Dansk Designs, Ltd. :: essays research papers

Dansk Designs Ltd., founded in 1955, is a society that markets stainless steel flatware. The firm traditionally followed a strategy of differentiation. They produce high quality products for the top of the t suitable. Their goal was to reach a small market segment, which consisted of upper class, prestigious customers. Dansk Designs wanted to snitch the concept of the Dansk brand, and believed their consumers would purchase the Dansk products because of the prominent brand name and because the products were the very best in taste and quality. Ted Nierenberg, the founder of Dansk Designs has recently decided that he wants to keep Dansk growing at 15% to 20% per twelvemonth. Nierenberg feels as if his current product line will not provide sufficient growth to meet his objectives, and believes it is in the companys best interest to introduce a new line of house ware products called Dansk Gourmet Designs Ltd. Nierenberg believes they should market this new line to a much wider group of consumers at competitive prices. However, I believe that although expanding into a new market with a new product line will increase short-term revenues, in the long run it will be detrimental because the new line will dilute the brand identity of Dansk Designs. If Nierenberg wants to grow every year 15% to 20%, I believe he should consider ways to lower costs instead of increasing volume and revenues.Traditionally, Dansk Designs followed a strategy of differentiation. When a firm follows this strategy, they create differences in the firms product or service by creating something that is perceived as unique and valued by customers. distinction can take many forms, including prestige or brand image, which Dansk decided to implement. Their product line consists of eight product categories, which include flatware, china, linen, glass, decorator cookware, and wooden bowl and trays. Their products are of high quality and are highly priced. Dansk was able to achieve a differentiation advantage because their price premiums exceeded the extra costs of being unique. Dansk is able to create these unique products because of the talented designers they employ, including Jens Quisrgaard, Niels Refsgaard, and Gunnar Cyren. Another competitive advantage of a strategy of differentiation is the ability to deal with supplier power. There is a current amount of status associated with being the supplier to a producer of differentiated products. Dansks principal supplier, Richard Nissen, has enjoyed working with Dansk because he believes they have been able to preserve the handcrafted temper of the products.