Intra-industry Diversification Effects Under Firm-specific Contingencies on the Demand Side

Florian Smeritschnig; Jakob Muellner; Phillip C. Nell; Martin Weiss

doi:10.1016/j.lrp.2020.101992

Intra-industry Diversification Effects Under Firm-specific Contingencies on the Demand Side

Florian Smeritschnig, Jakob Muellner, Phillip C. Nell^*, Martin Weiss

^*Corresponding author for this work

Department of Strategy and Innovation

Research output: Contribution to journal › Journal article › Research › peer-review

Abstract

How do firm-specific, demand-related factors influence the relationship between intra-industry diversification (IID) and performance? Recent findings regarding the performance effects of IID depict a complex picture with curvilinear relationships and several contingencies. However, firm-specific contingencies on the demand side have remained unexplored. We analyze how IID relates to firm performance (market share) in the German automotive industry using panel data between 1999 and 2008. We specifically focus on a firm's high-quality brand image as a demand-side contingency. We find support for our hypotheses of complex curvilinear relationships as well as for moderating effects of brand quality. Our results have significant theoretical implications for the IID literature.

Original language	English
Article number	101992
Journal	Long Range Planning
Volume	54
Issue number	1
Number of pages	17
ISSN	0024-6301
DOIs	https://doi.org/10.1016/j.lrp.2020.101992
Publication status	Published - Feb 2021

Bibliographical note

Published online: 2 April 2020

Keywords

Across-segment product proliferation
Intra-industry diversification
Intra-industry diversification-performance relationship
Related diversification
Within-segment product proliferation

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Cite this

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title = "Intra-industry Diversification Effects Under Firm-specific Contingencies on the Demand Side",

abstract = "How do firm-specific, demand-related factors influence the relationship between intra-industry diversification (IID) and performance? Recent findings regarding the performance effects of IID depict a complex picture with curvilinear relationships and several contingencies. However, firm-specific contingencies on the demand side have remained unexplored. We analyze how IID relates to firm performance (market share) in the German automotive industry using panel data between 1999 and 2008. We specifically focus on a firm's high-quality brand image as a demand-side contingency. We find support for our hypotheses of complex curvilinear relationships as well as for moderating effects of brand quality. Our results have significant theoretical implications for the IID literature.",

keywords = "Across-segment product proliferation, Intra-industry diversification, Intra-industry diversification-performance relationship, Related diversification, Within-segment product proliferation, Related diversification, Intra-industry diversification, Intra-industry diversification-performance relationship, Across-segment product proliferation, Within-segment product proliferation",

author = "Florian Smeritschnig and Jakob Muellner and Nell, {Phillip C.} and Martin Weiss",

note = "Published online: 2 April 2020",

year = "2021",

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language = "English",

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AU - Smeritschnig, Florian

AU - Muellner, Jakob

AU - Nell, Phillip C.

AU - Weiss, Martin

N1 - Published online: 2 April 2020

PY - 2021/2

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N2 - How do firm-specific, demand-related factors influence the relationship between intra-industry diversification (IID) and performance? Recent findings regarding the performance effects of IID depict a complex picture with curvilinear relationships and several contingencies. However, firm-specific contingencies on the demand side have remained unexplored. We analyze how IID relates to firm performance (market share) in the German automotive industry using panel data between 1999 and 2008. We specifically focus on a firm's high-quality brand image as a demand-side contingency. We find support for our hypotheses of complex curvilinear relationships as well as for moderating effects of brand quality. Our results have significant theoretical implications for the IID literature.

AB - How do firm-specific, demand-related factors influence the relationship between intra-industry diversification (IID) and performance? Recent findings regarding the performance effects of IID depict a complex picture with curvilinear relationships and several contingencies. However, firm-specific contingencies on the demand side have remained unexplored. We analyze how IID relates to firm performance (market share) in the German automotive industry using panel data between 1999 and 2008. We specifically focus on a firm's high-quality brand image as a demand-side contingency. We find support for our hypotheses of complex curvilinear relationships as well as for moderating effects of brand quality. Our results have significant theoretical implications for the IID literature.

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KW - Intra-industry diversification

KW - Intra-industry diversification-performance relationship

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KW - Intra-industry diversification-performance relationship

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KW - Within-segment product proliferation

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