Gadgetbug, an electronic gadgets company, has established itself as one of the industry leaders. The company has been facing competition from new entrants. The new entrants offer gadgets in different colors, with compelling artwork embossed on the cases. Seeing the interest in this market, Gadgetbug introduced its own range of uniquely designed gadgets. In this scenario, Gadgetbug's attempt to cater to the different segments of customers to deter competition demonstrates:
A) price signaling
B) product proliferation
C) harvest strategy
D) limit price strategy
E) diseconomies of scale

Question

Quizplus · Accepted Answer

Gadgetbug's introduction of a range of uniquely designed gadgets is an example of product proliferation. This strategy involves increasing the number of products offered by a company to cater to different segments of customers and deter competition. In this case, Gadgetbug is trying to differentiate itself from new entrants who offer gadgets in different colors with compelling artwork embossed on the cases. Gadgetbug's unique designs may attract a different set of customers and help the company retain its market share.

Gadgetbug, an Electronic Gadgets Company, Has Established Itself as One