Question

Which of the following characteristics belong to the low-end disruptive innovation?

• A. It makes food products into better products
• B. It delivers products at lower cost
• C. It targets non consumption
• D. It improves profit margins

Answer 1

The Correct Option is B

Low-end disruptive innovation is a type of innovation strategy that targets the least profitable and most price-sensitive segments of the market. Let's analyze the given options to determine which one fits the characteristics of low-end disruptive innovation:

• It makes food products into better products: This option refers to an improvement in the quality of products, which is generally characteristic of sustaining innovation rather than disruptive innovation.
• It delivers products at lower cost: This is a core aspect of low-end disruptive innovation. Such innovations focus on offering similar products at a significantly lower price, allowing them to capture a share of the market that is price-sensitive. This option is correct.
• It targets non-consumption: While this is related to disruptive innovation, it specifically describes new-market disruptive innovation, where companies create new markets by targeting people who previously did not have the means to buy the product. It is not a specific characteristic of low-end disruption.
• It improves profit margins: Improved profit margins tend to be a feature of premium or sustaining innovations rather than cost-reducing disruptive innovations.

Hence, the characteristic that belongs to low-end disruptive innovation is it delivers products at lower cost. This approach allows new entrants to enter the market by offering a cheaper alternative that appeals to the lower end of the market.