Alpha Systems, a market leader in high-end video games, has designed its products such that it is difficult for the consumers to migrate to a rival. Which of the following is true about this scenario?
A) Alpha Systems will have low switching costs.
B) Alpha Systems has focused on creating customers who are "butterflies."
C) Alpha Systems has created customers who are "barnacles."
D) Alpha Systems is likely to reduce its staying power in this market.
E) Alpha Systems has focused on reducing "friction" for its end users.

Question

Quizplus · Accepted Answer

Alpha Systems has designed its products such that it is difficult for the consumers to migrate to a rival, indicating that the company has focused on creating customers who are "barnacles." These customers are loyal and stick with the company, even if there are other options available. This means that Alpha Systems has high switching costs, as customers would be reluctant to switch to a rival.

Alpha Systems, a Market Leader in High-End Video Games, Has