Competition and Business Unit Strategy: Walmart and Tesco

2824 Words11 Pages
Comprehensive Overview Area Competition and Business Unit Strategy: Wal-Mart and Tesco Competitive Strategy Wal-Mart, the world's largest retailer incorporates two different strategies to ensure business success as well as higher profit margins. The firm uses both differentiation and cost leadership strategies. Wal-Mart's slogan of "Spend less, Live better" is appropriate for the market given the large number of retailers and the availability of substitute goods. In line with this, the firm provides customers with low-cost items that beat competitors. Due to this, customers shop at Wal-Mart stores for groceries, rather than local grocery stores because of discounted items. In addition, Wal-Mart uses the differentiation strategy to succeed by creating unique products and services to customers. To meet this, the stores' products are marketed in a way that makes customers feel they are exclusive to the store. Wal-Mart has achieved this strategy by offering unique warranties and brand images. Wal-Mart customers believe they are being provided with something that they cannot find at any of the store's competitors. Wal-Mart maintains its status as a big box retailer by seeking profits through a high volume of low-price items. Tesco on the other hand to obtain a sustainable competitive advantage, uses cost leadership. Tesco does this by providing the lowest costs in the industry and offer its products and services to a broad market at the lowest prices. This strategy is based

More about Competition and Business Unit Strategy: Walmart and Tesco

Open Document