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warranting a premium price Option six increased price/standard Higher margins if petitors do not value follow/risk of losing market share. Option seven increased price/low values Only feasible in a monopoly situation Option eight low value/standard price Loss of market share Generic Strategies: Michael Porter (1980)Cost LeadershipThe low cost leader in any market gains petitive advantage from being able to produce at the lowest cost. Factories are built and maintained, labor is recruited and trained to deliver the lowest possible costs of production. ‘Cost advantage’ is the focus. Costs are shaved off every element of the value chain. Products tend to be ‘no frills.’Differentiation Differentiated goods and services satisfy the needs of customers through a sustainable petitive advantage. This allows panies to desensitize prices and focus on value that generates a paratively higher price and a better margin. The benefits of differentiation require producers to segment markets in order to target goods and services at specific segments, generating a higher than average price. Focus or Niche strategy The focus strategy is also known as a ‘niche’ strategy. Where an anization can afford neither a wide scope cost leadership nor a wide scope differentiation strategy, a niche strategy could be more suitable.Here an anization focuses effort and resources on a narrow, defined segment of a market. Competitive advantage is generated specifically for the niche. A niche strategy is often used by smaller firms.Focus or Niche strategyA pany could use either a cost focus or a differentiation focus. With a cost focus a firm aims at being the lowest cost producer in that niche or segment. With a differentiation focus a firm creates petitive advantage through differentiation within the niche or segment. Value Chain AnalysisCASE STUDY FRAMEWORKIntroduction (summary)SWOTI analysisGoal Alternative solutions (Strategy at macro level)Marketing environment analysis (External Internal)Redefinition of the problem GAPMotivated choice (Strategy at middle l