Does Different Business Strategy Is Indeed a Requirement for Success - Essay Example

Playing it differently The current market condition is characterized by high level of competition. This implies that business organizations have to be very innovative, dynamic, creative, and aggressive in their business operations in order to retain market share in the competitive market conditions. Competition is even more profound in businesses surviving in competitive markets. Companies will therefore resort to innovation whereby new untapped markets will be created. However, creating and investing in new markets has its risks and disadvantages. The other option involves applying robust efforts to provide the same services and products better than any other player in the same industry does. However, the benefits cannot be retained for a long time. Therefore, the most successful business organizations resort to a hybrid of the two options. Best market players combine innovativeness and best of service to produce a different business field where competitors will find hard to compete. Most successful global business organizations have indeed survived the torrential market conditions by playing it differently. This paper presents supportive evidence that a different business strategy is indeed a requirement for success. Some of the best market players such as Apple, Coca-Cola, and Toyota are investigated as the best examples of market players who have played it differently and become successful. Apple is one of the leading companies in the production of high-tech electronic gadgets. Due to its success, the company has become envy to most companies that are trying to follow its steps. With Steve Jobs as its current CEO, the company has achieved much success than other companies that have been in the industry for many years. Currently, the company’s market capitalization has exceeded $ 200 billion and this makes Apple find a position in the top ten companies in the globe. Currently the company is ranked slightly below Microsoft, which is the leading technological company in the world (Christopher, 1992: 103). The most striking thing about the success of the company is how fast the company has achieved the success. Other market players in the industry are hoping to learn the secrets of the company and if possible emulate them (On product management, 2012, web). To understand Apples secrets, one needs to make a detailed analysis of its business strategies in order to determine how the same has indeed contributed to its success. Firstly, unlike other companies in the industry, Apple is a vertically integrated company. This implies that the company control or owns most of the technology required to produce its products. Apple is therefore able to manipulate production of its products depending on changing market demands. This involves constant innovation of new products and services that meet and exceed the current needs of the market. Some of Apple’s products such as the iPad and iPhone meet the modern needs of stylish and user-friendly communication devices (On product management, 2012, web). Playing a different game has enabled the company to make appreciable achievement in the market that had been dominated by heavy market players such as Nokia and Motorola. Apple integrated innovation and quality service to come up with a different business platform where other competitors found hard to compete. The iPhone is regarded as the first ever Smartphone to be produced. Unlike the other companies, Apple did not do invent a new product nor did it roll new services. It only capitalized on the already existing inventions and market to launch unique competitive products. The company did not market its products using new strategies but it only refined the existing strategies to perform exceedingly better in the competitive market. Apple did not achieve its success by producing new market brands but did it by integrating innovation to current products to come up with hybrid products that meet market expectations. Although the other mobile phone industry players have not failed, they certainly lag behind when compared with Apple. This shows how a company can achieve appreciable success within a short period by using different approach and strategies than its competitors. Apple did a lot of market research to understand the needs of modern mobile phone users. The modern society demands access to computer at virtually all times. Therefore, Apple found it imperative to make products that would serve as a computer and a communication device at the same time without compromising on style. In addition, the company launched its products on the same markets that other companies had established and controlled for a long time (Rokeach, 1973). This way, it was able to achieve meaningful success by doing it different from other players who have been in the same industry for a long time. John Styth, a former pharmacist, is the man behind the success story of Coca-Cola Company. The success story follows successful introduction of a refreshing soft drink in Atlanta, Georgia. The drink took the world by storm. Presently, Coca-Cola is and international brand that controls the largest market share of soft drinks industry. The drink is sold to more than 700 million daily customers in over 200 countries worldwide. When Styth begun producing and distributing the drink from his backyard in May 1886, he never imagined that the drink that was once served from a brass kettle would become the world’s favorite soft drink (STONEBTB, 2010, web). Some years later carbonated water came into existence and Styth viewed it as a stepping-stone towards producing the word’s favorite drink. Following successful introduction of the drink, the company had to take the next steps towards making necessary expansions. In 1981, Ass G. an Atlantic company acquired the company and this marked the beginning of its success. In 1893, the company became a fully registered company with patent on its favorite drink Coca-Cola. Unlike other players in the soft drink industry, the company has been able to make numerous achievements. The company has not gained it success from being the best producer of soft drinks in the market but due to its unique marketing style (Payne et al 1991: 98). For instance, in 1985, the company did its worst market mistake by introducing a new drink into the market. Although the company had carried out massive research on the taste preference of the new drink, the market reception was not successful (STONEBTB, 2010, web). The new drink did not perform as expected and the market value for Coca Cola’s shares dropped drastically. In particular, the market value of its share dropped from 15 cent to as low as 1.4 cent. Coca Cola’s manger responded by reintroducing the old coke into the market to stabilize the situation. Coca-Cola invests heavily on marketing and brand positioning such that other competitors are unable to keep up with the competition. Unlike other companies in soft drink industry, Coca-Cola has been very vibrant in corporate social responsibility than any other company in soft drink industry. Instead of investing heavily in making new brands, the company plays it differently by investing in corporate social responsibility campaigns. The Olympics is a worldwide event that has never been complete without Coca Cola’s sponsorship since the first event was held in Atlanta Coke’s home ground (STONEBTB, 2010, web). The company has also been active in sponsoring other worldwide events and sports such as the 2010 FIFA World Cup. The company not only believes in sports in its efforts towards the community development but it has been active in support of education through its scholarship program that has enabled thousands of students worldwide achieve their educational dreams (Sexton. 2010: 47). The company’s dreams toward a better world do not end with its sponsorship on education but the company has been involved in sponsoring space exploration activities. In 1995, the first space shuttle discovery made its first trip to the space with Coca Cola’s sponsorship. The company therefore solidifies its confidence in the market thereby gaining advantage over other competitors. Although time is abundant, it is one of the most valuable capitals to any business, Brady et al. 1993. Coca-Cola became a successful company by marketing its products on the same market that Pepsi had sold its products. However, Coca-Cola used different sale promotion methods particularly in brand positioning. The company simply added value to its products by using different sales promotion strategies to become a market leader (Harington, 2009, web). In the process, the company saved on time that would otherwise have been used to create a new market. This proves that a company needs not do the same thing better than its competitors do but make a different approach in its business strategies. As stated by Christopher (1992) “success involves trying something new and therefore making mistakes is unavoidable.” This implies that success in business cannot be achieved without trials and taking of risks. Taking chances in new business ventures can sometimes be costly since poor response of the market may cost the business a lot (Barwise, 1992: 86). Although creating or inventing a new product is an appropriate method that a company can apply to achieve success in the competitive business world, the method has attached risk factors. A successful company takes risks while at the same time tries to avoid losses that may rise from the risk. A successful company will therefore be rated by the amount of losses it is able to avoid as it continues to take risky ventures. Although taking risks is an important part of running a company, avoiding some risks is of equal importance and therefore companies should ensure that they avoid risks by all means (Harington, 2009: 354). Using different business strategies instead of creating new markets is a method of avoiding risks. Successful companies will therefore produce and market similar products and services but use different business strategies than their competitors. Toyota is a good example of a company that has achieved most of its success not by changing the game and its rules but by playing the same game differently. Operating in a capital intensive and highly restricted motor industry, Toyota did not have an option but to employ a more effective business strategy in order to compete effectively with other well-established competitors (Aaker, 1991: 109). Due to the intensive capital required in the industry, the company could not use its capital base as a competing factor against the well-established competitors such as Mercedes and the American company General Motor. By evaluating the needs of the motor industry market, Toyota rolled a new strategy of producing the same products but in a form that would meet customer’s demands. Toyota achieved its success by producing fuel efficient, stylish, yet affordable vehicles. This came in time when there was a heightened campaign for more fuel-efficient and ecofriendly technology. The company therefore did not succeed by making new inventions in the motor vehicle industry but by employing a different business approach to the same products. Although they still market luxury products, most of the vehicles produced by Toyota are affordable and most importantly, more fuel-efficient. Currently, Toyota controls a big share of motor industry despite the stiff competition in the industry. Conclusion The success of a company is determined by how well it secures its market share compared to its competitors in the same market. Although inventions and innovations may seem to be the best option especially in the competitive markets, the approach is risky and costly. Combining innovation and new and unique business strategies is the best option. Selling the same products but adding innovation in production has enabled Apple emerge as one of the most successful companies in the highly competitive mobile phone industry. Coca-Cola uses the same recipe as its competitors to create soft drinks but uses a different marketing strategy to expand and maintain its market share in the soft drink industry. Similarly, Toyota markets vehicles but uses a different business approach. Their product meets the needs of current automobile users and does so at an affordable price. By playing the game differently, a company gets an already established market, saves time, and avoids risks involved in taking new ventures. A company therefore does not need to do the same thing better than everyone else does but playing a completely different game. References A. Payne et al 1991. Relationship Marketing. Oxford: Butterworth Heinemann. D. Aaker, 1991. Managing Brand Equity, New York, NY: The Free Press, J. Brady et al. 1993. “Marketing’s mid-life crisis”, The McKinsey Quarterly,(2) 12-78. M. Rokeach, 1973., the nature of human values. New York: Free Press. M. Christopher 1992. Logistics and Supply Chain Management. London: Pitman. N. Richard, 1996. Attitudes and persuasion: classic and contemporary approaches. Colorado: Westview Press. P. Barwise, 1992. “Brand portfolios”, European Management Journal, Vol. 10 No. 3. R. Sexton. 2010., Exploring Economics. London: Cengage Learning R. Lamming 1993. Beyond Partnership: Strategies for Innovation and Lean Supply. Englewood Cliffs, NJ; Prentice-Hall. On product management, 2012. The secret to Apple’s success? http://onproductmanagement.net/2010/05/20/the-secret-to-Apples-success/[viewed January 17, 2012] np. 2010. Coca Cola Success Story. STONEBTB.com [viewed January 17, 2012] Read More