A competitive strategy to be the low-cost provider in an industry works well when
A) price competition among rival sellers is especially vigorous.
B) commodity-based product prevails and minimal differentiation exists.
C) buyers incur low costs in switching their purchases from one seller/brand to another.
D) industry newcomers use low introductory prices to attract buyers and build a customer base.
E) All of these.

Question

Quizplus · Accepted Answer

A low-cost strategy works well when there is price competition among rival sellers, when the product is a commodity with minimal differentiation, and when buyers incur low switching costs. Additionally, this strategy can help deter new entrants who may use low introductory prices to attract customers and build a customer base. Therefore, all of the options are correct.

A Competitive Strategy to Be the Low-Cost Provider in an Industry