Failsafe Strategies: Profit and Grow from Risks That Others Avoid

Chapter 8. When and How to Use a Low-Price Entry Strategy

An entrant should always consider a differentiation entry strategy if it is at all possible. Differentiation gives the entrant some time before competitive risk becomes a problem. However, under some situations, differentiation is not a good option because the basis for differentiation is not sustainable and the competitive battle quickly becomes one of price. Let us consider some examples.

For a Mature Product, the Entry Strategy Should Be Low Price

Opportunities for differentiation are likely to be less if the product or service has been around for a long time. Even if you manage to develop a basis of differentiation, you are likely to attract the attention of the incumbents. Unless this ...