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Two generic strategies? Differentiation or cost leadership?

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There are only two generic strategies available to a firm: differentiation or cost leadership. Both strategies can be applied either into a focused market or a broad market. Do you agree that these are the only two strategies available? Are they mutually exclusive? Why or why not?

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Yes, these are the two core features. These strategies represent two ends or extremes. You can either try to drive the cost down relentlessly (cost leadership) or you can innovate and offer something that others don't (differentiate).

Since they are on a "continuum" you can lean towards one side or the other but have features of both (so they are not entirely mutually exclusive). ...

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Carol Sargent, PhD
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  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
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