Strategic introduction of a new product under uncertainty: A duopoly case

Terrazas-Santamaría, Diana

doi:10.1002/mde.3273

Cited by 4 publications

(3 citation statements)

References 35 publications

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“…We echo the dispute that new product advantage does not equal market success (Kim et al, 2016), and we further explore the underlying mechanism. In contrast to previous studies that mainly discuss manufacturers' launch strategies or capabilities per se (Racela and Thoumrungroje, 2020;Terrazas-Santamaria, 2021), we emphasise the important role of co-launch retailers and formal channel governance. Specifically, launches of new products with high levels of market advantage are best governed through contract explicitness and a moderate level of retailers' TSIs, whereas launches of new products with high levels of tech advantage are best governed by retailers' TSIs.…”

Section: Theoretical Implicationsmentioning

confidence: 92%

“…Thus, to successfully translate new product advantage into market performance, manufacturers need to suitably align the activities of retailers when launching products (Dean et al, 2016). However, previous studies focus on the strategic orientation of manufacturers for product launch (Terrazas-Santamaria, 2021) or their launch strategies and capabilities for targeting customers (Parker et al, 2017;Racela and Thoumrungroje, 2020); few studies analyse the governance of new product launches through retailers. This omission is surprising, as researchers frequently emphasise the importance of proactively involving and governing channel partners in the early stages of R&D (Thi Mai Anh et al, 2019).…”

Section: Introductionmentioning

confidence: 99%

“…, 2016). However, previous studies focus on the strategic orientation of manufacturers for product launch (Terrazas-Santamaria, 2021) or their launch strategies and capabilities for targeting customers (Parker et al. , 2017; Racela and Thoumrungroje, 2020); few studies analyse the governance of new product launches through retailers.…”

Section: Introductionmentioning

confidence: 99%

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Attributes of product advantage and choices for manufacturer–retailer formal governance: the case of new product launch

Zheng¹,

Qian²,

Yang³

2021

APJML

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PurposeThis study examined how the technological (tech) advantage and market advantage of new products influence the level of formal channel governance and, in turn, affect the success of new products in the presence of relational governance.Design/methodology/approachThe hypotheses are tested using the partial least squares approach to analyse survey data collected from 392 retailers of customer goods in China.FindingsThe results indicate that tech advantage and market advantage lead to an increase in retailers' transaction-specific investments (TSIs) and contract explicitness, respectively; the positive effect of market advantage on a retailer's TSIs will gradually decrease and will even become negative beyond a certain point. The relational governance mechanism can substitute for the effects of contract explicitness on improving new product success.Originality/valueThis research provides a new perspective for understanding new product advantage and exerts an initial effort to empirically distinguish between tech advantage and market advantage. It enriches the innovation literature by examining the governance of new product launches through retailers and explores the effects of formal and informal governance on channel cooperation performance in the new product launch stage.

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Section: Theoretical Implicationsmentioning

confidence: 92%

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

Attributes of product advantage and choices for manufacturer–retailer formal governance: the case of new product launch

Zheng¹,

Qian²,

Yang³

2021

APJML

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Beyond profit: Exploring CEO tenure, social value risk‐taking, and competitive dynamics in savings banks

Lee

2024

Corp Soc Responsibility Env

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Existing research overlooks the possibility that firms may engage in risk‐taking for social value beyond profit. Drawing on the community embeddedness literature, we propose that firms engage in risk‐taking for social value to enhance their local standing and acceptance. We examine the microfinance lending activities of 79 South Korean savings banks from 2013 to 2022 to test our hypotheses. Contrary to previous findings that longer CEO tenure decreases corporate risk‐taking, our results show that longer CEO tenure is associated with increased corporate risk‐taking for social value, suggesting that the impact of CEO tenure on risk‐taking depends on the firm's goals. Additionally, our results indicate that when neighboring firms in the same community engage in legitimacy‐enhancing behaviors, this triggers a corresponding increase in the focal firm's efforts to enhance local legitimacy. This implies a competitive “race for legitimacy” among firms within the community. We discuss these findings' implications and explore future research directions.

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Game‐theoretic approaches to product introduction strategies for durable products

Pirayesh Neghab,

Restrepo Diaz,

Cevik

et al. 2024

Manage Decis Econ

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New product demand continuously fluctuates throughout the life of the product. As a result, markets typically experience high volatility. Most companies operate in highly competitive industries where the product volume supplied by the competitors significantly affects production plans. These conditions necessitate companies to be flexible and rapidly adapt to such volatility. In this study, we investigate the product introduction strategies under two microeconomic theories: real‐option valuation and game theory. Specifically, we develop a real‐option valuation framework with a flexible capacity based on two game‐theoretic models, namely, Stackelberg and Cournot, in a duopoly market where competitors have either perfect or imperfect information. Furthermore, we construct a lattice to discretize the demand evolution and adopt a regime‐switching approach to characterize the stochastic product lifetime. We conduct an extensive numerical study and compare net present values (NPVs) and optimal capacities obtained from the game‐theoretic models. Our results show that under perfect information, the Stackelberg competition generates more supply with lower prices and less total than the Cournot competition. Moreover, we find that, compared to the fixed‐capacity system, the flexible capacity system increases the in the Stackelberg game (by 5.5%) more than in the Cournot game (by 3.3%). We provide further results on the performance of the companies based on detailed sensitivity analysis for various model parameters. In particular, we observe that fixed and variable production and installation costs majorly impact capacity allocation decisions and profits.

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Strategic introduction of a new product under uncertainty: A duopoly case

Cited by 4 publications

References 35 publications

Attributes of product advantage and choices for manufacturer–retailer formal governance: the case of new product launch

Attributes of product advantage and choices for manufacturer–retailer formal governance: the case of new product launch

Beyond profit: Exploring CEO tenure, social value risk‐taking, and competitive dynamics in savings banks

Game‐theoretic approaches to product introduction strategies for durable products

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