8. Win Through Entering High Growth Markets
8. Win Through Entering High Growth Markets
High growth markets such as solid-state electronics, biotechnology, robotics, and telecommunications have the glamour. Some market leaders have made fortunes in those industries. But the average firm entering a high-growth market fails. One hundred new software firms start up in an area, such as computer graphics, and only a few survive. Once the market accepts some firm's brand as the standard, that firm begins to enjoy increasing volume and returns. Microsoft's Office has become the standard, and other good alternatives have been shuttled aside. An added problem is that products become obsolete very fast in these fast-growing industries, and each company must invest continually to keep up. They hardly recoup their profits from their last offering before they have to invest in developing its replacement
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High growth markets such as solid-state electronics, biotechnology, robotics, and telecommunications have the glamour. Some market leaders have made fortunes in those industries. But the average firm entering a high-growth market fails. One hundred new software firms start up in an area, such as computer graphics, and only a few survive. Once the market accepts some firm's brand as the standard, that firm begins to enjoy increasing volume and returns. Microsoft's Office has become the standard, and other good alternatives have been shuttled aside. An added problem is that products become obsolete very fast in these fast-growing industries, and each company must invest continually to keep up. They hardly recoup their profits from their last offering before they have to invest in developing its replacement
.
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