FunText Is a Company That Owns an App Used for Text

question 16

Multiple Choice

FunText is a company that owns an app used for text messaging. It recently offered a membership extension of six months without any additional charges to its existing customers who had registered for a three-year membership. By doing this, which competitive strategy did FunText implement?

• A) creation of a new service
• B) product differentiation
• C) locking in customers
• D) locking in suppliers

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Definitions:

Firm's Profits

The financial gains a firm obtains after deducting all expenses, taxes, and costs from its total revenues.

Financial Capital Markets

Marketplaces where individuals and institutions can trade financial securities, commodities, and other fungible assets.

Savers

Individuals who allocate a portion of their income towards savings, either in cash, bank deposits, or other forms of investment, for future use.

Investors

Individuals or entities that allocate capital with the expectation of receiving financial returns.