CHAPTER ONE
1.1 Background To The Study
According to Porter Generic (1980). Low cost and differentiation strategy constitute an effective strategy in overcoming strong competition and postulated the pursuit of the hybrid or ‘combination ‘strategies which involves the adoption and implementation of two strategies at the same time as against the adoption of a single strategy. (Kim et al., 2004; Spanos et al., 2004). The hybrid’ strategies combine the feature of both low cost and differentiation elements (Gopalakrishna & Subramanian, 2001; Pro, 2000). A combination strategy provides the advantage of viability profitability. Consequently, firms that pursue the hybrid strategy achieve higher performance than t firms with singular strategy. The pursuit of a differentiation strategy for low-cost (YasaiArdekani & Nystrom, 1996). International Journal of Business and Management Vol. 7, No. 20; 2012 124 A hybrid strategy fundamentally seeks to attain differentiation and low price over its competitor. This is aimed at delivering enhanced benefits to the customers with low price profitably to provide a margin for reinvestment The hybrid strategy facilitates the sale of the product at lower prices than the competitor while at the same time offering higher quality for the product. The hybrid strategy blends the elements of differentiation and low-cost to offer products to customers with a competitive edge. (Thompson et. al, 2012). Most consumers do their purchase of a product with high expectations to pay less price for products with somewhat highly differentiated features. As a result, the hybrid strategy is considered most suitable to meet this customer expectation. The hybrid strategy has become highly essential in the face of global competition when Compared to the single generic strategy. The hybrid strategy facilitates the production of products with differentiated features or characteristics that customers value at an additional benefit of low cost compared to competitors’ products.
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