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.
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 :
In this attack strategy, the marketer must back it with a stronger attack to beat the opponent. Identify the strategy.
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?
EPRG framework in International Business refers to
The strategies of flanking defense, preemptive defense, mobile defense, contractor defense and counter offensive defense is used by which market player?
(A) Market challenger
(B) Market leader
(C) Market follower
(D) Market Nicher
(E) Start up Marketer
Choose the most appropriate answer from the options given below:
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 ?
