MNGT350
Chapter
3 Homework

Yuwei Zhang, Han Yang

September 15, 2014 1. Review the principles of competitive advantage in Figure 3-7. Which types of competitive advantage has BOSU used to defeat copycat products?
Answer: BOSU has used some types of competitive advantages to defeat copycat products such as creating new products, locking in customers and buyers, establishing alliances with trainers and raising market entry barriers. 2. What role did information systems play in your answer to question 1?
Answer: Information systems play a significant role in BOSU’s success. BOSU uses database for email and postal correspondence so that it can create and maintain a close relationship with customers. This information system helps BOSU lock in customers, establish alliances, raise market entry barriers and reduce costs. By using Fitness Quest of trainer data, BOSU develops a crucial marketing strategy and gets a big success. 3. What additional information systems could Fitness Quest develop to create barriers to entry to the competition and to lock in customers?
Answer: There are many ways that could be used to create barriers to entry to the competition and to lock in customers. One way Fitness Quest can use is enhancing the products by using the information system. Fitness Quest can provide a chat room for BOSU buyers to express their opinions and feelings about BOSU trainers. Also, customers can track the specific workout information and share their fitness data to others in order to create a friendly competition. Furthermore, this way can build up the relationship between customers and trainers.
4. In the beginning, Fitness Quest had alliances with trainer sand its main competitor had alliances with major retailers. Thus, both companies were competing on the basis of their alliances. Why do you think Fitness Quest won this competition? To what extent did its success in leveraging relationships with trainers depend on information systems? On other factors?
5. The case does not state all of the ways that Fitness Quest uses its trainer database. List five applications of the trainer database that would increase Fitness Quest’s competitive position. Answer: a. Set up daily fitness goal for customers to accomplish.
b. Send remind messages to customers to remind them to do exercise.
c. Build up connections with others (friends) to do friendly competition though sharing fitness data.
d. Make relative diet plans for customers according with their fitness situation.
e.
6. Describe major differences between the BOSU product and the Indo-Row product. Consider product use, product price, customer resistance, competition, competitive threats, and other factors related to market acceptance. Answer：BOSU product and Indo-Row product are totally different products. BOSU focus on balance whereas Indo-Row concentrates on calorie burning (work out). Compares with the price, Indo-row is more expensive than BOSU. The price of Indo-Row is ten times higher that the price of BOSU. Those two products have their own specific functions and both two products will be chose according to customers’ needs. There are many products which are similar to Indo-Row in the fitness equipment market, but BOSU doesn’t have much competitors because this product is new and innovative. Thus, compared with Indo-Row, BOSU does well to deal with the competition. What is more, BOSU will be easier to accept because it has advanced information system to establish alliances, raise market entry barriers and get connection with customers.