Cost leaders must maintain their marketing or face the possible entry of more cost-effective competitors.Question 8Select one:TrueFalse

Title: Evaluating the Statement

1. Understanding Cost Leadership: Cost leadership is a competitive strategy where a company aims to be the lowest cost producer in its industry. This strategy requires maintaining a strong market presence to deter potential competitors.

2. Analyzing Market Dynamics: If a cost leader reduces or eliminates its marketing efforts, it may lose visibility and brand recognition. This can create opportunities for new entrants who can offer products at a lower cost since there is less awareness or loyalty towards the existing cost leader.

3. Consequences of Inaction: The lack of marketing could lead to a decrease in market share, allowing more cost-effective competitors to enter and succeed in gaining customers who might otherwise have chosen the cost leader.

Conclusion

Thus, the statement is True: Cost leaders must maintain their marketing efforts to fend off potential competition.