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Introduction The objective of this report is to find out what would be the long-term effect on Pacific Fair’s profitability if tenancies were given out to businesses with existing competitors in Pacific Fair. Evaluation was based on Michael Porter’s model of generic strategies to determine whether two competing businesses, Rebel Sports and Zelus, are able to co-exist by exploiting their own competitive advantage.4 Detailed analysis will be based upon whether Rebel Sports and Zelus engage a cost leadership or product differentiation strategy. Later on, the scope of these strategies will be examined and a conclusion will be deduced as to whether the level of competition between these two stores brings about any benefit to the center. Product Differentiation Ø Nike is world renowned for being a supplier of quality sporting equipment and clothing products. With such slogans as, “If you have a body, you are an athlete. And as long as there are athletes, there will be Nike” , Nike has targeted athletes specifically. This allows them to define themselves as a product differentiator in the sporting goods industry. Ø Zelus relies on the loyalty of Nike customers, and the belief that their customers see their products as superior to any competitors’ in the industry. It is because of this loyalty that Zelus can charge slightly higher prices in its stores than general sporting goods stores, such as Rebel Sports. As stated in the text, customers are willing to pay more to obtain the extra value they perceive. Ø Focus strategy is a strategy with which an organization concentrates on a specific regional market, product line, or group of buyers. 3 Nike implements a focus strategy for groups of buyers as well as in regional markets. The focus on serious athletes is obvious from the company’s advertisements and quality standards. There are also regionally focused products such as, Bauer Nike Hockey, based in Montreal, Quebec, which is the world's leading manufacturer of hockey equipment and a wholly owned subsidiary of Nike, Inc.
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