3.8.1 Stratgic Direction: Choosing Which Markets To Compete In And What Products To Offer

Question 1

What does market penetration involve?

Answer 1

Trying to increase market share in the existing market.

Question 2

What is new product development?

Answer 2

Is selling new products in your existing market

Question 3

What is market development or extentsion?

Answer 3

Selling existing products to new markets

Question 4

What is diversification?

Answer 4

Selling new products to new markets

Question 5

What are the four areas of ansoffs matrix?

Answer 5

-Market penetration
-product development
-market development or extension
-diversification

Question 6

Describe porters genetic strategies to gain competitive advantage

Answer 6

-Cost leadership: calls for the lowest cost of production for a given level of quality

-differentiation: products with unique attributes that a consumer would value

-focus: concentrates on niche markets

Question 7

What are the four areas on porters strategic matrix?

Answer 7

-Costs leadership
-differentiation
-cost, focus
-differentiation, focus

Question 8

What is retrenchment? And how can it be done?

Answer 8

That the business will have to downsize in some areas could be done by cutting jobs, withdrawing from markets.

Question 9

What is diseconomies of scale?

Answer 9

Makes units cost increase as the scale of production increases