The each of the following independent situations, state whether the company is following a low cost or a differentiated product strategy and explain your answer.
a) Jamphones is about to decide whether to launch production and sale of a mobile phone with standard features.
b) Prestige Computers is trying to decide whether to produce and sell a new home computer software package that includes the ability to interface with a sewing machine and a vacuum cleaner. There is no such software currently on the market.
c) Arvadam Pharmaceuticals has been asked to provide a ‘store brand’ roll on sunscreen that will be sold at discount retail stores.
d) Tim’s Delicatessen is entertaining the idea of developing a special line of gourmet pasta sauce made with sundries tomatoes, mushrooms and truffle oil.
(For each part, one mark for identifying the strategy and one mark for explanation. Total: 8 marks)
