Syllabus: AQA - AS and A Level Business
Module: 3.8 Choosing Strategic Direction (A-level Only)
Lesson: 3.8.2 Strategic Positioning: Choosing How to Compete

Introduction

This lesson supports the AQA A-level Business specification, specifically section 3.8.2 Strategic Positioning: Choosing How to Compete. It sits within the broader theme of Choosing Strategic Direction and challenges students to evaluate how businesses develop sustainable competitive advantages in fast-changing markets.

This content is vital for deepening commercial awareness and is mapped directly to the decision-making and strategic evaluation strands of the AQA course. It provides rich opportunities to explore not just exam theory but also real-world workplace readiness, helping students bridge the gap between academic understanding and practical business thinking.

Key Concepts

Students must understand:

• The basis of competition: Businesses compete on benefits offered (e.g. product features, service levels, brand reputation) and/or price.

• Porter’s Generic Strategies:

  • Cost Leadership – Competing by offering the lowest price through operational efficiency.

  • Differentiation – Competing by offering unique products or services valued by customers.

  • Focus Strategy – Targeting a niche segment using either cost or differentiation advantages.

• Influences on Positioning Strategy:

  • Internal capabilities (resources, cost base, innovation capacity)

  • Market conditions (customer needs, competition, economic factors)

  • External pressures (technological change, regulation)

• Sustainability of Competitive Advantage:

  • How businesses defend their position against rivals

  • The risks of being “stuck in the middle” (failing to commit to cost or differentiation)

These concepts link directly to business model thinking, market analysis, and strategic planning—essential competencies for both exams and employment readiness.

Real-World Relevance

Strategic positioning is not just theory. Consider:

• Aldi vs Waitrose: Aldi’s cost leadership model focuses on streamlined supply chains and private label products. Waitrose uses differentiation—service, ethical sourcing, and premium quality—to justify higher prices.

• Ryanair vs British Airways: Ryanair competes on cost with no-frills service and rapid turnaround times. British Airways offers a differentiated experience, especially in business and first-class travel.

• Netflix’s original content strategy: Originally a cost-based disruptor, Netflix now invests heavily in differentiated, exclusive content to defend its market position.

These examples illustrate the practical decisions businesses face when positioning for competitive advantage—decisions students will analyse in exams and encounter in the workplace.

How It’s Assessed

This topic is typically assessed through long-answer, evaluative questions, including:

• 20-mark essays that require applied analysis of strategic positioning in given contexts

• Data response questions incorporating real business scenarios

• Use of command words such as:

  • Assess, Evaluate, Justify, Analyse, Recommend

Assessment Objectives covered include:

• AO2: Application of knowledge to business contexts

• AO3: Analysis of business information

• AO4: Evaluation and reasoned judgements

Students must move beyond definition to critical evaluation, often needing to assess whether a strategy is sustainable or recommend a better alternative.

Enterprise Skills Integration

Strategic positioning directly develops decision-making and problem-solving skills as students:

• Interpret business data to recommend competitive strategies

• Evaluate risk and uncertainty in different approaches

• Justify decisions based on evidence and market dynamics

These capabilities map to Enterprise Skills’ thematic framework in:

• Commercial Awareness: Understanding how firms compete to create value

• Decision-Making & Problem-Solving: Evaluating strategic options under constraints

• Workplace Readiness: Developing analytical thinking applicable in business roles

Enterprise Skills’ simulation tools can enhance these capabilities through live, scenario-based challenges where students act as decision-makers under pressure.

Careers Links

This topic aligns closely with Gatsby Benchmarks 4, 5 and 6:

• Benchmark 4 – Curriculum linked to careers:

  • Students learn how strategy impacts business roles across marketing, operations, and finance.

• Benchmark 5 – Encounters with employers:

  • Real case studies from employers show how strategic decisions play out in industry.

• Benchmark 6 – Experiences of workplaces:

  • Simulations offer first-hand experience of competitive strategy in action.

Relevant career paths include:

• Management consulting

• Product management

• Strategic planning roles

• Marketing strategy analysts

• Business development executives

Each requires the ability to evaluate competitive environments and make informed strategic choices.

Teaching Notes

Suggested Activities

• Mini Case Study Debate: Present two companies (e.g. Lidl vs M&S). Students argue which strategy is more sustainable and why.

• Strategic Positioning Mapping: Use a 2×2 matrix to map brand positions on price vs benefits.

• Simulation Extension: Use Enterprise Skills’ tools to simulate choosing a market position for a fictional product line.

Common Pitfalls

• Students often conflate cost leadership with low quality. Clarify that cost leaders can still deliver value.

• Misunderstanding that businesses must choose either cost or differentiation—some hybrid strategies can exist, but with risk.

• Overuse of generic phrases like “better service” without explaining how this creates competitive advantage.

Exam Technique Tips

• Always apply theory to the business in the case study—don’t just define.

• Use real-world examples to strengthen evaluation.

• Prepare students to critically assess strategy sustainability under changing conditions (economic downturns, new entrants, tech disruption).