Example of using a low-cost strategy

Reference no: EM133211835

Question: Walmart, the retail giant, is an excellent example of using a low-cost strategy. They apply with a multitude of resources. Walmart keeps its everyday prices low, even lower and average than Amazon. By doing this, while they may lose a bit of revenue on the initial they make it back quickly with total sales. Buyers are faced with the question, do I want to wait for this to come through Amazon, or do I want to go to Walmart? Even with prime being an option with Amazon, people wish to their immediate desires to be met. If you need a part to finish a bathroom assembly to be able to use the restroom, are you going to wait for the tool on Amazon or just run to Walmart? WWith the combination of having little to no competition, being everywhere, the bargaining power since they are the world's largest retailer, and the automation of their stores, Walmart has no problem keeping costs down.

A company with a differnation strategy is Apple. They can change whatever prices they want because they have a premium product and nothing is evenmclose. Say what you want about the IPhone but its on of the top and most respected and trusted brands of this generation. They also use their ecosystem of products to "trap" the consumer and its harder to leave their brand. Its not just getting new phone you may also have to get a new watch,headphones, computer, web browser. They expand and retain there customer base by providing a large amount of different products that all work together.

It doesn't hurt your experience to not have any particular one but you will find once you add another item it works so much better you don't want to go back to not having that item

Reference no: EM133211835

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