The main difference between companies following a cost leadership strategy and those following a focused cost leadership strategy is
A) standardized market price.
B) industry life cycle stage.
C) degree of market segmentation.
D) age of the market.
E) market trajectory.

Question

Quizplus · Accepted Answer

The main difference between companies following a cost leadership strategy and those following a focused cost leadership strategy is the degree of market segmentation. Cost leaders target the broader market and aim to achieve the lowest costs in the industry through economies of scale and efficient operations. Focused cost leaders, on the other hand, target specific segments of the market where they can dominate through cost leadership. They focus on a narrow market segment, such as a particular product type or customer group, and strive to offer the lowest costs in that segment. Therefore, the degree of market segmentation is the key distinguishing factor between these two strategies.

The Main Difference Between Companies Following a Cost Leadership Strategy