The Moderating Role of Submarket Dynamics on the Product Customization-Firm Survival Relationship

• 成果类型: Article
• 署名作者: Bhaskarabhatla, Ajay
• 署名单位: Erasmus University Rotterdam; Erasmus University Rotterdam - Excl Erasmus MC
• 刊物名称: ORGANIZATION SCIENCE
• ISSN/ISSBN: 1047-7039
• DOI: 10.1287/orsc.2016.1074
• 发表日期: 2016
• 页码: 1049-1064
• 关键词: competitive strategy; strategy and policy; longitudinal research design; Industrial Organization; evolutionary approaches; product design; technology and innovation management

摘要

In this paper, we examine how the provision of product customization services affects firm survival. Integrating literatures on industry evolution, product-related adapting services, and entry deterrence, we hypothesize that the relationship between product customization-the costly modification of a product to cater to customer needs-and firm survival differs across industries, based on the extent of submarkets. We argue that in industries that feature submarkets more prominently, the positive association between product customization and firm survival is stronger for two conceptually distinct and empirically distinguishable mechanisms: customizing firms enter new submarkets and also deter potential entry. We conclude that offering product customization services has strategic benefits that sometimes outweigh the cost of coordinating with customers.