Explore new markets: Issue

Evaluating a new market is a little like pioneering: there may be no maps of the territory, and only the very vaguest of intelligence about its size and scope.

Management science has vacillated over the benefits of 'first mover advantage' - some pundits pointing out that the first to stake their claim can dominate their chosen sector: others countering with the argument that pioneers most often forge a path which is more profitable for others.

The truth is that this single factor is not the sole determinant of success or failure. Studies have shown* that lack of good market research is the most common cause of failure for new ventures.

Why, indeed, should that surprise us? An unprepared 'first mover' is more likely to fail than a late-arriving counterpart, because they will at least have learned from the successes and failures of the pioneer. A well prepared pioneer however may be able to establish a beachhead in a new market that others will find difficult to displace.

The determining factor is not who moved first, but their preparedness, having decided to move.

* Robert G. Cooper - Winning at New Products