A first-mover advantage is valuable under all of the conditions except ________.
A) a firm achieves an absolute cost advantage in terms of scale or scope
B) the scale of a firm's first move makes imitation unlikely
C) first-time customers may move freely among competing products because of new product preferences
D) a firm's image and reputation advantages are hard to imitate at a later date

Question

Quizplus · Accepted Answer

Option C states that first-mover advantage is not valuable when customers can easily switch to other new products in the market, indicating that customer loyalty and lock-in are not present. In contrast, options A, B, and D suggest that the first mover benefits from either an absolute cost advantage, high entry barriers for competitors, or image and reputation advantages that are hard to replicate.

A First-Mover Advantage Is Valuable Under All of the Conditions