Definition of First Mover





What does the term "first mover" mean as it applies to the business world? What is meant by the term "first mover"?

In the business world, a "first mover" is a company that is first to a certain market.

Definition of First Mover - Financial Dictionary - IllustrationAn example of a "first mover"? Ebay - the company was one of the first to the online auction market, and therefore gained a "first mover" advantage.

Thanks to being first to the online auction market, Ebay was able to build liquidity and a brand. Anybody can start an online auction business - few companies can actually draw people to their site. By being a first mover, Ebay was able to build up a critical mass of liquidity early on. This "first mover" advantage gained Ebay a stranglehold over the online auction market almost immediately. Try breaking into the online auction market now - Ebay is THE brand in the space, and their site is used by tens of millions of people every day.

Sure, Ebay has made mistakes along the way, but their brand and loyal customers have allowed them to maintain their death grip on the online auction market.




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