In marketing, the first mover advantage is an economic advantage gained by the first major occupant of an existing market segment. Usually, the companies in the industrial segment follow this type of marketing strategy. This has been proven to be beneficial since it drives new entrants and maintains the loyalty of existing customers.
First Mover Advantage in Marketing
It is usually accompanied by cross-selling or packaging that helps increase the number of customers and reduces the cost involved in each sale. Although this is one of the best strategies of marketing for new customers, companies use this in their attempt to gain loyal customers.
The other important term for first-mover advantage in marketing is first-movers’ share this should help you decide. This refers to the percentage of the total sales of the firm that comes from the new entrants.
The larger the number of first-movers, the larger the share of the firm comes from the new entrants. Other terms used in this area of marketing are first marketers fee, freerolls, and larger sell.
A third term that is closely related to first-movers’ advantage in marketing is brand name recognition. This is based on the recognition of the company, its products or services, and its brand name in the targeted market segment.
The larger the brand name recognition, the more profitable the company becomes for its products or services. The other advantage of brand name recognition is that it drives new entrants and maintains the loyalty of existing customers.