Question

Suppose another firm found a way to offer IKEA’s customers (young buyers interested in stylish furniture at low cost) additional sources of differentiation while charging the same price or to provide the same service with the same sources of differentiation at a lower price. What category of competitive risk to a focus strategy would this be?a.An industry-wide competitor decides that the market segment served by IKEA is worth entering.b.Focusing on a more narrowly defined segment and "outfocusing" the focuser.c.The needs of the customers in this narrow segment have become more similar to those of industry-wide competitors.d.Experience can narrow customer’s perceptions of value of the firm’s differentiated features.

Answer 1

Answer:

B) Focusing on a more narrowly defined segment and "outfocusing" the focuser.

Explanation:

Ikea is a cost leader, but it also focuses on offering differentiated features that appeal to its target market (young buyers interested in stylish furniture at low cost), like unique designs, extended hours, playrooms for customers' children, etc.

So if another firm wants to beat Ikea at its own game, it must offer similar but better services and products by focusing on Ikea's strengths and beating them on their own game.