Focuses on improving the competitive position of the company’s or business unit’s products or services within the specific industry or market segment that the company serves .It has a double impact on the overall performance of the company do either corporate or industry effects. Porter’s Competitive strategies
Lower Cost| Differentiation|
Cost Leadership| Differentiation|
Cost Focus| Differentiation Focus|
Cost leadership : Virgin Blue reduces the cost by selling food on board ,booking by Internet or Mobile phone ,limiting the number of airport ,Low operating cost including less aircraft equipment cost by using single type of aircraft which boeing 737 ,reduce personal expenses by control its labour cost ,reduce customer service costs by developing their own reservation centers instead of commission agents ,reduce airport access fees by focusing on airports that offer competitive cost terms .It provides defense against competitor Quents and help to generates increased market share. Differentiation : It involves the creation of a product or service that is perceived throughtout its industry as unique .This speciality can be associated with design or brand image ,technology features ,a dealer network, or customer service .There is a lower customers sensitivity to price ,Increase buyer loyalty ,barrier to entry of new entrants ,can generate higher profits. Cost Focus: Virgin Blue wanted to focus on the domestic corporate market share from 10 per cent to 15 per cent in next 12-24 months. Differentiation Focus: Virgin Blue focuses not only domestic market but also on international market by strategic alliance with The British Airlines ,partnership with The Air New Zealand and The Middle East Carrier Etihad , code sharing with Emirates.
It is used to gain a competitive advantage within an industry by working with other firms. Collusion: The active cooperation of...