Pregunta:
How can advertising be an entry barrier?
Autor: Hjalmer PedersenRespuesta:
Raising entrants’ initial costs: - High advertising expenditures necessary to draw attention to entrants product - Increase the sunk costs of potential competing interest Building reputations effects: - Existing companies may have created brand loyalty, influence consumer tastes by using advertising Economies of scale in advertising: - Cumulative effect of many commercials rounds - Increases sunk costs for potential competitors - Promotional price per minute / cm less
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