Question

Navi-devices Inc., a manufacturer of portable navigation devices, provides free traffic updates and identifies the nearest parking spaces available with its latest device. It accomplishes this by using GPS coordinates of subscribers and traffic data from radio stations. Which of the following is the most likely impact of this strategy?

a. It will improve the company's operations management.
b It will improve their customer relationship management.
c. It will lower their total revenue.
d. It will provide the company with a competitive advantage.

Answer 1

Navi-devices Inc.

The most likely impact of this strategy is:

d. It will provide the company with a competitive advantage.

Step-by-step explanation:

The strategy of "providing free traffic updates and identifying the nearest parking spaces for its subscribers" will greatly benefit the company's customers. These free services lower the cost for customers and provide an advantage for the company to reach out to more loyal subscribers for its portable navigation devices. However, competitive advantages are not everlasting. They can easily be copied by competitors. This will level the advantage to zero. This implies that Navi-devices must innovate to remain competitive.