Businesses have several strategies to respond to the threat of substitutes:
Product Differentiation: Companies can focus on unique features or value propositions to stand out. Cost Leadership: By becoming the low-cost producer, a company can offer competitive prices that make substitutes less attractive. Customer Loyalty Programs: Developing strong relationships with customers can reduce their likelihood of switching to substitutes. Innovation: Continuously improving and updating products can keep them relevant and desirable compared to substitutes.