Wachovia Company Essay Example

itself from this force is that of focus. Because of the higher material prices, companies have taken on the differentiation-focused strategy. In this strategy, the methodology has been improving the quality of their products, thus enabling them to increase prices without harming customers. Buyers have multiple options when choosing alternative suppliers if they cannot obtain competitive prices, but this can be resolved by providing good customer service and value for money.

The company is at risk of losing customers to competitors in the market. To address this, companies in the market must implement three strategies:
a) Cost leadership: reducing the price of their products is crucial for companies to maintain competitiveness.
b) Differentiation strategy: companies in a particular industry should develop unique products that set them apart from competitors.

The products in question should be both cost-effective and environmentally friendly in terms of pollution and market acceptance. When consumers decide to purchase a specific product, their decision is usually based on the combined value of utility and replacement. Utility value represents the amount that satisfies the consumer's needs, while replacement value refers to the customer's expectations of the product's potential for need satisfaction. Price plays a crucial role in influencing customers, and it is the responsibility of the company's management to determine a price that will attract consumers. If a product lacks good utility value, it is likely to lose purchasing customers, emphasizing the importance of customer purchasing power. Substitutes pose a threat when changes in substitute prices affect the demand for a particular good, creating an elastic price force that companies must combat in order to sustain success in the future.

In order to mitigate the strength

and risk of this force, businesses enhance their differentiation generic strategy within their frameworks. This enables customers to develop loyalty towards the distinctiveness of their offerings. Meanwhile, competition arises from other companies operating in the same industry. The potential threat lies in these companies capturing the market. Nevertheless, the company's strategic approach should be to lower prices whenever confronted with such a threat. Once that company exits the specific market segment, prices can then return to their normal levels.

In conclusion, companies must address the risk of competitors gaining access to their facilities and copying their production methods. To protect their patents and copyrights, it is imperative for companies to ensure that their headquarters are inaccessible to outsiders. Additionally, companies can mitigate the risk of losing employees to rival firms by providing competitive compensation packages. Wachovia exemplifies strategic success in the case study, surpassing its competitors and maintaining a stable position. The company's debt has begun to decrease while revenue and profits continue to rise.

Wachovia's success can be attributed to their focus on addressing and minimizing weaknesses and threats. However, challenges related to the economy and competition remain significant factors. As a result, the company remains committed to offering competitive prices for products and services while acquiring new customers to increase market share. Wachovia implements horizontal integration strategies by transferring experts to underperforming operations, transforming them into profitable business units. The company's strong brand presence also helps overcome entry barriers in foreign markets such as India and China, aligning with international strategic objectives. However, operating in these markets initially faced challenges due to competition from local small companies.