ALONE OR IN COOPERATION: WHAT IS THE BEST STRATEGY FOR THE PERFORMANCE OF RADICAL PRODUCT INNOVATION IN THE VIDEO GAME INDUSTRY?

Abstract

The aim of this research is to study the impact of inter-organisational strategies on performance of radical product innovation. We distinguish three kinds of strategies: (1) individual strategy, (2) cooperation with non-rivals strategy, and (3) coopetition strategy. We study innovation at the product level, and we analyse the market performance. We develop and test the hypotheses comparing the effects of these three strategies on the market performance of radical product innovation. An empirical research is carried out to study the video game publishing industry. We perform a quantitative analysis on a sample of 100 video games that involve radical innovations, identified among 822 video games launched between 2006 and 2011. The main results show that coopetition is the most fruitful strategy for developing a radical innovation. In this process, a direct competitor becomes the best and the most viable partner for that type of innovation.