CFA Level I · CFA Level I Exam · Industry and Competitive Analysis
A small software firm serves only dental clinics with specialized scheduling tools and charges higher prices than general software vendors. This strategy is best described as a:
The strategy is best described as focused differentiation. The firm targets a narrow customer segment, dental clinics, with specialized features and charges higher prices, whereas broad strategies, whether cost leadership or differentiation, aim at the whole market rather than a single niche.
- Afocused differentiation strategyCorrect
- Bbroad cost leadership strategy
- Cbroad differentiation strategy
Explanation
The firm serves a narrow segment (dental clinics) with specialized features and premium prices, which is a focus strategy based on differentiation. Broad strategies target the whole market, which does not fit a single customer niche.
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