Academic journal article Journal of Economics & Management

Does Coopetition Strategy Improve Market Performance? an Empirical Study in Mobile Phone Industry

Academic journal article Journal of Economics & Management

Does Coopetition Strategy Improve Market Performance? an Empirical Study in Mobile Phone Industry

Article excerpt

(ProQuest: ... denotes formulae omitted.)

Introduction

Since the seminal book of Brandenburger and Nalebuff (1996), coopetition has been the subject of an increasing amount of research in the field of strategic management. Researches on coopetition have been developed in many directions, to the point that today it is difficult to make a complete synthesis (Yami et al., 2010; Bengtsson and Kock, 2014; Czakon et al., 2014). An essential question asked about coopetition is that of its impact on performance. From the beginning, coopetition theory has been resolutely normative. For Brandenburger and Nalebuff (1996), coopetition is a strategy that will lead to better performance. This normative point of view has not been questioned and is always considered as relevant in coopetition theory (Bengtsson and Kock, 2014; Czakon et al., 2014).

Some past researches are dedicated to establish empirically a relationship between coopetition strategies and performance. In this way, some first studies highlight the impact of alliance between competitors on economic and financial performance (Luo et al., 2007; Ritala et al., 2008; Oum et al., 2004; Kim and Parkhe, 2009). Other studies attempt to show the impact of cooperation among competitors on innovation (Belderbos et al., 2004, Neyens et al., 2010; Nieto and Santamaria, 2007; Peng et al., 2011). Latest studies directly use the concept of coopetition to attempt to establish its impact on economic performance (Marques et al., 2009; Morris et al., 2007), on innovation (Quintana-Carcias and BenaviedsVelasco, 2004; Le Roy et al., forthcoming) or on market performance (Ritala, 2012).

Researches which study the link between coopetition strategy and performances are however far from exhausting the subject. They do not identify the impact of coopetition strategies on performance compared with the impact of other strategies. The supposed superiority of coopetition strategies over other strategies, like aggressive strategy or cooperative strategy, has therefore never been tested empirically. It is also noteworthy, except Ritala (2012), that none of this research addresses the impact of coopetition on market performance. In the original definition of Brandenburger and Nalebuff (1996), coopetition is supposed to allow rivals to increase the overall value they create for the customer, which should enable them to develop their sales. But just one empirical study is dedicated to this central point of coopetition theory (Ritala, 2012). The present research therefore aims to fill this double gap, by trying to establish empirically the impact of coopetition strategy on market performance, and by comparing it with the impact of cooperative and aggressive strategies.

To this end, this research analyzes the strategies implemented by firms in the sector of mobile telephony. The method used is structured content analysis. This method makes it possible to identify the strategic movements of mobile operators from different countries and geographic regions. The results show that mobile operators adopt different strategies in the same industry, deciding to follow an aggressive strategy, a cooperative strategy or a coopetitive strategy. There is also the possibility that firms might adopt a strategy that we describe as the coexistence strategy, where show neither a strong tendency to cooperate, nor a strong tendency to aggression. However, in our sample there appear to be no firms that adopt this strategy. The results also show that the market performance of a firm depends on the strategy it adopts toward its competitors. A coopetitive strategy appears to perform better than either an aggressive strategy or a cooperative strategy. An aggressive strategy appears to perform better than a cooperative strategy.

The results obtained in this research contribute significantly to the literature on coopetition. This is the first study comparing the relative impact of aggres- sive, cooperative and coopetitive strategies on market performance. …

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