BUSSPP 0020 1st Edition Lecture 12Outline of Last Lecture I. BrandingII. Life Cycle of a Product Outline of Current LectureI. Product Life Cycle (cont) Current LectureI. Product Life Cycle A. -constant to decreasing demand - shrinking profit opportunities Vol. & Rev -toward oligopoly during maturity TimeB. Detail First Mover Advantages: -Location-Key input element-Distribution First Mover Disadvantages: -Incur full value of production/development What do you do if you’re a 2nd mover? -Licensing increases your costs C. Types of second movers 1. Fast a. Sit back, hop in quickly when success is apparent 2. Slow a. We’re not the best, we’ll watch this develop for a while These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute. MatureFirst Moverb. very low risk of failure D. Strategies of Second Movers 1. Advantages of the second mover are much like the disadvantages of the 1st mover, and vice versa 2. Cloning/Price a. something the first mover has done is easily reproduciblei. No intellectual property/copyright b. copy at a lower price 3. Leap-Frogging a. sees a first mover, acquires product, improves product4. Capacity a. Waiting until most of what the target market wants is well understoodb. either keeps price at a medium level or increases it E. Price 1. Demand up, Price up 2. Scarcity of capacity up, Price up 3. Leapfrog = price up 4. Cloning = Price down 5. New entries (increased capacity) = price down Leapfrogging slows
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