Nothing New under the Sun? How Firms Can Benefit from New Product Imitation

Legitimate or legal new product imitation is a widely used competitive strategy. A well known example is Apple’s creation of the iPad, which followed the development of tablet devices by competitors years prior. But how do firms go about doing new product imitation well and reap the rewards of this strategy? This research aims at answering this focal question by relying on a qualitative and quantitative methods as well as theories from management (awareness-motivation-capability framework) and linguistics (concept of contextualization and translation). In the first phase, twelve semi-structured depth interviews were conducted with new product development (NPD) and innovation professionals in the U.S. to guide the development and refinement of the research framework. The interviews were analyzed for themes, and largely supported the initial framework. In the second phase, an online survey was conducted of NPD- innovation professionals through LinkedIn groups to test the framework. The analysis of 329 valid responses via structural equation modeling and hierarchical linear regressions provided some support for the research hypotheses. New product imitation (NPI) was found to be a two-stage process of contextualization and recontextualization of the competitor’s product to be imitated. The imitator’s reverse engineering capabilities and distribution capabilities are relatively more important contributors to NPI, contingent on the imitator’s awareness and motivation to engage in NPI. NPI is a determinant of innovative imitativeness in terms of product similarity, which positively affects new product performance, whereas marketing imitativeness is a negatively influence. This research makes several contributions to research and practice. Chief among the research contributions is that NPI is conceptualized and empiricized as a formal construct for the first time. Additionally, its antecedents, consequences, and contingencies are determined, including that legitimate imitation does pay off, as long believed. In terms of practice, managers are provided through the tested and supported model a roadmap to do NPI well. By being one of the first studies to examine legitimate NPI -- and finding it be a potent avenue of innovation -- this investigation helps to address the innovation bias in the literature, and validate and illuminate imitation as a viable new product strategy.