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Social stratification
Elements of social stratification
Social stratification
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There is a new generation of competitors that has entered the market and is posing a great threat to larger companies. These companies tend to operate more on a specific niche, which makes them appear “closer to the customer”.
These companies concentrate on selling to a smaller market. This can help lower costs because specialization creates savings. These smaller firms can concentrate on establishing a strong image and position in their niche. Niche marketing also targets customers more specific needs. Customers today have more of a selection to get the “exact” product that they desire.
The Solomon text refers to a subject that can help illustrate the benefits of niche marketing. On page 457, Solomon refers to social stratification. Social stratification refers to a creation of artificial divisions in a society: “those processes in a social system by which scarce and valuable resources are distributed unequally to status positions that become more or less permanently ranked in terms of the share of valuable resources each receives.
The current market is divided between a few powerful competitors that can relatively easily attract customers from one another as the switching costs are low and practical absence of product differentiation contributes to the easy loss of market share.
Besides marketing its customer service, the company markets different programs according to its three major types of customers. Some of them being,
In light of an evolving market, faced with new competitors, and after a careful analysis of their current customers, the Vanguard Group (hereinafter referred to as “Vanguard”) realizes it must rethink its entire marketing strategy. However, in order to protect and leverage their competitive advantage, which is their low management fees, and to optimize the loyalty that their customers continuously demonstrate toward their organization, they must now target the most profitable segment for them, and develop the best way to serve and delight these customers.
Large players can offer competitive prices if they buy in bulk. Smaller players can differentiate themselves by offering niche products and superior customer delight at a premium price.
In other words, from a perspective that considers society as something like an organism, the theory argued that this organism has needs that must be met if it is to remain healthy. Among these needs is for the most important positions or jobs in the society to be staffed by the most qualified and competent people.~Social stratification is considered a mechanism that ensures that the need is met. looking at Talcott Parsons who wrote "central for the purposes of this discussion is the differential evaluation in the moral sense of individuals as units." (Parsons 1964:70), meaning that status or honor is the most important dimension of social stratification. In other words, members of society are evaluated and ranked based on how well they compare to the dominant values of the society they reside in, resulting in a social hierarchy. Parsons recognized wealth and power differences, of course, but for him these are by definition secondary. Writing of wealth, Parsons (1964:83) stated, "In spite of much opinion to the contrary, it is not a primary criterion, seen in terms of the common value system. . . . its primary significance is a symbol of
Other competitive activities included sales promotion, advertising, and product differentiation. Larger companies have a much greater financial ability to be able to invest more into advertising than a new business starting out would be able to. Shelf space and competitive pricing were two major issues that affected sales. Because they are already recognizable brands, they can afford to purchase the best shelf space. Consumers will see their products before noticing other, not so well known products.
Rivalry among established firms is fierce. There are several factors that illustrate this: established market players (6.1). The product is highly standardized and the switching costs of the customers are low. Players are aggressive (6.2)
Social stratification is the idea that everyone in society has a certain place that they are either assigned or an area that they fit in. These groups or areas generally fall into different placement son the hierarchy of society. Just like every hierarchy structure, there are those that are on top and then there are those that fall on the bottom of the structure. In modern society there is a clear line between the benefits of being on top of the pyramid compared to being on the bottom of the pyramid. Even being in the middle of the pyramid does not always mean things are going to be the best.
1) As companies trying to sell consumers stuff, they are not competing with them, only other companies,
For instance, convenience offerings are low-priced goods that consumers can effortlessly acquire because they are relatively ubiquitous while shopping offering requires the consumers’ effort in comparing and contrasting various brands and retail outlet to find the best product at a good price. Besides, while convenience products are needed on a daily basis, shopping goods may not be required on a daily basis and it has a higher price compared to convenience goods. (Tanner & Raymond, 2010). Furthermore, specialty products are different from convenience and shopping offering because it is more expensive from the previous offerings and it is also not commonly sold in retail outlets. The consumers are few and the products are purchased less frequently, which give it a high margin profit. Finally, unsought offerings are different from all because they could be acquired even when it may be unnecessary at the moment. It is a product of circumstance by any
The Effect of the Development of Large Firms on Society Many firms choose to expand in size because of the cost and market share benefits the firms can reap. However, the development of large firms may not always be of benefit to consumers, and the advantages and disadvantages will be discussed in the following essay. Because larger firms such as Shell Petrol Station are able to experience internal economies of scale through lower unit costs, many of the cost savings are then passed on to the consumers through lower prices. Hence consumers are then able to enjoy greater consumer surplus, defined as the difference between the maximum price that a buyer is willing to pay for a good or service and the actual price paid. As seen from the diagram below, the marginal cost curve shifts to the right such that the new marginal cost = marginal revenue equilibrium lowers the price and increases the output level compared with the initial equilibrium.
With the rise of the economy, consumers have become more and more knowledgeable on selecting their favourable product as a result the organization cannot focus on what it sells but on the side focus on what the customer wants to buy.
Difficult to regain trust of existing loyal customers who expected high quality and performance when in competition with other firms in upper trade market.
The system adopted by 7-eleven maximizes the threat for new entrants. That’s means that threat of new entrants of 7-Eleven is low. It is because 7-Eleven has already reached economies of scale through maintaining a strong customer base and brand loyalty. Over the years, 7-Eleven has increases their customer and brand loyalty. The access to latest technology and capital investments in the same ensures that the barrier for entries for new entr...
Finding a niche market is a becoming successful in business. Business people who achieve great success focus on a particular niche market. There is a sound reason for this factor. While everyone knows that money can be made from selling new and used parts of automobiles, the lack of