The Impact of Market Knowledge Competence on New Product Advantage: Conceptualization and Empirical Examination

TLDR

Market knowledge competence is widely assumed to enhance new product advantage, yet empirical studies are scarce due to a lack of a clear definition. This study defines market knowledge competence as the processes that generate and integrate market knowledge. The authors test this conceptual model with data from the software industry. The results show that all three processes positively drive new product advantage, which in turn improves product market performance, and that top management’s perceived importance of market knowledge exerts the strongest influence on these processes.

Abstract

Although the role of market knowledge competence in enhancing new product advantage is assumed widely in the literature, empirical studies are lacking because of an absence of the concept definition. In this study, the authors conceptualize market knowledge competence as the processes that generate and integrate market knowledge. The authors test the conceptual model using data collected from the software industry. The findings show that each of the three processes of market knowledge competence exerts a positive influence on new product advantage. The results also reveal a positive association between new product advantage and product market performance. The findings regarding the antecedents indicate that the perceived importance of market knowledge by top management has the largest impact on the processes of market knowledge competence.