Focus strategy
A focus strategy targets a relatively narrow customer group, segment or geographic market and seeks advantage within it. In Porter’s framework, cost focus aims for a cost advantage in the segment, while differentiation focus offers attributes especially valued by that segment. Understanding distinctive needs or cost conditions is central; serving fewer customers alone does not establish a competitive advantage.
Worked example
A specialist delivery firm serves laboratories that require temperature-controlled transport and detailed tracking. Its segment-specific capabilities support differentiation focus rather than competing with every general parcel carrier.
Common mistake
Do not treat focus as a third universal mechanism unrelated to cost or differentiation. Identify both the narrow competitive scope and the basis of advantage.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | SBL | Direct | September 2026–June 2027 |