Michael Porter argues that the goal of strategy, and a key to achieving a sustainable competitive advantage, is finding a unique and valuable position. In your opinion, has Macy’s found a unique and valuable position in the retail landscape through its new strategy? Explain
After the recession in 2008, Macy’s had to rethink about the leadership strategic decision for the first time in many years. The company was unable to sell off a substantial inventory for a long time. The adjustments made should allow the company to achieve better growth levels. Even though the company when through a tough phase, they were looking forward to making this right back in the retail industry. According to Michael Porter, the goal of their strategy would be to achieve an important position and a sustainable competitive advantage. The strategy forms an important aspect in decision making to create the best path for the employees and stakeholders.
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After going through the case of Macy’s, it explores a unique and valuable position within the retail landscape through the new strategy. The strategy assists Macy’s to achieve a better position in the retail market. The strategy and goal by Michael Porter would be highly advantageous because it puts the company at a better position for the stakeholders. There was a great need to adapt to the movements of the market so as to realize a significant level of growth and progress. The new strategy allows for Macy’s to achieve growth and progress in its retail industry. Doing this would assist the company to realize better results and operate with improved efficiency. The remodeling and revamping process should also put them ahead of other competitors in the business. Even though the company had gone through a difficult phase, adopting the strategy would enable it to achieve a new entry and sustain a long-term presence.
Of the three strategies identified by Porter, differentiation, cost leadership, and focus, identify the one that Macy’s adopted? Explain.
Michael Porter identified three different strategies including cost leadership, differentiation, and focus. The strategies are very important for a business that would like to grow and expand. The strategy adopted by Macy’s is focus strategy. The strategy entails directing the attention of the business towards specific product lines, buyer segments, and targeted geographic markets while making use of another strategy such as differentiation. The differentiation strategy can be used with the focus strategy to create a unique and valuable product or service. Cost leadership involves managing relationships throughout the production costs in order to lower the prices of the entire chain.
Macy’s focus strategy involved locating a market segment and target users. The product design then moves forth with the design of products that meets the needs and expectations of the segment and users. Macy’s will be able to reduce the cost of advertising and promotional budgets significantly and achieve better revenues. The company should also benefit from having increased sales and better inventory management. Macy’s focus strategy is good in achieving significant growth.
In order for Macy’s to maintain its current position and uniqueness, it will have to maintain a constant change in all of its areas of operation. The strategies of the competitors and the economic condition of the country will not always remain the same. Macy’s leadership should thus embrace the concept of change in order to have their future assured. Macy’s found a way to become less conservative compared to the traditional department stores. The strategy was executed in a timely fashion and the company should reap success in the several coming years.
