Final answer:
Alli Webb found a niche in the market for hair styling by opening Drybar, a salon focused on blowouts. Her keen observation (entrepreneurial alertness), a deeper understanding of customer needs (information asymmetry), and leveraging her social network for promotion all contributed to her success.
Step-by-step explanation:
Alli Webb identified the opportunity to create a specialized salon that focused solely on blowouts, which catered to women wanting a quick and affordable way to get their hair professionally styled without paying for a full cut or color service. Webb's entrepreneurial alertness allowed her to recognize a gap in the market and satisfy a specific need.
Information asymmetry played a role in her business model because she understood women's desire for accessible and consistent blowout services more than existing salons, which provided a wide range of treatments. Furthermore, social networks shaped her success by allowing her to spread the word about her new concept, initially called Drybar, and build a client base through word-of-mouth and social media marketing.
Within the context of the labor market, asymmetric information often exists because employers have limited knowledge about the traits and quality of potential employees and vice versa. Employers look for signals, such as qualifications, work experience, and references, to gauge the potential fit of a new hire.