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First come, first served: How market and non-market actions influence pioneer market share

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  • Usero, Belén
  • Fernández, Zulima
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    Abstract

    This study examines the relationship between the erosion of first-mover advantages and the competitive behavior of pioneer and follower firms in a service industry--in this case, the European mobile telecommunications industry. The research analyzes the role of market actions related to innovation, pricing and promotion, and non-market actions related to judicial issues. The study finds that first movers enjoy a sustainable market share advantage in this service industry, but that this advantage depends on the type of actions taken by pioneers and followers. Specifically, followers that take more market actions than the pioneer are not able to erode the first-mover's advantage. However, followers taking more non-market actions - such as litigation and complaints - are successful at taking market share from the pioneer.

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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of Business Research.

    Volume (Year): 62 (2009)
    Issue (Month): 11 (November)
    Pages: 1139-1145

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    Handle: RePEc:eee:jbrese:v:62:y:2009:i:11:p:1139-1145

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    Web page: http://www.elsevier.com/locate/jbusres

    Related research

    Keywords: Pioneer advantage Market actions Innovation Non-market actions Legal actions Service industries Telecommunications industry;

    References

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    1. Field, Laura & Lowry, Michelle & Shu, Susan, 2005. "Does disclosure deter or trigger litigation?," Journal of Accounting and Economics, Elsevier, vol. 39(3), pages 487-507, September.
    2. Christina L. Brown & James M. Lattin, 1994. "Investigating the Relationship Between Time in Market and Pioneering Advantage," Management Science, INFORMS, vol. 40(10), pages 1361-1369, October.
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    16. Koku, Paul Sergius & Qureshi, Anique A. & Akhigbe, Aigbe, 2001. "The effects of news on initial corporate lawsuits," Journal of Business Research, Elsevier, vol. 53(1), pages 49-55, July.
    17. Sanjai Bhagat & John Bizjak & Jeffrey L. Coles, 1998. "The Shareholder Wealth Implications of Corporate Lawsuits," Financial Management, Financial Management Association, vol. 27(4), Winter.
    18. Mengze Shi & Jeongwen Chiang & Byong-Duk Rhee, 2006. "Price Competition with Reduced Consumer Switching Costs: The Case of "Wireless Number Portability" in the Cellular Phone Industry," Management Science, INFORMS, vol. 52(1), pages 27-38, January.
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    Citations

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    Cited by:
    1. Muck, Johannes & Heimeshoff, Ulrich, 2012. "First mover advantages in mobile telecommunications: Evidence from OECD countries," DICE Discussion Papers 71, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    2. Wang, Chun-Ju, 2010. "Research on non-market actions: A commentary essay," Journal of Business Research, Elsevier, vol. 63(8), pages 905-907, August.
    3. Kunz, Werner & Schmitt, Bernd & Meyer, Anton, 2011. "How does perceived firm innovativeness affect the consumer?," Journal of Business Research, Elsevier, vol. 64(8), pages 816-822, August.
    4. Jakopin, Nejc M. & Klein, Andreas, 2012. "First-mover and incumbency advantages in mobile telecommunications," Journal of Business Research, Elsevier, vol. 65(3), pages 362-370.
    5. Vázquez-Maguirre, Mario & Hartmann, Andreas M., 2013. "Nonmarket strategies of media enterprises in the Mexican television industry," Journal of Business Research, Elsevier, vol. 66(10), pages 1743-1749.

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