ACCA SBL Syllabus C. Strategy - The Influence Of Strategic Groups & Market Segmentation - Notes ^{3 / 8}

This identifies firms with similar strategic characteristics e.g.

1. Product and geography diversity

2. Distribution channels

3. Marketing effort

4. Quality of product

5. Cost position

6. Pricing policy

7. Ownership structure

8. Size

9. Relationship to influential groups (e.g. Government)

Why is this useful?

Well it is only useful when there are many competitors, but it helps in the following ways:

1. Helps identify direct competitors

2. On what basis the competitive rivalry will happen

3. Helps analysis of whether / if can move to other strategic group

4. Might identify opportunities elsewhere

Market Segmentation Analysis

1. Geographical area

2. Quality preferences

3. Function

4. Consumer or business customer?

5. Social status

6. Age

7. Life-style

This type of analysis can show “gaps in the market” or “strategic spaces”. Once these have been identified, then analysis into an amended product can be conducted