For example, YouTube focuses on video connections, Flickr centers of photo connections, and Twitter focuses on brief status opdates.
Complementors are value-added products are services that complement another industries products or services. In the online social networking industry, complementors include user applications for the networking site. As an example, Facebook offers thousands of applications members can choose to add to their member account. These typically focus on games and other fun ways that members can interact with other users. These add an additional dimension to the basic networking features of the site and often give sites a competitive advantage through differentiation.
In the end, the online social networking industry is moderately competitive. This is primarily due to the low barriers to entry into the industry. The next Twitter or Facebook or YouTube could be in development at this very minute. In addition, rivalry among competitors is fairly intense, as sites strive to differentiate themselves from other social networking sites through unique features and complementors.
Low Cost vs. Low Price Strategy
Although low cost and low price strategies are often utilized together by an organization, they are two different strategies. A low cost strategy is centered on producing a product or service at the lowest cost. Reducing material, labor and overhead costs are the primary methods of implementing this strategy. However, this strategy does not necessarily have to result in offering a...
Instead, an organization may maintain their current pricing structure and use the low cost strategy to increase profit margins.
In contrast, a low price strategy is one way an organization may choose to compete within their industry. The goal is typically to garner market share through lower price points. This is often accomplished by also adopting a complementary low cost strategy, in order to maintain profit margins despite lower pricing structures.
Examples of low price strategy can be found with store brand foods. Stores partner with manufacturers of food products, package it under their own brand label and then offer it at a lower price point than brand name foods. This low price is their primary means of competitive advantage.
Store brands are also an excellent example of low cost strategy. The food manufacturers stores partner with often offer lower costs to the store. Packaging and packaging design is also minimized to lower costs. Most significantly, store brands do not incur the high marketing costs brand name food manufacturers have, allowing the store to retain profit margins, despite lower price points and smaller volumes.
References
Nuttney, B. (2010). "The social networking market opportunity." Business Insights. Retrieved December 7, 2010, from http://360.datamonitor.com.ezproxy.apollolibrary.com/Product?pid=BI00028-008.
Social networking. (2008). Retrieved December 7, 2010, from http://whatis.techtarget.com/definition/0,,sid9_gci942884,00.html.
