SGMT 3000 Lecture Notes - Lecture 7: Duracell, Cost Leadership, Format War
9 May 2016
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Blackberry: supply of compliments not many ppl willing to make apps. Razer and blade strategy: hp sell printers at a loss, try to recoup loss by sale of toner and ink, amazon kindles sold at loss each, entice to download more electronic books. High tech industry uniwue features: format war (bc of dominant design, to win format war -> ensure supply of coplements, leverage killer apps, pursue . For any firm that is the first in the ndustyr, simulateneously experience advantages and also suffer from some disadvantages. Can cultivate network effect ahead fo your rival. Can launch ads to entice custoemrs to develop loyalty to your brand. Can accumulate outputs to achieve economies of scales and learning effect ahead of your rivals. Customers may not be willing to switch (switching costs) Unknown if the technology will be the winning in the format war (may invest in the wrong technology) Extreme failure rate in innovation i. e. netbook.
