Porter sees two main competitive options: pricing (cost leadership) and product policies (differentiation). The goal of a cost leadership strategy is to offer products to the market at the lowest cost. This entails rigorous cost reductions. In applying a differentiation strategy, the firm attempts to establish the uniqueness of its products and services, as a basis for charging higher prices. The distinctiveness can be founded on the technical features of the product, for example, or on the design, brand name, customer service, or the retail network.
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