fter studying the third Session Topic entitled 'First Mover Advantage' and also watching a video on the same topic, answer the following questions:
1. What are the advantages of becoming First Movers in business?
Being the first to develop and market a product comes with many prime advantages that strengthen a company's position in the marketplace. For example, a first mover often gains exclusive agreements with suppliers, sets industry standards, and develops strong relationships with retailers. Other advantages include
• Brand name recognition is the main first-mover advantage. Not only does it engender loyalty among existing customers, but it also draws new customers to a company's product, even after other companies have entered the market. Brand name recognition also positions companies to diversify offerings and services. Examples of dominant brand name recognition of a first mover include soft drink colossus Coca-Cola (NYSE: KO), auto-additive giant STP (NYSE: ENR), and boxed-cereal titan Kellogg (NYSE: K).
• Economies of scale, particularly those regarding manufacturing or technology-based products, is a massive advantage for first movers. The first mover in an industry has a longer learning curve, which frequently enables it to establish a more cost-efficient means of producing or delivering a product before it competes with other businesses.
• Switching costs let a first mover build a strong business foundation. Once a customer has purchased the first mover's product, switching to a rival product may be cost prohibitive. For example, a company using the Windows operating system likely would not change to another operating system, because of the costs associated with retraining employees, among other costs.
2. What are the challenges of becoming First Movers?
Despite the many advantages associated with being a first mover, there are also challenges. Other businesses can copy and improve upon a first mover's products, thereby capturing the first mover's share of the market.
Also, often in the race to be the first to market, a company may forsake key product features to expedite production. If the market responds unfavorably, then later entrants could capitalize on the first mover's
3. What does a First Mover do in order to survive the market?
First-mover have to concentrate on how firms achieve them.
The first is by creating a technological edge over competitors. By starting earliest, first movers have more time than later entrants to accumulate and master technical knowledge.
The second way is by preempting later arrivals’ access to scarce assets—for example, a location on a city’s main street, talented employees, or key suppliers.
The third is by building an early base of customers who would find it inconvenient or costly to switch to the offerings of later entrants.
Sumber:
- Materi Sesi 3 Mata Kuliah Bahasa Inggris Niaga
- First Mover Advantage: https://www.youtube.com/watch?v=eDaQcv9mjTI
- First Mover Definition: https://www.investopedia.com/terms/f/firstmover.asp
- The Half-Truth of First-Mover Advantage: https://hbr.org/2005/04/the-half-truth-of-first-mover-advantage
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