Strategic Groups in Retailing Based on Porter’s Generic Market Based Strategies

The first study of strategic groups was conducted by Hunt in 1972. Since then, there have been a number of studies investigating the concept of strategic groups. However, there is still a lot of confusion, and there is very little consensus on a number of issues related to this concept. In particular, issues related to: (1) the definition of the concept of strategic groups, (2) competition between strategic groups, and (3) the relationship between group membership and their performance. This paper attempts to clarify the concept of strategic groups and tries to resolve these issues through a study of the retail sector. The paper then tests four hypotheses and finds support for three of them using data from the retail sector. The results show the existence of strategic groups in the retailing industry using variations of Porter’s three generic strategies.