The each of the following independent situations, state whether the company is f

Question

The each of the following independent situations, state whether the company is following a low cost or a differentiated product strategy and explain your answer.

a) DexPhone is about to decide whether to launch production and sale of a mobile phone with standard features.

b) Global Computers is trying to decide whether to produce and sell a new home computer software package that includes the ability to interface with a sewing machine and a vacuum cleaner. There is no such software currently on the market.

c) Phadi Pharmaceuticals has been asked to provide a ‘store brand’ roll on sunscreen that will be sold at discount retail stores.

d) Morelle Deli is entertaining the idea of developing a special line of gourmet pasta sauce made with sundried tomatoes, mushrooms and truffle oil.

Explanation / Answer

a) DexPhone has not decided yet about the production and launch of a mobile phone . So there is no question of following the low cost or differentiated product strategy.

b) Global Computers decided to launch software package which is different from other competitors in market. So company is definately following a differentiated product strategy.

c)Phadi Pharmaceticals has been asked to provide 'store brand' on sunscreen which is a promotional way of selling product.So there is no question of low cost strategy, but it can be differentiated strategy , if no other competitior has followed it .

d) Morelle Deli is entertaining a new idea of developing a special line of gourmet pasta sauce which is definately a differentiated strategy followed by company.

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