Thursday, November 12, 2015

Loss leaders in the computer hardware markets

The author of this article argues that firms selling computer hardware must focus on capturing market share early in the product life cycle and that doing so requires the firms to sell at a loss in early phase. He argues that decreases in costs will make the product profitable in later phases and that the profit gained then from the market share gained when then produce was a loss leader will more than make up for the early losses.

One question: What keeps price or market share from falling in the later phases?

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.