Question

A bank provides its customers mobile applications that significantly simplify traditional banking activities. For example, a customer can use a smartphone to take a picture of a check and electronically deposit into an account. This unique service demonstrates the bankâ s desire to practice which one of Porterâ s strategies?

Answer 1

Answer: Differentiation strategy

Explanation:

Differentiation strategy is a strategy that differentiate a product or service, from other identical products that are offered by competitors in the market. Differentiation is development of a good or service, which is unique for customers, in terms of features, product design, quality, brand image, or customer service.

Differentiation strategy is one of the three Porter’s Generic Strategy. In this strategy, firms pick one or more dimensions that are considered to be vital by the consumers thereby creating a unique image in the market.

The use of mobile banking application will ease the traditional method of banking and makes the bank standout.