An Examination of New Product Innovativeness and Performance: The Moderating role of Commercial Environment

Abstract

The paper explores the link between new product innovativeness and performance, as well as its moderation by commercial environment in retail. It analyzes the linkage and context built on marketplace, company’s characteristics and retail category management decisions as an integral commercial environment. The research employs a unique data set - new product introductions with their actual sales results as a performance indicator. The research concludes that the innovativeness – performance link cannot be evaluated unilaterally, confirming the role of the commercial environment as a moderator of the link. The commercial environment is associated with a favorable and non-favorable economic climate that leads to performance-related opportunities or barriers in the marketplace for product innovations. Findings add value to the theoretical development of innovativeness-performance linkage studies, and also are valid pratically. It provides practical guidance to the integral understanding of commercial environment to which companies might be able to adapt during the new product launch.