Which strategy focuses on a limited industry niche or customer segment?

The Focused Differentiation Strategy is characterized by targeting a specific niche within an industry or a particular customer segment. This approach involves tailoring products or services to meet the unique needs and preferences of a well-defined group of consumers, which can create a strong competitive advantage within that niche. By focusing on a limited market, businesses can allocate resources more efficiently and develop a deeper understanding of their customers’ desires, leading to higher customer loyalty and potentially commanding a premium price due to specialized offerings.

In contrast, other strategies such as Mass Market Strategy aim to appeal to a broad audience, while Broad Cost Leadership focuses on offering the lowest prices across the entire market. General Differentiation encompasses strategies aimed at making a product or service distinct in the broader market without necessarily targeting a specific niche. These strategic differences highlight why the Focused Differentiation Strategy stands out as the correct choice for the question asked.