IDEAS home Printed from https://ideas.repec.org/a/eee/respol/v51y2022i5s0048733322000336.html
   My bibliography  Save this article

Catching up with the market leader: Does it pay to rapidly imitate its innovations?

Author

Listed:
  • Giachetti, Claudio
  • Li Pira, Stefano

Abstract

In this study we attempt to shed more light on the relationship between speed of new technology imitation and the sales performance of the imitator compared to the innovator, with a particular focus on the performance outcomes resulting from the rapid imitation of technologies introduced by the market leader. Using data on handset technologies mounted on more than 600 devices introduced to the UK market by 14 mobile phone vendors operating from 1997 to 2008, we study hundreds of imitative actions to test hypotheses on the extent to which an imitator can catch up (i.e., reduce the market share gap) with the market leader by rapidly imitating its innovations. First, we show that gaining advantage by rapidly imitating a technology pioneer is contingent on whether the pioneer is the market leader or a non-leader rival. Second, we find that the risks of rapid imitation of the market leader's technologies are mitigated when industry clockspeed is high, i.e., during a period of fast innovation and imitation cycles in an industry, resulting in rapid variations in product design. Third, we observe that the degree of competitive responsiveness of the technology pioneer when its innovations are imitated represents an important mechanism that can explain why speed of imitation may affect how an imitator can improve its market share gains relative to the pioneer. This paper advances competitive dynamics and imitation as predictive theories of how rapid imitators might catch up with market leaders in technology-intensive industries.

Suggested Citation

  • Giachetti, Claudio & Li Pira, Stefano, 2022. "Catching up with the market leader: Does it pay to rapidly imitate its innovations?," Research Policy, Elsevier, vol. 51(5).
    • Handle: RePEc:eee:respol:v:51:y:2022:i:5:s0048733322000336
    DOI: 10.1016/j.respol.2022.104505
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0048733322000336
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.respol.2022.104505?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Lee, Keun & Lim, Chaisung, 2001. "Technological regimes, catching-up and leapfrogging: findings from the Korean industries," Research Policy, Elsevier, vol. 30(3), pages 459-483, March.
    2. Yuzhe Miao & Jaeyong Song & Keun Lee & Chuyue Jin, 2018. "Technological catch-up by east Asian firms: Trends, issues, and future research agenda," Asia Pacific Journal of Management, Springer, vol. 35(3), pages 639-669, September.
    3. Kyoo-Ho Park & Keun Lee, 2006. "Linking the technological regime to the technological catch-up: analyzing Korea and Taiwan using the US patent data," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 15(4), pages 715-753, August.
    4. Jens L. Boyd & Rudi K. F. Bresser, 2008. "Performance implications of delayed competitive responses: evidence from the U.S. retail industry," Strategic Management Journal, Wiley Blackwell, vol. 29(10), pages 1077-1096, October.
    5. Gonçalo Pacheco-De-Almeida, 2010. "Erosion, time compression, and self-displacement of leaders in hypercompetitive environments," Post-Print hal-00576341, HAL.
    6. A. Colin Cameron & Douglas L. Miller, 2015. "A Practitioner’s Guide to Cluster-Robust Inference," Journal of Human Resources, University of Wisconsin Press, vol. 50(2), pages 317-372.
    7. Ronald Klingebiel & John Joseph, 2016. "Entry timing and innovation strategy in feature phones," Strategic Management Journal, Wiley Blackwell, vol. 37(6), pages 1002-1020, June.
    8. Sucheta Nadkarni & V. K. Narayanan, 2007. "Strategic schemas, strategic flexibility, and firm performance: the moderating role of industry clockspeed," Strategic Management Journal, Wiley Blackwell, vol. 28(3), pages 243-270, March.
    9. Clayton M. Christensen & Fernando F. Suárez & James M. Utterback, 1998. "Strategies for Survival in Fast-Changing Industries," Management Science, INFORMS, vol. 44(12-Part-2), pages 207-220, December.
    10. Sendil K. Ethiraj & David H. Zhu, 2008. "Performance effects of imitative entry," Strategic Management Journal, Wiley Blackwell, vol. 29(8), pages 797-817, August.
    11. Marvin B. Lieberman & David B. Montgomery, 1988. "First‐mover advantages," Strategic Management Journal, Wiley Blackwell, vol. 9(S1), pages 41-58, June.
    12. Ansari, Shahzad (Shaz) & Krop, Pieter, 2012. "Incumbent performance in the face of a radical innovation: Towards a framework for incumbent challenger dynamics," Research Policy, Elsevier, vol. 41(8), pages 1357-1374.
    13. Haim Mendelson, 2000. "Organizational Architecture and Success in the Information Technology Industry," Management Science, INFORMS, vol. 46(4), pages 513-529, April.
    14. Yongwook Paik & Feng Zhu, 2016. "The Impact of Patent Wars on Firm Strategy: Evidence from the Global Smartphone Industry," Organization Science, INFORMS, vol. 27(6), pages 1397-1416, December.
    15. Haim Mendelson & Ravindran R. Pillai, 1999. "Industry Clockspeed: Measurement and Operational Implications," Manufacturing & Service Operations Management, INFORMS, vol. 1(1), pages 1-20.
    16. Li, Daitian & Capone, Gianluca & Malerba, Franco, 2019. "The long march to catch-up: A history-friendly model of China’s mobile communications industry," Research Policy, Elsevier, vol. 48(3), pages 649-664.
    17. Giachetti, Claudio & Marchi, Gianluca, 2017. "Successive changes in leadership in the worldwide mobile phone industry: The role of windows of opportunity and firms’ competitive action," Research Policy, Elsevier, vol. 46(2), pages 352-364.
    18. Lee,Keun, 2013. "Schumpeterian Analysis of Economic Catch-up," Cambridge Books, Cambridge University Press, number 9781107042681.
    19. Robert Jacobson, 1990. "Unobservable Effects and Business Performance," Marketing Science, INFORMS, vol. 9(1), pages 74-85.
    20. Hun Lee & Ken G. Smith & Curtis M. Grimm & August Schomburg, 2000. "Timing, order and durability of new product advantages with imitation," Strategic Management Journal, Wiley Blackwell, vol. 21(1), pages 23-30, January.
    21. Gonçalo Pacheco-de-Almeida & Ashton Hawk & Bernard Yeung, 2015. "The right speed and its value," Strategic Management Journal, Wiley Blackwell, vol. 36(2), pages 159-176, February.
    22. Ming‐Jer Chen & Danny Miller, 1994. "Competitive attack, retaliation and performance: An expectancy‐valence framework," Strategic Management Journal, Wiley Blackwell, vol. 15(2), pages 85-102, February.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Yexin Liu & Weiwei Wu & Yanggi Kim, 2023. "How do latecomer firms achieve catch-up through technology management: a comparative analysis," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-12, December.
    2. Giachetti, Claudio & Mensah, Deborah Tiniwah, 2023. "Catching-up during technological windows of opportunity: An industry product categories perspective," Research Policy, Elsevier, vol. 52(2).
    3. Vendrell-Herrero, Ferran & Bustinza, Oscar F. & Opazo-Basaez, Marco & Gomes, Emanuel, 2023. "Treble innovation firms: Antecedents, outcomes, and enhancing factors," International Journal of Production Economics, Elsevier, vol. 255(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Giachetti, Claudio & Mensah, Deborah Tiniwah, 2023. "Catching-up during technological windows of opportunity: An industry product categories perspective," Research Policy, Elsevier, vol. 52(2).
    2. Elisabet Garrido & Claudio Giachetti & Juan P. Maicas, 2023. "Navigating windows of opportunity: The role of international experience," Strategic Management Journal, Wiley Blackwell, vol. 44(8), pages 1911-1938, August.
    3. Yuzhe Miao & Jaeyong Song & Keun Lee & Chuyue Jin, 2018. "Technological catch-up by east Asian firms: Trends, issues, and future research agenda," Asia Pacific Journal of Management, Springer, vol. 35(3), pages 639-669, September.
    4. Lu Xu & Jie Xiong & Jie Yan & Richard Soparnot & Zhe Yuan, 2023. "Technological Uncertainty and Catch-Up Patterns: Insights of Four Chinese Manufacturing Sectors," Post-Print hal-04011634, HAL.
    5. Jaime Gómez & Raquel Orcos & Henk W. Volberda, 2021. "How imitation of multiple reference groups drives the evolution of firm strategy," Review of Managerial Science, Springer, vol. 15(8), pages 2319-2350, November.
    6. Souzanchi Kashani, Ebrahim & Roshani, Saeed, 2019. "Evolution of innovation system literature: Intellectual bases and emerging trends," Technological Forecasting and Social Change, Elsevier, vol. 146(C), pages 68-80.
    7. Zhe OuYang & Peng Cheng & Yang Liu, 2020. "The role of product line breadth, product pre-entry experience, and market uncertainty in explaining followers’ speed of feature entry," Review of Managerial Science, Springer, vol. 14(6), pages 1221-1249, December.
    8. Show-Ling Jang & Shihmin Lo & Wen Hao Chang, 2009. "How do latecomers catch up with forerunners? Analysis of patents and patent citations in the field of flat panel display technologies," Scientometrics, Springer;Akadémiai Kiadó, vol. 79(3), pages 563-591, June.
    9. Sungho Rho & Keun Lee & Seong Hee Kim, 2015. "Limited Catch-up in China’s Semiconductor Industry: A Sectoral Innovation System Perspective," Millennial Asia, , vol. 6(2), pages 147-175, October.
    10. Giorgio Prodi & Francesco Nicolli & Federico Frattini, 2020. "Embeddedness and local patterns of innovation: evidence from Chinese prefectural cities," Economic Complexity and Evolution, in: Andreas Pyka & Keun Lee (ed.), Innovation, Catch-up and Sustainable Development, pages 283-307, Springer.
    11. Petralia, Sergio & Balland, Pierre-Alexandre & Morrison, Andrea, 2017. "Climbing the ladder of technological development," Research Policy, Elsevier, vol. 46(5), pages 956-969.
    12. Kwak, Kiho & Kim, Namil, 2022. "Industrial Leadership Changes without Technological Discontinuity: Modularization, Institution-Led Market Discontinuity, and Market Development Strategy," Technological Forecasting and Social Change, Elsevier, vol. 180(C).
    13. Rikap, Cecilia, 2022. "Becoming an intellectual monopoly by relying on the national innovation system: the State Grid Corporation of China's experience," Research Policy, Elsevier, vol. 51(4).
    14. Keun Lee and John Mathews, 2013. "Science, technology and innovation for sustainable development," CDP Background Papers 016, United Nations, Department of Economics and Social Affairs.
    15. Prud’homme, Dan, 2016. "Dynamics of China’s provincial-level specialization in strategic emerging industries," Research Policy, Elsevier, vol. 45(8), pages 1586-1603.
    16. Joo, SH & Oh, C & Lee, Keun, 2016. "Catch-up Strategy of an Emerging Firm in an Emerging Country: Analyzing the Case of Huawei vs. Ericsson with Patent Data," MPRA Paper 109958, University Library of Munich, Germany.
    17. Peili Yu & Junguo Shi & Bert M. Sadowski & Önder Nomaler, 2020. "Catching Up in the Face of Technological Discontinuity: Exploring the Role of Demand Structure and Technological Regimes in the Transition from 2G to 3G in China," Journal of Evolutionary Economics, Springer, vol. 30(3), pages 815-841, July.
    18. Minaee, Mohammadreza & Elahi, Shaban & Majidpour, Mehdi & Manteghi, Manoochehr, 2021. "Lessons learned from an unsuccessful “catching-up” in the automobile industry of Iran," Technology in Society, Elsevier, vol. 66(C).
    19. Cristiano Antonelli & Christophe Feder, 2020. "Total factor productivity, catch-up and technological congruence in Italy, 1861–2010," Journal of Evolutionary Economics, Springer, vol. 30(4), pages 1171-1194, September.
    20. Rosiello, Alessandro & Maleki, Ali, 2021. "A dynamic multi-sector analysis of technological catch-up: The impact of technology cycle times, knowledge base complexity and variety," Research Policy, Elsevier, vol. 50(3).

    More about this item

    Keywords

    Speed of imitation; Competitive dynamics; Windows of opportunity; Catching up; Clockspeed; Mobile phone;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L63 - Industrial Organization - - Industry Studies: Manufacturing - - - Microelectronics; Computers; Communications Equipment
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

    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:eee:respol:v:51:y:2022:i:5:s0048733322000336. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/respol .

    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.