A firm's differential advantage of being a low-cost provider may be appealing to one target market (economical consumers who are concerned primarily with price) but undesirable to another target market (status-conscious consumers who are concerned with customer service and store atmosphere).

Question

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Different target markets have varying preferences and priorities, so a low-cost strategy that appeals to price-sensitive consumers may not attract those who value premium service and exclusivity, indicating that a firm's differential advantage can be perceived differently across market segments.

A Firm's Differential Advantage of Being a Low-Cost Provider May