A company that pursues low- cost leadership will react much more strongly to a competitor's cost- reducing manufacturing breakthrough than to the same competitor's advertising increase.

Question

Quizplus · Accepted Answer

A company that is pursuing low-cost leadership focuses on reducing costs in order to offer products or services at lower prices than competitors. Therefore, a cost-reducing manufacturing breakthrough by a competitor is a significant threat to the low-cost leader as it can potentially offer similar products at lower prices. On the other hand, an increase in advertising by a competitor does not necessarily impact the low-cost leader's ability to offer products at lower prices.

A Company That Pursues Low- Cost Leadership Will React Much