Market Entry and Exit Coursework Example | Topics and Well Written Essays - 750 words

Market Entry and Exit - Coursework Example Body The factors that influence market entry timing include demand of the product and the technological advancements that are related to the product. Whenever a new product is being launched, questions regarding the success of the product suffice. These questions include: what is the main purpose of the product or what need will the product satisfy, what are the features of the product that differentiates it from other products that are already available in the market (Schmoch, 2006). These questions revolve around the economics topic of Demand and Supply. The analysis of launching the product that takes place before the product is actually launched, involves discussion about: the substitute and the complementary goods available in the market of the product, and what segment of the market will be attracted by the product and whose demand will the product satisfy. When a product or service is launched into a market, consumers do not start purchasing the product right away and the prod uct does not capturers the entire target market in a very short period of time. Consumers need time to learn about the product and gain confidence in the product. Each product has a learning curve; this learning curve shows how well consumers have understood the product and how many consumers have understood the options and needs that the product satisfies. ... found it difficult to carry these bottles everywhere in their hands, thus a need for a smaller size bottle existed, Coke realized this need and introduced 300ml bottles which satisfied the existing needs of the consumers. As soon as the product is available in the market and consumers have learned about the product and have started using the product, the producers understand what the concerns that consumers have regarding the product are and they change the product accordingly to make it more acceptable among the target market. Another key element that is attached with the timing of entry in the market is the competitors. Competitors start entering with the same kind of new product as soon as they understand the nature and design of the product, they make certain changes to the product to differentiate their products from the existing product and then they launch their own product in the market (Miles, 2011). How fast competitors will enter the market depends on the product itself. I f the technology used to create the product is easily available, is inexpensive and the cost of switching to this new technology is low, then competitors will easily enter the market with their competitive edition of the product. On the other hand, if the product requires very expensive technology, high amount of investment and the switching cost to a new technology is high, the competitors will experience difficulty in creating a new product and their entry will be delayed. As long as competitors do not enter the market, the producer of a new product can maximize profits and have enough time to implement hurdles to stop the competitors from entering the market. Once the competitors enter the market, the consumer choices increase. Thus the profitability of the producer that has first come