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Product Differentiation: Smartphone Industry. iPhone vs Galaxy
Transcript of Product Differentiation: Smartphone Industry. iPhone vs Galaxy
Maintaining Brand Reputation & Loyalty
The need to continuously develop and implement new differentiation strategies to sustain
Free Riding on First-Mover's Investments
iPhone vs Galaxy
Lead in Technology
Production Cost: 203$
79.85$ + Lost Apps
+ Lost Media + Time
Profit: 43 Cents per
Suppliers learning curve
Hire trained employees
Follower taking advantage of these
opportunities is a function of the first mover
Product Mkt Position
How can a follower
Lead in Technology
Rotate by Twisting
Zoom by Pitching
Square Grided Icons
Iphone Exterior Design &
: Smartphone Industry
Product Differentiation + Cost Leadership
Why is this topic important?
Strong Brands. Strong Reputation. Loyalty.
Decline or erosion of the loyal consumer
"Once brand loyalty is developed, it alters the course of the demand curve for the product"
focus on Core Competences
Developing own software
Strategic Alliances on Marketing
Target Young Users
Goods and services
Strategic alliances offer a way for companies to obtain a wide range of expertise to meet the challenges of globalization and rapid technological change. While there does not appear to be any universally accepted definition of strategic alliance, three characteristics serve to identify it:
1) The alliance must be strategic and not tactful
2) Alliance’s goals should have long time horizons.
3) It should be mutually beneficial.
Apple's Strategic Alliances
Samsung's Strategic Alliances
Distribution Channels: Apple
"The iStore Experience"
Apple Premium Reseller
Apple corner at BestBuy
“….a typical brand can expect to retain
only two thirds of its loyal customers over five years.”
Ehrenberg Centre for Research in Marketing, London South Bank University
Ehrenberg Centre for Research in Marketing
Journal of Consumer Research
Costly to Imitate