The performance effects of creative imitation on original products: Evidence from lab and field experiments

Abstract

Research Summary A market entrant often challenges the incumbent using creative imitation: The entrant creatively combines imitated aspects of the original with its own innovative characteristics to create a distinct offering. Using lab and field experiments to examine creative imitation in China, we find the effects of creative imitations on the originals depend on the creative imitation's quality. We explore the underlying mechanisms, and show that including a low‐quality creative imitation in the retail choice set increases satisfaction with and choice of the original, while a moderate‐quality creative imitation does the opposite. Moreover, creative imitation affects consumers' satisfaction with the original by influencing whether their experience with the original verifies their expectations. Our paper reveals creative imitation effects to help incumbent firms effectively address them. Managerial Summary When the incumbent is challenged by an entrant using creative imitation, consumers may react differently to the incumbent, and understanding consumers' reactions allows the incumbent to make better strategic decisions about how to address the challenge. Using lab and field experiments, we investigate creative imitations with two quality levels common in our empirical context, low quality and moderate quality, and examine how and why they differentially affect the originals. We find the presence of a low‐quality creative imitation actually increased choice of the original by enhancing consumers' satisfaction with it, while a moderate‐quality creative imitation reduced choice of the original by undermining satisfaction with it. Our research suggests the incumbent should address moderate‐quality creative imitations' challenges to customer satisfaction, while temporarily tolerating low‐quality creative imitations.

Performance implications of combining creative and imitative innovation strategies

“…Thus, the results from our overall sample provide support for the viability of those three innovation strategies. The findings are consistent with studies that extol the benefits of creative innovation (Bach et al, 2019;Damanpour and Evan, 1984;Damanpour et al, 2009), imitative innovation (Wang et al, 2019), and the synergistic (Lee et al, 2019) or combinative effects of different types of innovation (Arranz et al, 2019;Ballot et al, 2015;Doran, 2012;Tavassoli and Karlsson, 2016).…”

“…Building on the pioneering work of Levitt (1966) and its subsequent studies, researchers have identified two different types of innovation strategies: creative innovation and imitative innovation strategies (Garcia and Calatone, 2002;Huang et al, 2010;Sadowski and Sadowski-Rasters, 2006;Wang et al, 2019). Creative innovation strategy is defined as engaging in a pioneering activity to develop and introduce a new product or service first in the market (Kim and Nelson, 2000).…”

“…Creative innovation, also referred to as original, real or true innovation (Brouwer and Kleinknecht, 1999;Garcia and Calatone, 2002;Sadowski and Sadowski-Rasters, 2006), represents the launching of a new product, service or process to the market by a firm before its competitors. On the other hand, imitative innovation, which is also referred to as creative or innovative imitation (Kale and Little, 2007;Kim and Nelson, 2000;Levitt, 1966;Wang et al, 2019), connotes innovation that is only new to the firm introducing the new product, service or process though it is already available from its competitors in the market (Huang et al, 2010;Wang et al, 2019). Therefore, imitative innovation indicates the application of an innovation that has already been created in another organization.…”

“…While creative innovation has made more contributions to sustaining competitive advantage than imitative innovation, researchers have stressed that most firms engage in innovations which are imitative in nature, and the contributions of imitative innovation should not be underrated (Garcia and Calantone, 2002;Huang et al, 2010;Levitt, 1966). Recent research has begun to provide empirical evidence about the important role imitative innovation plays in a firm's competitiveness and performance (Wang et al, 2019). Imitative innovators, who are usually considered second movers or fast followers, seek to gain a competitive advantage and improve performance by reducing or avoiding substantial development and testing costs (Lieberman and Montgomery, 1988).…”

Leave or stay? The role of self‐construal on luxury brand attitudes and purchase intentions in response to brand rejection

“…Yet little is known about how culture, and consumers' views of themselves as independent or interdependent (i.e., their self‐construal), affect consumers' responses to brand rejection. Luxury brands are a category in which sales differ significantly by culture (Demangeot et al, 2015), and Asian countries, in particular, continue to be lucrative markets for luxury products (Shukla, Singh, & Banerjee, 2015; Wang, Wu, Pechmann, & Wang, 2019). A large body of literature indicates that western consumers place more emphasis on hedonic experiences, personal tastes, and private meanings of luxury possessions.…”