9780470687604

Summary

What people are saying about Discount Business Strategy: "Michael Andersen and Flemming Poulfelt provide a provocative discussion of the rapidly growing role of discounters across numerous industries: how they operate; how they create uniqueness; and how they can destroy value for incumbents. Understanding the specific moves and tools that the authors analyze will be valuable for attackers and incumbents alike." -Adrian J. Slywotzky, Director, Mercer Management Consulting USA "This book is very timely, dealing with today's most critical strategic issue: how to provide more value to the consumer through aggressive discounting. Those players in manufacturing and distribution who master this will be the winners; many established firms will fall by the wayside. A similar set of issues are facing many nations today - Europe vs. Asia!" -Peter Lorange, President, IMD, Switzerland "Andersen and Poulfelt have researched one of the most important themes in today's business world - how fundamentally new business models have wiped out establishments not with new products or technologies, but by creating new rules for conventional industries. Read this book and learn how to recognize the disruption of your industry before it is too late!" -Sigurd Liljenfeldt, Senior Partner, Monitor Group, France "This book asks if a firm can have its cake and eat it too - that is, maintain high quality at low prices. My favourite example and shopping place is big box Costco. Ikea is another. A must read for a broad audience concerned about corporate survival!" -Professor Larry E. Greiner, Marshall School of Business, University of Southern California, USA The aspiration to adopt the right strategy still prevails over the business world. But is there a single 'best' strategy for a company? Can an organization create sustainable competitive advantage from an 'off-the-peg' strategy? And are most companies likely to craft a strategy that genuinely creates uncontested market space and makes the competition irrelevant? The answer to all these questions is probably 'No'. And the rising tide of companies like Dell, CostCo, Skype and Linux means that asking them at all may soon be futile. While strategists have foundered in old paradigms, a new breed of competitors has emerged. Value destroyers. Old-style thinking understood value destruction when it was confined to an industry and driven by a new product or technology. But what are the implications when the destruction stems from a new way of thinking - from a strategy that simultaneously creates value? The implications are enormous. Every company in every industry is potentially at risk. This risk - or opportunity - is precisely the reason for this book and its focus on exploring why and how some companies have bridged the gap between differentiator and cost leader strategies to emerge as winners in hypercompetitive markets, and what this entails in terms of value destruction and creation. Discounting organizations are here to stay - are you?

Foreword
Why are some companies more successful than others?
The real life laboratory
Creating value and simultaneous destruction
The volume game
Simplicity the word of the day
Cut to the core
Service? Something we'd rather do ourselves
The black box of strategy turned upside down
The oxymoron of existing strategies: where do we go from here?
Conventional strategic thinking
The generic strategy framework
Porter challenged
Mixed strategies-the airline industry
When discount strategy becomes important
Hyper competitive markets and traditional strategy
The position of a discount strategy
A single form-a simple form?
Case 1: CBB
Cultivating a hyper competitive market by way of a consistent approach to the notion of discount strategy
A contradiction to the bursting of the IT-bubble
The mobile sector-hyper competition
CBB as the enhanced service provider
The original mission and strategy
Crisis and the filing of a petition for bankruptcy
The discount strategy-not a single quick fix
New management
Reinvention of the IT-systems
A new customer care concept
New brand and branding
Reverse relationship marketing
Political mass marketing
Reorganization of the distribution
Cost cutting programs
Active price leadership
CBB's discount product-cheaper and better
Product production characteristics
Product marketing characteristics
CBB's use of price as a tactical weapon
The importance of the price vis-à-vis the customers
Active leadership in price wars
Results-best in class
A revolution in the mobile sector?
Perspectives
Case 2: Lidl
Gaining ground in a hyper competitive market by a consistent discount strategy
The German conquest
The grocery retail sector-hyper competition
The original mission and strategy of Lidl
The discount strategy-all encompassing
Structured to control the impact of external factors
Leadership through continuity
The look and feel of Lidl
High service level with a discount concept
Squeezing the brands
Aggressive go to market strategy
Publicity through secrecy
Active price leadership
Lidl's discount product-cheaper and better
Product marketing characteristics
The use of price as a tactical weapon
Active leadership in price wars
Results-top of the class
Perspectives
Case 3: Ryanair
Reshaping a competitive market through a consistent discount strategy
Flying with the giants
The airline industry-liberalized to full competition
The early days of deregulation
Towards the liberalized sky with a new strategy
A transformed and polarized industry
Ryanair as the alternative independent carrier
Financial collapse evaded at the 11th hour
The no frills, low fare strategy-not just one route
New management
Cost cutting programs
Productivity-based compensation schemes
Outsourcing to third parties
Re-organizing sales and distribution
Harmonizing and scrutinizing the fleet
Customer care concept
New brand and branding
Political mass marketing
Active price leadership
Ryanair's discount product-cheaper and better
Product production characteristics
Product marketing characteristics
The use of price as a tactical weapon
The customers' perception of price
Leading the price wars
Results-Best in class
Perspectives-a revolution in the airline industry?
The building blocks of a discount business strategy
Maturity and liberalization in different industries
The building blocks of a 'discount strategy'
The product
The brand
The customers
Technology
The four blocks as one discount strategy
The attractiveness of the core product
From peaceful coexistence to disruption
Disruption and the corresponding value destruction
Lean and unbundled nature of the discount product
Self-service an important ingredient
Aggressive pricing
Demand-driven products
Value creation
Back to basics
A good brand is much more than a good brand
The growing importance of 'brandr'
'You need to invest money in the establishment of a good brand'
We cannot afford to spend
David against Goliath
The Gorilla image
Branding as a tool-kit in the discount strategy
Low prices as a new corporate social responsibility position
Brand extension and discount
The good brand
The discount customer and social capital
The pivotal role of the customer in a discount strategy
Customers as social capital
Social capital and the discount customers-the X factor
The social factor in the discount strategy
Social capital and egalitarianism
The dismissal of relationship marketing
Psychology, culture and the discount strategy
The View on discount
Exploitation of the cognitive dissonance
Life-style and satisfaction
The advent of the viral ambassador
The patronizing of customers
The rise and fall of patronizing
Increasing brand promiscuity
Simplicity prevails
How to save costs and increase perceived quality?
The main execution tactics
Finding the suitable technology
Finding technology
The innovator's dilemma and the innovator's solution
The choice of 'discount' technology
Proven technology
Scalability
Technology supporting the simple
Impact on back office system
Technological exuberance avoided
Value creation and value destruction
Strategy and war
Strategy revisited
The building blocks of the discount strategy model
The various execution processes
Epilogue
How to reflect thoroughly on the wider repercussions of successful discount business strategies?
Notes
Bibliography
Index
Table of Contents provided by Publisher. All Rights Reserved.

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Discount Business Strategy : How the New Market Leaders are Redefining Business Strategy

0470687606

Summary

Table of Contents

Supplemental Materials

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