Nissan’s competitive strategy and growth strategies are responsible for ensuring the company’s competitive advantages and long-term survival despite strong competition in the global market. The company faces technologically innovative competitors, such as Toyota, Ford, General Motors, Tesla, and BMW. These companies exert significant competitive challenges against the international business growth of Nissan. The company’s generic competitive strategy bolsters business capabilities to withstand these other automakers. On the other hand, Nissan’s intensive growth strategies facilitate business development and expansion to maximize revenues in the international market.
Nissan’s generic competitive strategy and intensive growth strategies need to match industry and market trends to optimize results. For example, these strategies must account for economic and social trends and external factors to satisfy market demand for vehicles. Also, the company needs to fine-tune its competitive strategies and growth strategies to consider stakeholders and their influence on branding, customer perception, and other factors. Nissan’s CSR and ESG strategy for sustainability and stakeholder interests informs management decisions about variables essential for enhancing the company’s competitive and growth strategies.
Nissan’s Generic Competitive Strategy
Nissan’s generic strategy is differentiation, which builds competitive advantages through uniqueness of product features that separate the company from other automakers. Based on Porter’s model, this generic competitive strategy of differentiation prioritizes new, advanced, innovative, or uncommon characteristics that make automotive products more attractive. This competitive strategy aligns with goals for uniqueness, innovation, and value established in Nissan’s mission statement and vision statement. The effectiveness of this generic competitive strategy contributes to business strengths to maximize competitive advantages and long-term potential despite other innovative automakers in the global market.
Cost leadership is a secondary generic strategy that Nissan uses to maintain competitive advantages. Cost minimization and cost-effectiveness are among the main goals of this generic competitive strategy for strengthening the automotive business. Through cost leadership, Nissan achieves low production costs that create opportunities, such as competitive selling prices and the inclusion of new mobility technologies while keeping production within established cost limits. Also, this generic strategy supports financial goals and satisfies investors’ demands and expectations regarding automotive business performance and competitive advantages. The approaches in Nissan’s operations management provide support for this generic competitive strategy, as well as the generic strategy of differentiation.
Nissan’s Intensive Growth Strategies
Product development is Nissan’s primary intensive growth strategy. Based on Igor Ansoff’s matrix, product development focuses on offering new automotive products to generate more revenue. For example, Nissan introduces new car models to increase sales and capture a bigger share of the target market. This growth strategy is challenging because it requires the company to develop products that meet changing needs and customer preferences regarding transportation and mobility. Organizational characteristics, such as the traits of Nissan’s work culture (business culture), determine corporate capabilities for understanding industry and market trends and how these trends are applied in product design to achieve success with this intensive growth strategy of product development. The uniqueness and innovation objectives of the company’s generic competitive strategy of differentiation are followed in automotive product development.
Market penetration also supports Nissan’s business growth. As a secondary growth strategy in this case, the goal of market penetration is to expand the automotive business to capture a larger market share and generate more revenue. Nissan’s marketing mix (4Ps) involves strategies and tactics that determine the success of market penetration. For example, promotional tactics influence customers’ tendency to purchase new cars from the company’s dealerships. Moreover, the places and distribution strategy used for Nissan automobiles affect how the business reaches its target buyers. To achieve success in implementing this intensive growth strategy of market penetration, the company needs effective approaches to growing its market presence and reaching more customers. Market penetration benefits from product attractiveness based on the uniqueness and innovation resulting from the application of Nissan’s generic competitive strategy of differentiation.
Diversification is an insignificant growth strategy in Nissan’s current strategic direction. Even though the company has the financial capacity and technological capability to diversify, its operations remain focused on automotive products. New business endeavors based on this intensive growth strategy typically come with new organizational groups, departments, or divisions that can alter Nissan’s organizational structure (company structure) and organizational design.
Market development is also an insignificant growth strategy in Nissan’s business. The goal of this intensive growth strategy is to develop novel applications of the company’s current automotive products, or to gain new customers, such as in new geographical regions. However, Nissan already has an extensive network of dealerships. Also, the company continues its focus on mobility and transportation, with research and development investments aiming for new automobiles and automotive technologies. Thus, Nissan does not rely on market development as an intensive growth strategy.
References
- Leppänen, P., George, G., & Alexy, O. (2023). When do novel business models lead to high performance? A configurational approach to value drivers, competitive strategy, and firm environment. Academy of Management Journal, 66(1), 164-194.
- Nissan Midterm Plan History.
- Nissan Motor Corporation – Innovation.
- Nissan Motor Corporation Business Plan: The Arc.
- Nissan’s Beginnings.
- Yeung, G. (2024). Competitive dynamics of lead firms and their systems suppliers in the automotive industry. Environment and Planning A: Economy and Space, 56(2), 454-475.