Pioneer advantage: marketing logic or marketing legend? Flashcards
What is “Golder, P. N., & Tellis, G. J. (1993). Pioneer Advantage: Marketing Logic or Marketing Legend?” about?
The article evaluates the concept of pioneer advantage—the idea that firms entering markets first (pioneers) gain long-term market share and leadership benefits. It challenges prior research that may have overestimated these advantages due to: 1) survivor bias, 2) data collection issues, and 3) broad definitions
What is “survivor bias”?
the exclusion of failed pioneers in earlier studies
What are the managerial implications of “Golder, P. N., & Tellis, G. J. (1993). Pioneer Advantage: Marketing Logic or Marketing Legend?”?
1) firms should carefully weigh the risks of pioneering vs entering later, as early leaders (early leaders often see success by learning from pioneers’ mistakes & committing significant resources to R&D)
2) continuous innovation - pioneers must adapt and innovate to maintain leadership
3) realistic expectations for pioneers - being first doesn’t guarantee success; firms must assess if potential short-term monopoly profits justify the risks
What theories support the pioneer advantage?
1) Consumer-Based Advantages theory - early entrants influence consumer preferences & standards; customers stick to pioneers due to perceived reliability & switching costs
2) Producer-Based Advantages theory - pioneers preempt scarce resources; learning curves and economies favor early entrants
What theories challenge the pioneer effect?
1) free-rider effect (later entrants replicate or improve on pioneer’s tech at lower costs)
2) shifts in market dynamics - chancing customer preferences & tech advances often benefits later entrants
3) incumbent inertia - pioneers may resist adapting to market shifts due to established processes
What are the key findings from “Golder, P. N., & Tellis, G. J. (1993). Pioneer Advantage: Marketing Logic or Marketing Legend?”
- 47% of pioneers fail
- failure rates for durable goods were higher than non-durable due to rapid tech changes in durable goods
- mean market share for pioneers was lower than prev. reported
- leadership duration averaged 5y for most pioneers, w/ few achieving dominance
- early leaders, entering about 13y later, were more successful than pioneers
What is the conclusion from “Golder, P. N., & Tellis, G. J. (1993). Pioneer Advantage: Marketing Logic or Marketing Legend?”
The study undermines the traditional narrative of pioneer advantage, showing that pioneers face high risks and often fail to achieve long-term success. Early leaders, who enter later but commit significant resources, are more likely to dominate markets. This challenges firms to rethink the value of being first and focus instead on strategies for achieving sustainable market leadership.
