New Model Introductions, Cannibalization and Market Stealing: Evidence from Shopbot Data

24 Pages Posted: 4 Jun 2014

See all articles by Michelle Haynes

Michelle Haynes

University of Nottingham

Steve R. Thompson

University of Nottingham

Peter W. Wright

University of Sheffield - Faculty of Social Sciences

Date Written: July 2014

Abstract

Incremental innovation plays an important role in competitive conduct in high‐tech industries. This paper explores the impact of new model introduction by employing a nested logit specification to investigate the determination of market shares across and within submarkets for a panel of 336 digital cameras. Our results confirm the existence of pronounced life cycle effects and the existence of statistically significant market stealing and cannibalization effects, particularly associated with the introduction of a technologically superior entrant into the model's market segment. The paper reveals significant differences in market outcomes, in both elasticity and response to entry, across submarkets.

Suggested Citation

Haynes, Michelle and Thompson, Steve R. and Wright, Peter W., New Model Introductions, Cannibalization and Market Stealing: Evidence from Shopbot Data (July 2014). The Manchester School, Vol. 82, Issue 4, pp. 385-408, 2014, Available at SSRN: https://ssrn.com/abstract=2445735 or http://dx.doi.org/10.1111/manc.12024

Michelle Haynes (Contact Author)

University of Nottingham ( email )

University Park
Nottingham, NG8 1BB
United Kingdom

Steve R. Thompson

University of Nottingham ( email )

University Park
Nottingham, NG8 1BB
United Kingdom

Peter W. Wright

University of Sheffield - Faculty of Social Sciences ( email )

United Kingdom

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