Question

What are the “weapons of competition” that rival companies in ride-sharing industry can use to gain sales and market share? See Table 3.2 to help you identify the various competitive factors. (the company is UBER)

Types of Competitive Weapons	Primary Effects
Discounting prices, holding clearance sales	Lowers price (P), increases total sales volume and market share, lowers profits if price cuts are not offset by large increases in sales volume
Offering coupons, advertising items on sale	Increases sales volume and total revenues, lowers price (P), increases unit costs (C), may lower profit margins per unit sold (P − C)
Advertising product or service characteristics, using ads to enhance a company’s image	Boosts buyer demand, increases product differentiation and perceived value (V), increases total sales volume and market share, but may increase unit costs (C) and lower profit margins per unit sold
Innovating to improve product performance and quality	Increases product differentiation and value (V), boosts buyer demand, boosts total sales volume, likely to increase unit costs (C)
Introducing new or improved features, increasing the number of styles to provide greater product selection	Increases product differentiation and value (V), strengthens buyer demand, boosts total sales volume and market share, likely to increase unit costs (C)
Increasing customization of product or service	Increases product differentiation and value (V), increases buyer switching costs, boosts total sales volume, often increases unit costs (C)
Building a bigger, better dealer network	Broadens access to buyers, boosts total sales volume and market share, may increase unit costs (C)
Improving warranties, offering low-interest financing	Increases product differentiation and value (V), increases unit costs (C), increases buyer switching costs, boosts total sales volume and market share

Answer 1

Answer: the “weapons of competition” that rival companies can use to gain sales and market share are:

• Lower prices than other firms : which will increase demand for their product in the market
• Marketing: market of the product by providing exciting discount and sale offers. discount coupons and sale offers attract consumers instantly
• Advertising of the product or service : it will increase the reach of the product to the large number of customers and also advertising highlights the specialties and benefits of the product or service which make the product different from the other competitive products. Also seeing the advertising of a product again and again manipulates the mind of customers toward the product.
• Better quality product with improved features: it will increase the demand for the product and also creates a loyal customer base for the product or company.
• Better services to the customers for damage or repair of the product or service: providing better customer care services makes the firm bit different from its competitors which helps to increase their market share and sale of the product  
•   Providing costly products at low financing and improvement in the warranty service of the product: if firm provides high cost products at low financing the consumers prefer to buy that product which increases sale of the product and also the profit of the firm. Also if firm provides warranty on their products for a time period it makes customers to buy the product