Question

10. Two brands of coffee makers, Keurig and Tas- simo, are vying for the convenience market. Keurig is the market-share leader and has the largest variety of cups that are used to make coffees and teas. Tassimo makes a smaller machine that brews faster, but it lacks the variety of coffees and teas sold by Keurig. To complicate matters, Keurig and Tassimo users cannot easily switch from one manufac- turer to the other because the cups that each manufacturer uses are a different size. Which manufacturer is likely to dominate the market in the long run?

Answer 1

The Keurig is likely to dominate the market in the long run. This is because even though their machines are bigger and slower to brew they give their customers more variety when choosing what to drink. Another reason is that in the future Keurig can change its machine to make it smaller and brew faster.