IDEAS home Printed from https://ideas.repec.org/a/bla/jomstd/v56y2019i7p1452-1481.html
   My bibliography  Save this article

Follow the Crowd or Follow the Trailblazer? The Differential Role of Firm Experience in Product Entry Decisions in the US Video Game Industry

Author

Listed:
  • Hakan Ozalp
  • Tobias Kretschmer

Abstract

Firms take cues from their external environment under uncertainty and imitate the actions of others. However, a firm’s own experience may either substitute for these external clues because the firm can evaluate uncertain situations more accurately, or it may complement them because the firm can act more successfully on the external cues. We argue that the type of external cues determines which of the two holds in the context of product entry decisions into market niches. If firms observe a large wave of entrants, own experience conveys more information than the imprecise signal of a mass of other firms. Conversely, if firms observe trailblazers, i.e., highly successful and influential products in a niche, own experience can help firms develop a strategy as a fast follower in a growing niche. We expect the supporting role of own experience in following trailblazers to be especially pronounced in niches that have not been discovered by a large mass of other firms. We study and test our hypotheses in the context of the US PC video game industry between 1991 and 2010 and find support for both the substitutive relationship between own experience and niche popularity and the complementary relationship of own experience and niche trailblazers. However, support for the complementary relationship is limited to less populated niches.

Suggested Citation

  • Hakan Ozalp & Tobias Kretschmer, 2019. "Follow the Crowd or Follow the Trailblazer? The Differential Role of Firm Experience in Product Entry Decisions in the US Video Game Industry," Journal of Management Studies, Wiley Blackwell, vol. 56(7), pages 1452-1481, November.
    • Handle: RePEc:bla:jomstd:v:56:y:2019:i:7:p:1452-1481
    DOI: 10.1111/joms.12389
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/joms.12389
    Download Restriction: no
    File URL: https://libkey.io/10.1111/joms.12389?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yanjie Wu & Sujuan Wang, 2021. "Sustainable Market Entry Strategy under a Supply Chain Environment," Sustainability, MDPI, vol. 13(6), pages 1-15, March.
    2. Gerges-Yammine, Rand & Ter Wal, Anne L.J., 2023. "Firm exit from open multiparty alliances: The role of social influence, uncertainty, and interfirm imitation in collective technology development," Research Policy, Elsevier, vol. 52(4).
    3. Tobias Kretschmer & Aija Leiponen & Melissa Schilling & Gurneeta Vasudeva, 2022. "Platform ecosystems as meta‐organizations: Implications for platform strategies," Strategic Management Journal, Wiley Blackwell, vol. 43(3), pages 405-424, March.
    4. Dharmani, Pranav & Das, Satyasiba & Prashar, Sanjeev, 2021. "A bibliometric analysis of creative industries: Current trends and future directions," Journal of Business Research, Elsevier, vol. 135(C), pages 252-267.
    5. Wang, Yong & Yao, Xiaotao & Li, Kaige, 2022. "Imitation and rapid internationalization of emerging market firms," Journal of World Business, Elsevier, vol. 57(6).
    6. Joost Rietveld & Joe N. Ploog, 2022. "On top of the game? The double‐edged sword of incorporating social features into freemium products," Strategic Management Journal, Wiley Blackwell, vol. 43(6), pages 1182-1207, June.
    7. Sean T. Hsu & Susan K. Cohen, 2022. "Overcoming the Incumbent Dilemma: The Dual Roles of Multimarket Contact During Disruption," Journal of Management Studies, Wiley Blackwell, vol. 59(2), pages 319-348, March.
    8. Ramya K. Murthy & Anoop Madhok, 2021. "Overcoming the Early‐stage Conundrum of Digital Platform Ecosystem Emergence: A Problem‐Solving Perspective," Journal of Management Studies, Wiley Blackwell, vol. 58(7), pages 1899-1932, November.
    9. Saeed Khanagha & Shahzad (Shaz) Ansari & Sotirios Paroutis & Luciano Oviedo, 2022. "Mutualism and the dynamics of new platform creation: A study of Cisco and fog computing," Strategic Management Journal, Wiley Blackwell, vol. 43(3), pages 476-506, March.
    10. Camerani, Roberto & Corrocher, Nicoletta & Fontana, Roberto, 2020. "It's never too late (to enter)… till it is! Firms’ entry and exit in the digital audio player industry," Technological Forecasting and Social Change, Elsevier, vol. 153(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jomstd:v:56:y:2019:i:7:p:1452-1481. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0022-2380 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.