Question

A financial incentive may cause a consumer to switch to e-commerce; a value-added incentive is designed to:

1) Increase customer loyalty
2) Reduce costs for the consumer
3) Improve the quality of products or services
4) Encourage repeat purchases

Answer 1

1) Increase customer loyalty

Value-added incentives are designed to enhance customer loyalty, encourage repeat business, and ensure product or service quality, contributing to competitive advantages for businesses and overall market growth.

Step-by-step explanation:

A value-added incentive in e-commerce is designed to increase customer loyalty, encourage repeat purchases, and improve the quality of products or services.

These incentives are a way for businesses to differentiate themselves from competitors by offering something extra that adds value to the customer's purchase.

For example, a money-back guarantee can serve as a promise of quality, encouraging customers to feel more confident in their online purchase decisions.

Companies that innovate to create better or less expensive products, as highlighted by executives like Gregory Lee of Samsung, can often stay ahead of the competition temporarily and enjoy higher profits.

Ultimately, this contributes to a cycle where consumers benefit from quality, businesses thrive through increased profits, and the economy grows due to these positive market dynamics.