The Quality Choice Of The Entry Of A New Product Into A Vertically Differentiated Market

While discusses enter, the traditional method is a discussion to reign how the enterprise use the scale economy or absolute cost advantage or the product difference advantages or capitalists to request to obstruct latent entrant to enter the market. But this text angle chooses from the quality, discusses how the latent entrant chooses to the quality into the market, and gives the quantitative relation of the quality choice. Under the condition of consistence to the consumer's preference sequence of the characteristics of the product, this text analyzes the strategies of the quality choice of the entrant according to the present quality lever of the incumbent. In a word, this text lays much emphasis on resolving quality choice of the entrant in a vertically differentiated market.First, under the condition of taking no account of the cost, this text gets six kinds of quality designs such as the medium quality, the lower quality and the higher quality. Because having no consideration of the cost factor, the conclusion seems no meaning. In fact, as regards the entrant, if the enterprise seeks for long-term development, then its initial mission should consider, how to raise the fraction the market of the product. Therefore, the textual analysis has the certain leading meaning to the production of the entrant decision.What's more, in consideration of the cost of enter and quality, this text mainly discusses two problems. At first, it discusses how the incumbent chooses the certain quality lever that deters entry. Secondly, it discusses how the entrant formulates the...