4. Win Through High Market Share
4. Win Through High Market Share
Generally speaking, market share leaders make more money than their lamer competitors. They enjoy scale economies and higher brand recognition. There is a "bandwagon effect," and first-time buyers have more confidence in choosing the company's products. But many high market share leaders are not that profitable. A & P was America's largest supermarket chain for many years and yet made pathetic profits. Consider the condition of such giant companies as IBM, Sears, and General Motors in the 1980s, a time when they were doing more poorly than many of their smaller competitors
.
Generally speaking, market share leaders make more money than their lamer competitors. They enjoy scale economies and higher brand recognition. There is a "bandwagon effect," and first-time buyers have more confidence in choosing the company's products. But many high market share leaders are not that profitable. A & P was America's largest supermarket chain for many years and yet made pathetic profits. Consider the condition of such giant companies as IBM, Sears, and General Motors in the 1980s, a time when they were doing more poorly than many of their smaller competitors
.
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