CS Professional · Strategic Management and Corporate Finance · Competitive Positioning
A company in Coimbatore makes pumps for all types of farmers across India, but a competitor decides to make only solar-powered pumps for small farmers in drought-prone districts, offering specialised features and service. Which generic strategy is the competitor following?
The competitor follows a differentiation focus strategy. It serves a narrow segment, small farmers in drought-prone districts, and competes through specialised solar-pump features and service rather than the lowest cost or a broad market offering.
- ADifferentiation focusCorrect
- BCost leadership
- CBroad differentiation
- DStuck in the middle
Explanation
The competitor chooses a narrow target segment (small farmers in drought-prone areas) and competes through specialised features and service, which is differentiation focus. Cost leadership and broad differentiation both need a broad market. Stuck in the middle means no clear strategy, which is not the case here.
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