Question: How do companies handle competition?

Sample Answer (The AREA technique):

Answer: Companies handle competition by differentiating their products or services, investing in innovation, and focusing on customer satisfaction.

Reason: Differentiation allows companies to stand out from their competitors by offering unique value to customers, while innovation ensures they stay ahead of industry trends. Prioritizing customer satisfaction helps build brand loyalty and positive word-of-mouth.

Example: Apple has been successful in handling competition by offering high-quality products with a focus on design and user experience, which has allowed them to command premium prices and maintain a loyal customer base.

Alternative: Additionally, companies can handle competition through strategic partnerships or acquisitions, diversifying their product portfolio, or targeting niche markets to establish a strong position in specific segments.