Introduction
Business promotion in the IT industry depends on several nuances and conventions. Effective development in this sector implies productive and sustainable growth, which is challenging to implement in high competition and an insufficiently advanced innovation base. Using individual examples, relevant strategic steps will be considered: raising barriers to new entrants, establishing high switching costs, creating a new product or service, and building alliances. Each of these steps can significantly affect business promotion in the IT industry.
Raising Barriers to New Entrants
Barriers to new entrants can be raised by addressing intellectual property principles. Trademarks and copyrights can help build monopoly power by establishing the dominance of a single brand that defines the relevant service or innovation (“How patents, trademarks, and copyrights create barriers,” 2021). For instance, other firms cannot utilize a proprietary font used by the Coca-Cola Company for any product. This allows Coca-Cola to capitalize on its brand name by expanding brand awareness, thereby increasing customer loyalty and profits.
Establishing High Switching Costs
Establishing high switching costs is a strategic move that can help secure a long-term partnership that could particularly benefit one of the parties. For instance, in the IT industry, suppliers may build relationships with customers so that switching costs are incredibly high, making it difficult to calculate the potential profit from new terms of supply (“Supplier switching,” 2023). A vivid example of such a situation is the model of working with manufacturers selling expensive components for computer equipment. As a rule, a limited number of producers carry out this activity, especially globally. Thus, refusing such a supplier may cost the customer material and reputational costs, which, in turn, is a bonus for the other party.
Creating a New Product or Service
Many companies increase their range of products and services to overcome the competitive barrier, win customer loyalty, enhance brand value, and address other significant business objectives. The main task of such a strategy is to differentiate the existing product line to expand market coverage. An example of the successful creation of new products is the activity of the Chinese corporation Xiaomi. Starting from the manufacturing and selling of smartphones, the company has gradually expanded its production, and today, various household devices, such as robotic vacuum cleaners, TVs, humidifiers, and other valuable goods, are offered to customers (Yang et al., 2021). This principle of development through product line renewals has proven effective and profitable.
Building Alliances
Building alliances allows many IT brands to strengthen their market presence and realize large-scale business objectives. One example is a campaign initiated by Google. Intel, VMware, Zoom, and other major players in the target sector were involved in promoting Chrome as an operating space for enterprise use (Lardinois, 2020). The move helped Google boost product sales and strengthen the company’s brand value.
Conclusion
The strategic moves presented are examples of how individual brands can advance their business in the IT industry. Implementing barriers to entry, increasing switching costs, innovating new products or services, and forming strategic alliances are effective strategies to achieve key development goals and enhance their competitive positions. Achieving customer loyalty and dominance in the target market are the prospects that such steps can help achieve.
References
How patents, trademarks, and copyrights create barriers to entry. (2021). Exy Intellectual Property. Web.
Lardinois, F. (2020). Google, Intel, Zoom and others launch a new alliance to get enterprises to use more Chrome. TechCrunch. Web.
Supplier switching. (2023). Upper Edge. Web.
Yang, H., Ma, J., & Chattopadhyay, A. (2021). How Xiaomi became an Internet-of-Things powerhouse. Harvard Business Review. Web.