Strategic Group Concept

A Strategic Group is a group of company belonging to the same activity sector and that adopt similar strategic guidelines according to certain variables. For the identification of the different Strategic Groups in a certain activity sector it’s necessary to identify the strategic variables that better differentiate the companies. Using two of these variables it’s possible to create maps on which each axis is placed a variable and place on it each one of the competitor companies according to its guidelines compared to each one of the variables – each Strategic Group is formed by the group of companies that stand together on the map.

The same way that the market segments provide clients’ analysis, strategic groups allow analyzing the competitors and taking conclusion about the most profitable strategic positioning, about the competitors strategic movements and about the main success critical factors.

Below are presented some of the variables usually used to create strategic groups:

. Range of products / Specialization degree;

. Used distribution channels;

. Differentiation wage;

. Adopted prices’ policy;

. Geographic coverage;

. Vertical integration degree.

 

 

Translated from Portuguese by Susana Saraiva, Portuguese-English and English-Portuguese translation specialist. Contact: spams@sapo.pt.