Market pioneering-where a firm is first to offer a distinctively new product to the market-is a commonly recognized form of corporate entrepreneurship. As with other forms of corporate entrepreneurship the linkage between market pioneering and firm performance has received limited empirical attention, much of which has yielded inconsistent results. Nonetheless, two conclusions regarding when and how pioneering relates to firm performance are revealed in the literature. First theory and past research suggest that pioneering is an environment-specific phenomenon. That is, certain types of environments may be most likely to encourage or reward the actions of pioneers, while these same actions may meet with limited success in other environments. Second, theory and past research suggest that firm performance is affected by the fit between a firm's pioneer/follower status and ifs competitive tactics. In other words, market entry order moderates the effectiveness of a firm's competitive tactics such that certain tactics will be most effective when employed by market pioneers, while other tactics will be most effective when employed by market followers. Considered jointly, the preceding observations suggest that insights might be gained regarding the effective management of market pioneering and market following by seeking to understand (a) how these phenomena are manifested in different industry environments and (b) what pioneers and followers do differently in these environments to promote their performance. The research described in this paper addresses these issues. In particular, this paper develops theory that describes how particular competitive tactics are thought to relate to firm sales growth rate among market pioneers and market followers in two distinct environmental settings. Hypotheses are developed based on the following research propositions: PI: In hostile environments, pioneers and followers will differentially benefit in achieving high sales growth rates from their reliance on relatively high prices, relatively broad product lines, relatively broad served (geographical) markets, relatively advanced process technologies, and relatively advantageous purchasing arrangements. P2: In benign environments, pioneers and followers will differentially benefit in achieving high sales growth rates from their reliance on relatively high quality products, relatively strong product warranties, relatively high advertising and promotion expenditures, relatively strong control over distribution channels employed, and relatively large numbers of distribution channels employed. To test the hypothesized relationships, data were collected from the senior managers of 103 independent, nondiversified manufacturing firms operating in 75 industries Cluster analysis, ANOVA, and correlational analysis were employed as the principal analytical techniques. The results suggest that market pioneers grow neither more nor less rapidly than market followers. However, in hostile environments, pioneering may enable firms to break our of the dominant price-based mode of competition and grow in spire of charging high prices. This ability of pioneers to excel in hostile environments seems to be further facilitated by limiting product line breath to a small number of product offerings that provide a "tight fit" with market needs. Pioneers in hostile environments also appear to be relatively better served than followers from gaining a wide geographical distribution for their products. Followers in hostile environments, an the other hand, should seek to reduce their cost structures in order to effectively sustain low price strategies. The employment of advanced process technologies and the pursuit of "purchasing advantages" were actions which proved to be more advantageous for followers than for pioneers in hostile environments. The managerial implications of this research applicable to benign environment firms are quite different. Other things being equal relatively high prices may not be as detrimental to growth among followers in benign environments as they are among followers in more hostile environments. Benign environment followers may, in fact, be better off when they charge relatively high prices and compete on non-price bares. The results also suggest that, in benign environments, offering products,with warranties superior to those of competitors may have a significantly more positive effect on sales growth among pioneers than followers. Moreover, employing a large number of distribution channels appears to benefit pioneers more than followers. However among the sampled firms, benign environment pioneers that realized the greatest growth did not have extensive control over distribution channel members. Therefore, benign environment pioneers may grow more quickly if they target their distribution-related resources toward expanding their channels rather than toward controlling some smaller number these channels. This study contributes to the pioneering literature by having corroborated several findings of the PIMS-based studies regarding tactical differences between pioneers and followers, and by having further documented the relevance of market entry order (or pioneer/follower status) as a moderator of the performance associated with particular competitive tactics. Moreover, by having examined the tactics-performance relationships of pioneers and followers in two distinct environmental settings, this study adds specificity and empirical support to the emerging theoretical paradigm that depicts pioneering as an environment-specific phenomenon. Finally, this study contributes to the literature on coping with hostility by having theorized about and empirically identified common and effective bases for competition under varying levels of environmental hostility. (C) 1999 Elsevier Science Inc.
