Brand identification and customer loyalty serve as entry barriers because new entrants not only have to absorb the standard costs associated with starting production in a new industry, but also have to absorb the costs associated with overcoming an incumbent firm's differentiation advantages.

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Brand identification and customer loyalty can serve as entry barriers by making it difficult for new entrants to overcome the advantage of incumbent firms. This is because incumbent firms have already established a reputation and loyal customer base, which can be expensive and time-consuming for new entrants to build.

Brand Identification and Customer Loyalty Serve as Entry Barriers Because