Comments on: Businesses venturing into unrelated fields

By: Bes

Bes — Tue, 26 Sep 2006 23:35:47 +0000

Good point. Xbox and Zune are great examples of this.

By: Michael Yim

Michael Yim — Sun, 27 Aug 2006 22:02:46 +0000

One example that I can think of is arguably Microsoft. It has a known reputation of expanding horizontally into new markets. First the Xbox, then search engine and now the Zune MP3. Although some of its efforts could be considered successful, I personally believe that when they expand horizontally like that, company resources are lost for its core specialalities, i.e. Operating Systems. I’ve read pretty bad reviews on their upcoming Windows Vista OS. Aparently a lot of people think that it’s an improvement from XP, but not nearly as good enough for 5-6 years of development.

By: Bes

Bes — Sun, 27 Aug 2006 03:42:24 +0000

Michael, you have an interesting point regarding the neglection of certain portions of the customer base.

By: Michael Yim

Michael Yim — Sat, 26 Aug 2006 22:41:23 +0000

I personally believe that it’s not necessarily a bad thing for companies to expand into other territories as long as they can stay connected with their customers and their needs. However, I can see that there is always a risk of expanding too agressively and thus neglecting a certain fraction of the customer base.

By: Bes

Bes — Fri, 25 Aug 2006 09:43:39 +0000

Jerine, maybe your professor was using my notes as a guideline?

Yes, the clash is inevitable, and one or the other has to come on top in the end. Good point using piece of land and secret ingredients. Regarding secret ingredients, those give companies an edge over competition, and thus allows them to be innovative and in control at the same time in their respective territories.

By: jerine

jerine — Tue, 15 Aug 2006 19:54:29 +0000

Reading this feels like the time when I was studying Economics in American Degree Programme.
Anyway, I don’t think it is a bad thing for business venture as long as they provide what the consumer wants. but the main problem always clashes - company for maximum profits, consumer for low price. because of the goal that companies are trying to maximize their profits, they engage in business venture.
i dont think theres any negative effect for business venture if the business are incidental. for example, a toothpaste company decided to venture with a tootbrush company. in that way, it enhance the quality of the product.
however, like gillette combining with duracell…i’ll see it more like avoiding competition.
business field is like a piece of land to me. everyone is trying to expand its empire. so if you venture with another territory, your power will be more influencial. therefore, i can say that currently, companies are only venturing for the sake of expanding their territories.
on the other side, i notice that a company with secret ingredient will never venture with any other company.