Competitive Advantages: Strategies for Success

Competitive
Advantages

INTRODUCTION
Competitive advantage are those benefits the company gets in order to compete with their
rivals. It allows the organisation to manufacture goods at cheap rates in comparison to their
rivals(Lo and Tian, 2020). This report contains global and socio culture elements of environment
which are important for Starbucks. There are several strategies are used for diversification used
in Google.
MAIN BODY
Global and socio-cultural elements of the general environment are significant to the future of
Starbucks’ retail coffee and snacks store industry.
Socio cultural environment refers to that part of external environment of the firm which
are related to social and cultural change in the environment. The social and cultural elements are
very essential to affect the marketing efforts of any company. Starbucks is an organisation which
deals in retail coffee and snack store industry. Starbucks is a multinational company of Seattle,
Washington. It represents the coffee culture of the society. With the increase trend of coffee the
company is able to expand its business in several ways. The main elements of socio-cultural
environment are language, religion, ethics traditions, material culture and many more. These
elements include various factors which affects the business of Starbucks and also affects its
future sales also. The main factors are explained below:
Consumer Preference: The change in preference of consumers affects the business of
Starbucks(Purwanto and Purwanto, 2020). Taking example of traditional time when people
prefer to went to restaurants there are less demand for the coffee shops. Increase in trend and
preference of customers to meet at coffee shop affects the business of the organisation. With
increase demand for food products, the company also starts to offer various food products with
coffee in their stores. As with the change in trend and preference off customers can decline the
sales and profitability of Starbucks.
Change in lifestyle of population with trends: The lifestyle of people also affects the demand
for the coffee in the market. With increased lifestyle of a locality they prefer to be more social
which increase the need for coffee shop to chill out with friends and family. Starbucks provides
for environment to people to live their lifestyle. Hence increase in lifestyle is also an essential
factor which affects business of Starbucks.

Googles’ level of diversification strategies.
Diversification refers to the enlargement of range of products offered by an
organisation(Amoako and Dartey-Baah, 2020). Diversification strategies are those strategies
which are formulated in an organisation to offer wide range of products of an organisation.
Google LLC is a multinational company which provides internet related services and products to
its customers. It offers wide range of products to its customers such as Search Engine,
advertising technologies, software and hardware and many more. There are three levels of
diversification exist in the market according to the diversification strategy used by the
organisation. Low level of diversification is observed in the companies that operates in a single
business only. Moderate to high level of diversification has two subtypes also that are 'related
constrained' in which less than 70% of revenue comes from main business and 'Related linked'.
The third type of diversification is very high level of diversification in which company deals in
very high range of products in the market. In case of Google which is a large organisation and
deals in wide range of products. It operates with an important business strategy of diversification.
Company believes that it si beneficial to create new market and retain the existing client(Panda,
Modak and Cárdenas-Barrón, 2020). It spends a lot on research and development which helps
them to identify new market and products and ascertain demand of customers. Google offers
better product in the market and set competition for the other companies. This diversification
helps Google to became an internet giant in the market and position itself to stop at one venue to
fulfil all internet related needs of the users. Hence the company Google uses high level of
diversification strategy as a core strategy of the business.
The rationale for LVMH acquisitions
The LVMH stands for Louis Vuitton SE Moet Hennessy. It is a multinational company of France
whose headquarter is at Paris in France. This company deals in luxury goods and is a small
business. The company acquire Tiffany to expand its business. Tiffany and Company is an
American corporation which deals in luxury jewellery which is established in New York. It deals
in jewellery, water bottles, watches, fragrances, accessories and leather goods. The LVMH
agrees of $5.8bnn in order to takeover Tiffany. The main reason to takeover Tiffany by LVMH is
to expand its business in fastest growing areas. It also ensures strengthning position of LVMF in
United states.