Question

Nendry is the owner of a firm that produces sports drinks. Since there are a number of firms in the industry competing on cost, Nendry has decided to pursue a differentiation strategy. In this case, she should:_______.
A. Concentrate on improving process technologies to achieve economies of scale.
B. Enforce a strict budget controls at all levels of the organization.
C. Devote all resources to reducing the value gap.
D. Focus on adding unique features to her product that customers will value.

Answer 1

Answer:

D. focus on adding unique features to her product that customers will value.

Explanation:

Differentiation strategy is the strategy that aims to distinguish a product or service, from other similar products, offered by the competitors in the market. It focuses on the development of a product or service, that is unique for the customers, in terms of product design, features, brand image, quality, or customer service.  

The focus of competition in a differentiation strategy tends to be on unique product features, service, and new product launches, or on marketing and promotion rather than price. A differentiator would focus research and development on product features or packaging in order to add uniqueness.

Hence, Nendry should focus on adding unique features to her product that customers will value.