Chapter 5—Business-Level Strategy
Differentiate on cost and fun ambiance
Midwest Express Airline says: “the best care in the air,” “high-
quality travel experience,” “The best airline in the U.S.”
(7 consecutive years), “Most comfortable coach seat” (10
consecutive years); typical meal: filet mignon with lobster, a roll
with butter, spinach, mandarin salad, and chocolate banana-split
cake—Differentiate on prestige, comfort
United, US Airways, Delta, American Airlines, etc. says:
“more flights to . . .”, “more schedule flexibility”, and, “if you
want low cost, you will need to be flexible on your schedule”—
Mixed
(For example, Delta’s Fan Fares offer travel bargains to cities
hosting special sports events, concerts, exhibitions, etc., but
travel is restricted to this coming weekend. United offers
various “specials” from E-Fares, last minute fares, priced-to-go,
etc. Finally, American Airlines offers AAdvantage Net SAAver
Awards. Like their rivals, these are next weekend travel for
either fewer miles than normally required or for lower fare and
must be purchased by Friday.)
Ask
Assume that you were placed in one of the above airlines’ jets, but all
company logos and emblems were removed. Would be able to tell
whether you were seated in a United, American, or Delta Airlines
aircraft?
Structure for Differentiation Strategy - General Motors
Structure and Product Differentiation
Which structure is most efficient for a multi-product line company like
GM? Which structure is most effective? Consider the automobile
industry.
GM uses an M-Form Structure, which includes 12 automobile divisions.
Buick
a. Geographic reach: U.S., Canada, Israel, and China
b. Six models: mid-sized, luxury cars, and SUVs
emphasizing style and substance
c. Logo/Slogan: The Spirit of American Style
Chevrolet
a. Geographic reach: U.S., Canada, Mexico, Europe,
Middle East (Israel, Saudi Arabia, etc.), and Far East
(Japan, Taiwan and China)—Most global brand
b. 22 models: small to mid-sized cars, trucks, vans, and
SUVs emphasizing style and substance
c. Logo/Slogan: Full Throttle—Charging Ahead
Cadillac
a. Geographic reach: U.S., Canada, Mexico, Europe,
Middle East (Israel, Saudi Arabia, etc.), and Far East
(Japan, Taiwan, and China)
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