What is a business-level strategy?

What is a business-level strategy?

Business-level strategy refers to providing value to your customers by using your company’s primary competencies. This strategy helps your company to achieve a competitive advantage in the marketplace. 

Types of business-level strategies

  1. Cost leadership strategy
  2. Differentiation strategy
  3. Integrated low-cost differentiation strategy
  4. Focused differentiation strategy
  5. Marketing strategy

1. Cost leadership strategy

In the cost leadership strategy, you sell products at a lower price than the competition to target a broad audience group. 

If you want to employ this strategy successfully, you should reduce your operational expenses. 

You can reduce the operational expenses by using the correct material, technology, and labor needed for producing a product. 

Here’s an example of the implication of cost leadership strategy. 

Say that a company is manufacturing watches. If it manufactures hundred good quality watches, the production costs will be higher.  

On the other hand, if the company manufactures thousands of watches, it can share the parts among the watches. This helps reduce the operational cost. As a result, the company will be able to offer the watches at a lower price.

2. Differentiation strategy

If your product offerings are different from your competitors, you can attract more people. 

In the differentiation strategy, providing value to customers matters more than selling the products at an affordable price. Since you satisfy customers’ expectations, they will be ready to pay a higher price to purchase your product. 

Apple is one of the companies that has successfully implemented the differentiation strategy. 

The product offerings from Apple stand out from the competition. So, though the pricing of Apple products is on the higher side, people purchase them.

3. Integrated low-cost differentiation strategy 

In a marketplace, cost and differentiation are the two primary factors that give your business a competitive advantage over your competition. 

In the integrated low-cost differentiation strategy, you offer the products for an affordable price; also, you make your product stand out from the competition. 

If you use this strategy, your product can appeal to a wide range of audiences. However, if you want to increase your profit, make sure to keep the operational costs under control. 

You can consider motorcycles from TVS and Bajaj as an example of companies using the integrated low-cost differentiation strategy.

TVS and Bajaj offer feature-loaded and high-performance motorcycles for a price significantly lower than foreign brands like KTM. 

This value-for-money factor makes TVS and Bajaj motorcycles sell in high numbers. 

4. Focused low-cost strategy

In this strategy, you use the cost leadership approach of selling products at a lower price than the competition. However, instead of targeting a broad range of audiences, you narrow your target audience. 

This strategy is suitable if you can’t afford the manufacturing and selling costs involved in offering multiple products. 

Moreover, you can use this strategy if you prefer to sell your products only to a specific audience group. 

In the focused low-cost strategy, since you’re targeting a niche-based audience group, you can advertise your products in a way that your audience prefers and make a lot of sales. 

5. Marketing strategy

If you want to make your product successful, it’s essential that you use the correct marketing strategy to promote it. 

As a business owner, you can either opt for traditional marketing or digital marketing to promote your products. 

Traditional marketing refers to using channels like billboards, magazines, broadcasting, etc., to promote the products. 

Digital marketing refers to using channels like SEO, social media, email marketing, etc., to promote the products.

If you want your product to get better exposure by spending a lesser amount, you can opt for digital marketing. However, if you’re already running digital campaigns and want to expand your marketing channel, you can do both traditional marketing and digital marketing.


I hope this blog gave you a clear idea of business-level strategy. 

The business-level strategy helps you achieve a competitive advantage in the marketplace by providing value to your customers. 

You can employ the business-level strategy in your business to boost your profit and increase brand awareness.

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Author: Abdul Wadood

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