The effect of introducing important incremental innovations on market share and business survival

Article Abstract:

The impact of implementation of significant incremental product innovations on the market share and business survival of an industry incumbent are investigated. For the study, archival sources are used to assess incremental innovations in the implantable cardiac pacemaker industry after 1963. Results support the view that effective incremental product development and fast production introduction are critical factors in improving business performance. Introduction of incremental product innovations while it is the industry incumbent is an important factor in ensuring the attainment of an attractive market share for the business and its survival in an established industry. Greater long-term market share can be achieved if the product line of a firm when it first entered the industry is sophisticated enough. Firms that were the first to adopt innovations introduced by their competitors were able to increase their market share although not as great as the market share of the firm that introduced the innovation.

Electromedical and Electrotherapeutic Apparatus Manufacturing, Electromedical equipment, Pacemakers, Research, Business, Innovations, Product development, Medical equipment and supplies industry, Medical equipment industry

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Commentary on 'Entry into new market segments in mature industries: endogenous and exogenous segmentation in the U.S. brewing industry' by A. Swaminathan

Article Abstract:

The two processes of niche formation and resource partitioning offer two different views on the entry of new firms into new market segments in mature industries. While the niche formation model focuses on environmental factors as the driving forces behind market entry, the resource partitioning argument states that structural changes within an industry lead to the formation of subgroups composed of generalist and specialist firms. A modeling of the effects of niche formation and resource partitioning on the founding of firms in the US brewing industry reveals that new niches evolve out of exogenous factors, such as lifestyle changes of consumers and the ensuing modifications in their preferences. Results thus provide stronger support for the niche formation theory as a better explanation for the founding of firms in the microbrewery and brewpub segments.

Beer & Other Malt Beverages, Breweries, Malt beverages, Brewing industry, Market segmentation, New business enterprises, Startups, Industrial concentration

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Dual clocks: entry order influences on incumbent and newcomer market share and survival when specialized assets retain their value

Article Abstract:

The advantages and disadvantages of early entry into new technical areas by manufacturing firms was investigated to test whether the performance of newcomers into a field will be affected by their time of entry due to the superior assets of industry incumbents. It is hypothesized that early entrants will outperform late entrants. The research sample covered 314 manufacturing firms in the diagnostic imaging industry. Research results supported the hypothesis. Incumbents and newcomers are subject to entry order effects. Incumbents are affected by other incumbents, while newcomers are affected by the entry order of all other newcomers.

Management, Management research, Diagnostic imaging

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