First Mover vs Late Mover Essay
Robert F Murphy
This paper assumes the role of a member of a team of managers wanting to know how to go about introducing a new product. The paper will discuss if it is better to use a late-mover theory or a first-mover theory through the use of positives and negatives of each which will be supported by examples of sixteen companies. Finally, a decision will be made as to which style should be used and why.
Introduction Within this paper the late mover theory and the first mover theory will be defined. Once they are both defined each one will be shown to have advantages as well as disadvantages. All of these advantages and …show more content…
The first advantage of the “First-mover” theory is the ability to gain market share and position in the best locations. When a company is the first to enter the marketplace, they can choose when and where to place the product or service thereby causing everyone else that follows to move around them. Gaining customer loyalty will also be a major benefit. This is due to human nature where people want to stick with their first choice. Furthermore, it is sometimes believed (falsely at times) that the original creator of a product has the best version of the product. People will stick to that creator from the day the item comes out to the public. The corporation will also gain new knowledge of critical success factors and issues because the feedback will be instant and will deal only with their product or service. Finally, being a “First-mover” will give the corporation the view as being an innovator or someone that is at the forefront of the industry. This view will further allow for more customer loyalty.
While “First-mover” has advantages, it also has some disadvantages which are essentially the mirror of the advantages. While the corporation has the ability to gain a high market share and position themselves in the best locations, the cost will be great. The corporation is breaking into a new market which will