has been dedicated to offering the customers the best experience in the market from the time it was founded. The mission of the company has been to nurture the human spirit. It has achieved this through its coffee beaks of high, constant quality and strict managing of the chain of processes that influenced the change into the best probable espresso coffee.
Harley has also portrayed a differential strategy in the market. The firm has insisted ion providing unique Harley experience and not competing with the other manufacturers (Grant, 2016). This experience implies that the products came in unique ways that customers would prefer more than they preferred the industry rivals. Their products benefited from the low rate of depreciation than other brands.
AirAsia uses a cost advantage strategy in the market. The airline has offered the customers services at the lowest prices than the other airline companies in the market industry. The company has established its brand as the most successful low-cost airline in Asia since 2009.
One of the cost drivers that makes a company price its product different from the industry rivals is the lifespan of the product or service. This has been experienced in Harley, where the products have a longer lifespan than the others in the market.