Question

14. What are competitive and first-mover advantages?

Answer 1

Competitive advantage:

Competitive advantage allows an entity or organization to produce goods or service at lower price in a more desirable manner when compared to other market rivals. This allows in generating more sales and more profits when compared to others. Competitive advantage is influenced by various factors such as quality of product offering, branding, cost structure, the distribution network and the customer service. it creates more value to the firm and to its shareholders’. The two main types of competitive advantage are comparative advantage and differential advantage.

First mover advantage:

It refers to advantage gained by a company for first introducing the product or service into the market. First mover advantage helps company to establish product loyalty and strong brand recognition before other entrants. It is helpful only to the large companies that moves into market

This will be helpful to create a strong impression that leads to brand recognition and brand loyalty.