Leveraging the first mover advantage: proprietary technologies versus cost leadership

R. Coeurderoy, R. DURAND

Journal of Business Research

June 2004, vol. 57, n°6, pp.583-591

Departments: Strategy & Business Policy, GREGHEC (CNRS)

Keywords: Early mover advantage, Proprietary technologies, Cost leadership, Market share

This research develops the relationships between the "early mover advantage" and a firm's market share. It tests hypotheses relating a firm's strategic choices and order of entry to market share on a cross-sectional data set of 1042 French manufacturing companies. The results support the persistence of an advantage for early movers. Furthermore, the development of proprietary technologies, considered as a capability to protect in-house knowledge from competition, has a leverage effect on the advantage of early moving. Finally, if cost leadership is a relevant strategy to gain market share, it is mostly beneficial for late entrants