‘Stuck in the middle’ strategy
Category: Marketing
The E company has no clear strategy. It can be strong in some areas, however, not due to the implementation of one of the mentioned four basic competition strategies. The company has more or less chosen to spread over the four strategies. In relation to the product it would aim at cost dominance and at the same time differentiate as it seeks to focus on the entire market as well as on a few segments. This company seeks to meet all demands but will end up with no special qualities. It will be stuck in between.
The company lacks knowledge about the five driving forces of the business and has no clear strategy, except cost, and would consequently spread its resources in an attempt to meet all demands. The result is that the company never obtains competition advantages and will be outdistanced by its competitors who have a more strategic profile and hereby in a better position to meet the needs of the customers.
To be stuck in the middle is unpleasant but not specifically uncommon. Market strategy implies decision-making in relation to the conditions of how a company compete on the market. The company is therefore making the mistake not to make any decisions. It hereby omits to create a basis of understanding of the market which can contribute to an increased strategic awareness.
The E company’s strategic position would normally result in lower earnings than the average of the business unless the competitors are likewise stuck in the middle or the business is extremely lucrative. The mentioned reservations are close to wishful thinking for which reason it can be expected that such a company would have lower earnings than the competitors who are positioned within one of the four basic competition strategies.