This case demonstrates that how a brand differentiates from the category label because brand is something that are used to identify a particular company while category labels are used to differentiate the product which is slightly similar to company’s other existing product. Similar to brand the categories have an impact in ways that are subtle and profound.
The tesla is a brand that has been utilized by the Tesla motors to maintain its prominent standing. However, the “Electric car” is the category label that the company uses to launch its product. Regarding the product usage and meaning, the new industries are characterized by an early period of insufficient knowledge.
The industries that are known today as “cloud computing” had the label of “application service provider”, “utility computing”, and “software as a service” at the time of entrance, decades ago. Samsung had named, one of its products such as smart phone, “camera phone” which was launched in the late 1990s, while others called it a “PDA phone” and Nokia put a name of “gaming deck”.
As in many of the business expert opinions, it creates a lot of opportunities for the company while utilizing the first mover advantage, but it could also be a threat for the company because of inadequate knowledge of challenges hidden in the market.
Introduction of an eminent category label, in a nascent sector, could only open the door of opportunities for the company. It is essential to forecast the growth of the new category label because in most of the time consumers become reluctant to commit a new category label which ultimately generate confusion in the environment for the company and rather capturing the segment the product starts to obsolete.
To avail the opportunities, while availing the first mover advantage the companies have to assure to implement the most appropriate strategy in the product’s promotion. On the other hand, not only the consumer’s need should be fulfilled by the new product design but the company should provide the additional benefit to capture a massive market share.
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