Understanding Corporate Cannibalism
corporate cannibalism or market cannibalization occurs when a company releases a new product that depletes the sales of one of its other existing products. for example, meg's cafe is famous for its milk shakes and people come from all over to enjoy them. then one day meg's builds twice the amount of choco into the milk shake. it tastes delicious. meg's decides to market this new recipe as meg's mega milk shakes. as sales for the mega milk shakes increase, meg's notices sales for the original recipe are decreasing. this is because the two shakes are competing against each other. companies may purposely engage in corporate cannibalism to try and increase their market share. they increase the range of products in one area in the hope of crowding out competitor's products. even if the sales of new products ? in the sales of existing ones, the company will still benefit from the cannibalism, as long as their total sales increase compared to their competitor's sales. corporate cannibalism also occurs when a company introduces a new version of a product while the old product is still on the market. however, if the products are too similar, a company may and ? increase production cost without increasing in overall market share. corporate cannibalism is not necessarily bad for a company. the company is simply trying to increase the range of products it offers in order to appeal to consumers within a particular market segment.
- corporate cannibalism・・・？
- market cannibalization・・・？
- milk shake・・・ミルクセーキ
- crowd out・・・～を締め出す