New Product Entry Timing Strategy And Performance Assessment

Within the context of the business environment characterized by dynamic changing and increasingly complexity, the multiple emerging new markets equipped with uncertainty may result in both chances and challenges for the survival and development of the enterprises. Market entry turns to be a strategic choice that the firms have to involve. Entry timing decisions are properly significant to managers of both the incumbent firms and the potentially start-up ones as timing choices contribute to building the competitive advantages. In the prior strategic management research, entry research mainly focuses on single entry event, aiming to explore the mechanism that how the multiple entry models lead to the performance differences of different types of market entrants while examining from the resource-based view. Recently, scholars have recognized market entry timing as a process rather than an event, emphasizing the fact that market development makes even the prime entrants urgent to address a post entry or repeat entry plan. On the other hand, based on the presumption of first mover advantages approach, many scholars ascertain the advantages of being a pioneer or early entrant as opposed to a follower or late entrant. Hence, most of the literature measure entry timing as a one-dimensional construct, commonly estimated by calculating the time elapsed from first entry or the time elapsed between entry and market or industry formation. However, as timing is proved to be more endogenous,entry timing turns to be the viewed as the reflection of strategic intents rather than the merely consequences of industry context. Only a few studies examine the internal entry timing strategies that focusing on the timing among multiple products within the same organization. Against this background, our research, on one hand, aims to shed light on exploring how a set of new product entry actions undertaken by a firm in a given time can contribute to achieving superior performance while regarding the entry as a process.On the other hand, focuses on the classification of entry timing and examines the determinants and the consequences of two- dimensional entry timing. The main works are as follows:Firstly, we analyze the relationship between new product entry actions and firm performance from the firm-based view. Based on the panel data of auto firms in Chinese auto market from 2007-2012, we aim to explore how a set of entry actions undertaken by a firm in a given time can contribute to achieving superior performance. Drawing on action repertoire theory originated from the competitive dynamics theory, we examine the impacts of entry action repertoire, what is termed volume, complexity and heterogeneity, on firm performance. Meanwhile, we also assume that firm performance can be shaped by its entry actions and the context of firm reputation jointly with the adopting of signal theory.Secondly, from the perspective of product, we explore the antecedents of the followers' entry timing. We insist on the classification of the timing process itself, in contrast to concentrating on the timing measurement merely involving the external"players" (e.g., incumbents, rivals, first-movers, imitators) .To do this, we assume that entry timing can be further divided into two categories according to the objective that the entry time lag compared with, namely, internal and external. Internal entry timing is designed to reflect the distinguishing entry strategies of various products within one certain firm while external entry timing tries to capture the impacts of rivals or other incumbents in the market on the timing decisions. Our analysis adopts empirical data from 565 new product entry events in the China auto industry from 2011-2013 to explore the determinants of followers internal and external post-entry timing decisions, what is termed firm flexibility, product pre-entry experience. We also extend our research setting to consider how market-specific uncertainty moderates the effects of flexibility and pre-entry experience. We conclude that both firm flexibility and product pre-entry experience can accelerate the speed of the followers' internal entry while only firm flexibility deters the followers' external entry. Additionally,market-specific uncertainty moderates the relationship between flexibility, experience and entry timing decisions. Greater uncertainty tends to boost the internal and external entry of the followers than that of lower uncertainty.Lastly, we advance the understanding of the consequences of followers' post-entry timing strategies in terms of internal and external timing dimensions at the product level.In addressing this issue, we discover an opportunity to settle the empirical debate in the context of Chinese contemporary automotive market. We examine the impact of internal entry timing and external entry timing on product performance and the moderate effect of internal entry timing on external entry timing. Our results illustrate that both the value of internal and external entry timing lag can exert positive impacts on product performance, which means that later followers compared to the prior"brotherly" products or rivals' products are more likely to achieve higher performance.Otherwise, the value of internal entry timing negatively moderates the relationship between external entry timing and product performance. Intriguingly, the simultaneous examination of two dimensions of entry timing also enables us to shed light on the crowding out effect of intense post-entries in auto markets.Our study provides several meaningful results.Firstly, this study contributes to entry literature that focuses on assessing the effects of a set of entries in a given time rather than one single product entry event. Based on competitive theory, new product entry actions are viewed as competitive actions initiated by firms to enhance competitive performance. Considering three characteristics of competitive actions repertoire, our research presents a new antecedent of an empirical test of entry action volume, complexity, and heterogeneity. Otherwise,our research also studies the issue of how firm reputation context exerts an impact on signaling process and the capability of firms to enhance their performance via new product entry movements.Secondly, responding to the call for more research of entry timing as a multidimensional and multilevel concept and the possible interactions among the multiple contingencies, we identify a two-dimensional timing that captures the managers' strategic intent referring to the multiple product innovation process and their awareness of rivals' actions. Previous works on entry timing recognized market entry as a process rather than an event, emphasizing the fact that market development makes even the prime entrants urgent to address a post-entry or repeat entry plan. Our research extends these timing ideals further by focusing on internal and external dimension.Thirdly, this study advances empirically the multilevel research crossing products,firms and industries. Given the inherently nested nature of entry timing study, the ideal,theories and methods adopted to explain the antecedents and consequences of timing behaviors have to address hierarchical effects. Our study help address this gap by assessing the effects of firm flexibility, product pre-entry experience and market uncertainty on entry timing decisions.Fourthly, we contribute to the debate referring to the effect of entry timing by evidencing crowding out effect of its different dimensions on product performance. In doing so, this investigation thus sheds light on the disadvantages of earlier entry that there exists the crowding out effect of entrants by their new companies or competitors,which results in declining market shares or market exit. To the best of our knowledge,we are among the first to analyze the effects of two dimensions of entry timing with the finding of crowding out effect of entrants.