I am interested in this blog because I am also a fan of Tim Horton. The reason for it to have strong customer loyalty for decades in such a competitive industry is because of the high quality of services and variety of products it offered. Unique products like Iced Capp as author has mentioned helps Tim Horton to achieve great differentiation and thus avoid the loss from large competition. It seems that the company has much market power in the industry, however, I agreed with the author that the plan of raising price of coffee due to the price hike of beans will still cause the company to lose buyers and eventually lead to a decrease in profits.

To maintain the customer loyalty and keep the company remains profitable, the author has suggested the company to shift from cost leadership strategy to differentiation strategy. It is a very good idea and the company should definitely consider about it; nevertheless, differentiation strategy can also bring some risks at the same time. For example, the products it produce may only be valued by a certain amount of customers. Plus, it is costly and time-consuming for a company to implement this strategy. And before the company can achieve a strong brand image that sets it apart from the competition, the company is also facing the risk of changing consumer tastes. Therefore, in order for the company to proceed a successful differentiation strategy, scientific research is needed. One improvement which the author can make is to suggest different market research methods to the company such as collecting primary data or secondary data from previous researches or directly from the consumer.

In addition to the author’s blog, differentiation-focused strategy is another strategy that the company can adopt. The advantages of this strategy are that the company can enjoy high level of customer loyalty and each of its unique product focuses on only small number of target market segments. As a result, the company is able to ensure that it does meet customer’s needs and wants. Meanwhile, it can create greater differentiation by providing products that are clearly different from competitors who are targeting a broader group of customers. The great differentiation can help the company passes its costs on to the customer without high price elasticity of demand since substitute products are very rare.