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Greate

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Submitted By jsadik
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First movers have significant advantages over their new entrant competitors. The first first-mover advantage is that Jeff was able to establish extreme customer loyalty and secure a significant portion of the market. Even though competitors such as Barnes and Noble and Borders tried to imitate Amazon, Amazon was able to expand its product offerings to retain a majority of the customers. Not only did it offer books, but it also became a one-stop shop for any wants, needs or desires.
Another advantage of being a first mover is that Amazon can reduce buyer power (Porters 5 forces) by controlling the switching costs. Through rewards and discount programs such as free shipping, Amazon has made it expensive to switch to a competitor. Once a customer is enrolled in these rewards programs, the price difference is such that the customer will pay more to switch.
Unfortunatley, there are many disadvantages that come with being a first-mover. Although you can retain a portion of the industry through brand loyalty, there are many customers who choose to wait until products or services have improved. These customers will also wait for competiting businesses to lower costs and are willing to wait out the bugs and problems that first movers often run into. By being a first-mover, it is easy for competitors to see what you are doing right, and where you need to improve. They can easily take this opportunity to create a better business building off of your idea.
The learning curve was steep because this was branching into a whole new world of communication and business to customer opportunities. Not knowing what to expect or what the customer responses were going to be created a number of technical problems that had to be improved upon in order to stay competitive as new entrants flooded the market, hoping to snag some of the profits. Being a first mover, your company has to sort

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