When the total market expands, the _________ usually gains the most.
Market leader
Firms are classified by their competitive position as market leader, challenger, follower or nicher, and the question turns on the arithmetic of market share.
The market leader usually gains the most when the total market expands. The leader holds the largest share of the market, so any given growth in total demand translates into the largest absolute increase in sales for it. If the leader holds, say, half the market and the market grows by a million units, roughly half of that growth accrues to the leader, more than any single rival can capture. This is precisely why expanding total demand - finding new users, new uses and encouraging greater usage - is treated as a core strategy for market leaders, alongside protecting and expanding share.
The market challenger holds a smaller share and its typical route to growth is attacking the leader rather than relying on market expansion. The market follower deliberately imitates rather than leads, so it gains proportionately less. The market nicher serves a small specialised segment, so overall market growth benefits it least of all unless the growth happens to occur within its niche.
Hence when the total market expands, the market leader usually gains the most.
Similar Questions
In this attack strategy, the marketer must back it with a stronger attack to beat the opponent. Identify the strategy.
In this attack strategy, the marketer must back it with a stronger attack to beat the opponent. Identify the strategy.
Which of the following strategy is generally adopted by a market challenger firm ?
Arrange the following steps of Global marketing process in a correct order :
A. Implement the marketing strategy
B. Decide on market entry strategy
C. Monitor and control
D. Identify and evaluate marketing opportunities
E. Develop a marketing program
Choose the correct answer from the options given below :
Important Questions from Strategic marketing planning
How many types of consumer clusters are defined in the VALS framework, which divides consumers according to their buying motivation behavior?
In this attack strategy, the marketer must back it with a stronger attack to beat the opponent. Identify the strategy.
In this attack strategy, the marketer must back it with a stronger attack to beat the opponent. Identify the strategy.
Match the items of List-I with List-II and denote the code of correct matching.
List – I List – II a. Invest Strategy i. No receiving of new resources. b. Protect Strategy ii. Well financed marketing efforts. c. Harvest Strategy iii. Selective resource allocation d. Divest Strategy iv. Not warranting substantial new resources. Codes :
Which of the following strategy is generally adopted by a market challenger firm ?
