Building effective imitation strategies for competitive advantage

Abstract

Innovation has always been given great importance by companies and successful firms which try to do continuous innovation in its products are well respected in the society whereas imitation has always been considered as a stigma and an inferior act which is more often associated with embarrassment. But the truth lies in the fact that innovation is not the only way to enter the market and imitation has been always remained an important part of the corporate world and has often been more abundant than innovation in many sectors. Although companies which imitate others’ products deny copying the product for the fear of losing face in the market and try to hide it under a blanket of innovation, there is enough anecdotal evidence in the favor of imitation being prevalent in the market. Lesser publicity given to imitation skills does not necessarily mean that it is ineffective and infrequent. In reality, it is quite common and also earns sufficient rewards if done wisely by applying the right strategy. In today’s world of cut throat competition for market share, the mindset against imitation is changing and it has been observed that more and more businesses are on the lookout for great ideas in and even outside their industry and are using well-orchestrated imitation as a means of competitive advantage. Quite a few high performer firms are actively using the mechanism to deliberately lag behind, sharpen skills, accumulate resources, imitate and improve the innovation to pull ahead at the opportune moment. Although the rewards for being the first mover in the industry are often substantial, the innovator runs a huge risk by putting in a lot of investment in the product. The imitator, on the other hand, gets the advantage of a free rider as the uncertainty surrounding the product gets reduced and a clearer picture of the market is available. In some products, imitation is the more preferable strategy compared to innovation and many industry leaders have been reached that place by applying imitation skills.