First-mover advantages and innovation success: a contingency approach

Abstract

Purpose The purpose of this paper is to propose an overarching unifying theory where first-mover advantages are a conditional effect, not a main effect. By offering a closer look at how the firm, market and product characteristics influence the supply and demand of innovations, this research furthers our understanding of the advantages and disadvantages for first movers. Design/methodology/approach This paper explores first-mover advantages as a conditional effect. Adopting a contingency perspective, the authors review the literature in marketing, strategic management, innovation and entrepreneurship to offer a conceptual framework putting innovation success at the core of first-mover advantages. The authors develop an inventory of propositions specifying how first-mover advantages depend on various firm features, market characteristics and product properties through their effects on the success of innovations. Findings A conceptual framework centered around innovation success yields testable hypotheses that are coherent with extant research on first-mover advantages and reconcile the seemingly contradictory evidence in that body of work. Practical implications This research provides managers with the opportunity to think about one of the most important decisions, i.e. time of entry, not as a linear finite decision, but instead as a flow with the innovations and potential for their success in mind. Originality/value This paper distinguishes itself from the existing literature with its focus on innovation within a contingency perspective for first-mover advantages.

Why Do SMEs Adopt Artificial Intelligence-Based Chatbots?

“…Therefore, SMEs do not face pressure to follow their competitors in adopting this technology. This result also highlights the advantages of early adoption of AIbased chatbots as a way for small businesses to gain a competitive edge [133].…”

Can entrepreneurial marketing compensate for late market entry? A moderated mediation analysis

“…Although research provides evidence that supports the first-mover advantages, there are contrary findings that the late entrants may show better performance despite less time-in-market [ 5 , 6 , 13 , 39 ]. Ashrafi & Ravasan [ 18 ], Baker et al [ 21 ], and Heiens et al [ 40 ] proposed that marketing efforts may overcome limitations due to later entry timings.…”

“…Early market entry is generally considered a competitive strength in the extant literature linked to achieving a larger market share [ 3 , 4 ]. However, Chavez & Chen [ 5 ] and Gómez et al [ 6 ] contended this dominant view arguing that competitive advantage is not entirely dependent on early market entry as late entrants can equally gain market share by strategically aligning their marketing strategies with market and customer needs.…”

“…However, researchers such as Zachary et al [ 13 ] challenged this view by debating the optimal market entry timing. Further, Chavez & Chen [ 5 ] and Cozzolino et al [ 16 ] argued that both early and late entrants could gain competitive advantages if they possess the necessary skills and competencies and align them with market conditions to offset entry timing advantages. These studies reported that order-of-entry does not necessarily lead to lower market share challenging the dominance of early entrants and suggesting that late entrants who spend less time in the market can equally achieve desired market share.…”

“…The suggestions included effective utilization of firm characteristics [ 18 ], developing a market orientation [ 19 ], and incrementally improving product attributes [ 20 ]. In addition, Chavez & Chen [ 5 ] and Baker et al [ 21 ] proposed several innovation avenues to mitigate late entry disadvantages. The authors explained that late-entrant startups and small firms could vastly reduce late-entry risks through innovation, as late entrants and incumbents rely on innovation to maintain market positions.…”