Challenges in emerging industry with unique strategy-making

Question

What are the challenges in the emerging industries with some unique strategy-making?

Answer 1

Competing in the emerging industries presents managers with some unique strategy-making challenges:

i. Because the market is unproved and new, there may be much conjecture about how it will function, how quick it will grow, and how large it will get.

ii. Much of the technological know-how underlying the items of emerging industries is closely and proprietary guarded, having been developed in-house by pioneering firms; unique and patents technical expertise are main factors in securing competitive benefit.

iii. Often there is no agreement about which of many competing technologies will win out or which product attributes will proves decisive in winning purchaser favor.

iv. Entry barriers tend to be comparatively low, even for entrepreneurial start-up companies.

v. Powerful experience and learning curve effects may be present.

vi. Since in an emerging industry all purchasers are first-time users, the marketing job is to persuade initial purchase and to overcome consumer concerns about performance reliability, product features, and conflicting claims of rival firms.

vii. Many potential buyers expect first-generation products to be quickly enhanced, so they delay purchase until product and technology design mature.

viii. Sometimes firms have problem securing ample supplies of components and raw materials.

ix. Undercapitalized companies may end up integration with the competitors or being acquired by the financially powerful outsiders looking to invest in an increase market.