Final answer:
If a competitor uses a similar brand mark and name, a business should differentiate its products and may consider legal action for trademark infringement. Investing in marketing and continuous product improvement are also crucial to maintaining a competitive edge and protecting profits.
Step-by-step explanation:
If a competitor is using a brand mark and a brand name similar to your business's leading private brand, your business might need to take several actions to protect its market share and brand reputation. One strategy is to differentiate your product even further, highlighting unique features or aspects that set it apart from the competition. This is key in monopolistic competition, where product differentiation plays a crucial role. A firm must invest in advertising and marketing to maintain a recognizable brand name, especially in markets leaning towards an oligopoly.
In addition to marketing efforts, your business may consider legal action if the competitor's use of similar branding constitutes a trademark infringement or causes consumer confusion, potentially reducing your profits. Businesses can also innovate by improving their product or introducing new features that competitors do not offer. Such innovation and continuous improvement are essential to stay ahead in a market where firms with better or cheaper products can pose a significant threat.