This is a well known startegy and is employed by many companies. However, it is far more difficult than it appears. It requires synergy between operations, finance, and marketing.

Your processes have to be lean, marketing must have intimate knowledge of the early adopters, and you have enough financial resources to start. Once you are successful with a few early wins word of mouth will help defray additional marketing costs.

Topics: ​Advantages become the defacto standard high brand recognition build early loyalty that will make defection harder lock down other players to you, like suppliers create a high cost of switching Disadvantages gaining only early adopters, not the entire market large investment might not provide adequate return competitors learning from your mistakes your offer can be reversed engineered