Question

Entrepreneurship and Effective Small Business Management (11th Edition)

Reading: Vizio: Disrupting Another Market (pg. 124)

What challenges does Vizio face as it attempts to introduce a new line of products into a mature industry?

Answer 1

Challenges faced in a mature market

1. Established players. The mature market would already consist of established and prominent competitors. These competitors would have brand name which is well-known. They would also have detailed knowledge about the market like customer buying habits, distribution network, etc.

2. Customer loyalty: It is difficult to persuade customers who may have developed brand loyalty to switch over to a new brand.

3. Entry cost is high. Promotion and advertisement costs will be very high.

4.Growth opportunities will be limited. A great deal of money has to be spent on research and development of the product.