A low-cost leader can translate its low-cost advantage over rivals into superior profit performance by cutting its price to levels significantly below the prices of rivals, driving high-cost rivals out of business, and then capturing the customers of those companies who exit the industry. going all out to achieve the absolute lowest possible costs of any firm in the industry and then using its cost advantage to underprice rivals and capture a dominant share of the market. outproducing rivals and thus having more units available to sell. either using its low-cost edge to underprice competitors and attract price sensitive buyers in large enough numbers to increase total profits or else by refraining from price-cutting and using its low-cost advantage to earn a bigger profit margin on each unit sold, thereby boosting the firm's total profits and return on investment. spending heavily on advertising to promote its cost advantage and the fact that it charges the lowest prices in the industry--it can then use this reputation for low prices to build very strong customer loyalty, gain repeat sales year after year, and earn sustained profits over the long-term