Categorising where Ster Kinekor is in the industry life cycle, it is first necessary to identify and describe what the industry life cycle is. The industry life cycle involves the changes that take place in the industry which contains the introduction phase, growth phase, maturity phase, decline and renewal phase. Identifying and understanding were the organisations is in industry life cycle is extremely essential as each phase involves opportunities and threats towards the organisation (Ehlers et al 2014:224).
The introduction phase consist of managers of new organisations experimenting with varies ways involving production and distribution of their products to consumers to obtain their loyalty and the winning technology. The …show more content…
Competitors does not distribute VIP lounges.
Differentiation is the best strategy to follow states Ehlers et al (2014: 186), when there is a small segment of competitors, there are varies ways of the adding unique different products or services to the organisation from competitors and not easily emitted, technology keeps changing, high industry barriers and the product has an wide appeal to different consumers. Thus this is unquestionably the strategy for Ster KInekor.
Potential pitfalls of using differentiation as an strategy includes according to Ehlers et al (2014: 187), Uniqueness that is not valuable, too much differentiation, charging too high premium, a uniqueness that is easily imitated and dilution of brand identification through product-line extensions. Grand …show more content…
The internal growth stage consists of concentrated growth, market development, product development and innovation (Ehlers et al 2014:201-204). Internal growth is when a company like Ster Kinekor expands internally, this could be adding a product to their product line. Ster Kinekor had an innovative idea through deciding to add IMAX as one of their options when going to their cinema in varies branches.
We determined earlier when we evaluated Ster Kinekor that because they expanded into adding IMAX they restarted their growth stage. With the restart of their growth phase by adding IMAX they differentiate. By doing this they enter a differentiation generic strategy, this can be seen when customers expects the company to provide something different than the rivals, the expected differentiation causes Ster Kinekor to be more innovative in order to keep their competitive advantage and this cycle to become complete because this in turn forces Ster Kinekor to always look for innovation to be able to differentiate. (Ehlers et al