Differentiating Strategy vs Cost Leadership Strategy

Database Systems A relational database systems is one that allows a firm to maintain data and link it in diverse and functional ways (Wambler, 2015). Different data categories will link/relate to others, which is where the name relational database comes from. By linking the tables, code can be written and applied that searches for categories of data connections that tell the firm something about the users or consumers of their product.

For example, online users of online stores and sending out signals of data that can be collected and stored in a relational database. This data tells the firm everything from where the consumer is located to what sort of sites he visits (cookies enable this to happen), to what he is looking at in the online store, etc.

The firm collects information on the individuals without the individual even knowing it and the firm then pools all of this information into a vast database system -- the relational database -- where it connects and intertwines with information pooled from other users. The purpose of this gathering and pooling of information is so that the firm can have a superior idea of who its clientele is and how to better market to and capture that consumer and potentially that consumer's brand loyalty.

All of this can be assessed by using a relational database and reading the data in a way that tells the firm specifics about its consumer base. The concept of big data is especially relevant in relational databases because the data sets that are gathered are so enormous that processing the information in traditional methods does not work. Big data is only as effective as the strategy used to visualize it, search it, share it, analyze it, and utilize it.

A firm's ability to process big data will play a definitive role in its ability to capture market share and develop brand loyalty in the digital age. Using a relational database, the firm can identify trends, consumer behavior patterns, areas where information is lacking, and the links that bring consumers in (where for example the consumer was before he/she ended up on the firm's page).

The firm can build strategies of identifying the type of customer accessing their stores and building a marketing campaign centered on this type, or the firm can develop individualized marketing campaigns that respond to signals sent out by the consumer, which are read by the relational database and used to develop an ad that "speaks" directly to the consumer's individual needs.

Of course the aim of the firm must be decided: if market share leadership is the aim of the firm, then a cost leadership strategy will be the focus of use for the relational database. If differentiation is the strategy, the firm can use the relational data and the big data sets to develop a service/product that differentiates the firm from its competitors and makes it stand out (Thakur, 2014).

The firm will likely need to choose one way to go because a middle of the road strategy does not tend to lead to profits. Low-cost is the way to winning market share, but uniqueness often means that products cost more; so that is the trade-off. A path that tends to neither one side nor the.