Rivalry among firms in the same industrial coverage has outgrown any other challenge thereby becoming the major threat to business survival (Bimpikis, Ehsani & Ilkılıç, 2019). Multinational companies are going global by adopting better strategies that enable them to be competitively advantaged. One of the most advocated strategies is being different to become more outstanding than the other competitors. Companies own different compelling interests in their struggle for growth and thus the difference in strata application.
Southwest Airlines mastered the art of owning a word in the market for consumer to mark and remember them. Their phrase was simple “Wheels Up.” This simply meant that they would make more money each time their space vessels go up. So they strategized in getting their wheels in the air more quickly than any other competing company. Besides, they also took the initiative of outlining differentiating activities. Their brand promises were achieving low charges, more fun, and more flights. Since these three primary objectives could be attained by any other company, they undertook in differentiating operations. They achieved the objective of charging low fares by scrapping off baggage fees charged all companies. They also decided to use the Boeing 737 only to streamline their operations and dominate the space with more airliners.
IKEA, on the other hand, also got to grips with owning a phrase in the world of furniture. Their phrase “Flat-packed” advocated for saving substantial storage and shipping costs by making furniture that was flat-packed. This whooped their profits more than the industrial average. In addition, IKEA strategized in the declaration of a brand promise. In offering a brand promise, companies identify three things that they can be best at and ignore the rest. The rest will be anti-brand promises but no one will care about them. IKEA has only 7% of the market share but this small percentage replicates about $30 billion profits annually.
The 7 strata strategy drives an effective framework that creates a winning strategy for businesses by differentiating them from others and getting them ahead of competition. Once businesses draft their strategies into place, they only need to work in that line to accomplish their mission. Therefore, getting the right sense of direction is the most critical thing before executing it.
References
Bimpikis, K., Ehsani, S., & Ilkılıç, R. (2019). Cournot competition in networked markets. Management Science, 65(6), 2467-2481.