Theories on early and late mover advantages predicate that competitive operating advantages can occur with respect to the relative timing of market entry. Suspecting that “early mover” hotels can preempt desirable micro-locations for hotel operations, the current study tests for early mover advantage created by locations not fully imitable. Estimation of spatial econometric model reveals evidence of an early mover advantage. We also find that the effect of depreciation of older hotels may serve as a competitive advantage for new entrants with new facilities, although there was no considerable benefit for late movers. Furthermore, through additional tests we find the early mover advantage consistently significant for both chain and independent hotels. Implications and suggestions for future research are discussed.
AgarwalS.RamaswamiS. N. (1992). Choice of foreign market entry mode: Impact of ownership, location, and internationalization factors. Journal of International Business Studies, 23(1), 1-27.
AnselinL.HudakS. (1992). Spatial econometrics in practice: A review of software options. Regional Science and Urban Economics, 22, 509-536.
4.
BaumJ. A. C.HavemanH. A. (1997). Love thy neighbor? Differentiation and agglomeration in the Manhattan hotel industry, 1898-1990. Administrative Science Quarterly, 42, 304-338.
5.
BaumJ. A. C.IngramP. (1998). Survival-enhancing learning in the Manhattan hotel industry, 1898-1980. Management Science, 44, 996-1016.
6.
BeginS. (2000). The geography of a tourist business: Hotel distribution and urban development in Xiamen, China. Tourism Geographies, 2, 448-471.
7.
BrounenD.CollianderG. (2005). Corporate real estate and stock performance in the international retail sector. Journal of Corporate Real Estate, 7, 287-299.
8.
BrownS. (1987). The microlocational perceptions of city centre retailers. Transactions of the Institute of British Geographers, 12, 337-344.
9.
BrownS. (1992). Retail location: A micro-scale perspective. Avebury, England: Brookfield.
10.
BrownJ. R.DevC. S.ZhouZ. (2003). Broadening the foreign market entry mode decision: Separating ownership and control. Journal of International Business Studies, 34, 473-488.
11.
BullA. O. (1994). Pricing a motel’s location. International Journal of Contemporary Hospitality Management, 6(6), 10-15.
12.
CaninaL.EnzC. A.HarrisonJ. S. (2005). Agglomeration effects and strategic orientations: Evidence from the U.S. lodging industry. Academy of Management Journal, 48, 565-581.
13.
CareyK. (1992). Optimal hotel capacity: The case of Barbados. Social and Economic Studies, 41, 103-126.
14.
CaseA. C. (1991). Spatial patterns in household demand. Econometrica, 59, 953-965.
15.
ChungW.KalninsA. (2001). Agglomeration effects and performance: A test of the Texas lodging industry. Strategic Management Journal, 22, 969-988.
16.
DarrE. D.ArgoteL.EppleD. (1995). The acquisition, transfer, and depreciation of knowledge in service organizations: Productivity in franchises. Management Science, 41, 1750-1762.
17.
EganD. J.NieldK. (2000). Towards a theory of intraurban hotel location. Urban Studies, 37, 611-621.
18.
Espino-RodriguezT. F.Padron-RobainaV. (2005). A resource-based view of outsourcing and its implications for organizational performance in the hotel sector. Tourism Management, 26, 707-721.
19.
FoxallG. R.HackettP. M. W. (1992). Consumers’ perceptions of micro-retail location: Way finding and cognitive mapping in planned and organic shopping environments. International Review of Retail, Distribution, and Consumer Research, 2, 309-327.
20.
GhoshA.TibrewalaV. (1992). Optimal timing and location in competitive markets. Geographical Analysis, 24, 317-334.
21.
HassanienA.BaumT. (2002). Hotel innovation through property renovation. International Journal of Hospitality & Tourism Administration, 3(4), 5-24.
22.
IngramP.BaumJ. (1997a). Chain affiliation and failure of Manhattan hotels, 1898 to 1980. Administrative Science. Quarterly, 42, 68-102.
23.
IngramP.BaumJ. (1997b). Opportunity and constraint: Organizations’ learning from the operating and competitive experience of industries. Strategic Management Journal, 18, 75-98.
24.
IngramP.BaumJ. (2001). Interorganizational learning and dynamics of chain relationships. In BaumJ. A. C.GreveH. R. (Eds.), Multiunit organizations and multimarket strategy (Advances in Strategic Management, Vol. 18, pp. 109-139). Bingley, England: Emerald Group.
25.
IsmailJ. A.DalborM. C.MillsJ. E. (2002). Using RevPAR to analyze lodging-segment variability. Cornell Hotel and Restaurant Administration Quarterly, 43(6), 73-80.
26.
KalninsA.ChungW. (2004). Resource-seeking agglomeration: A study of market entry in the lodging industry. Strategic Management Journal, 25, 689-699.
27.
KlempererP. D. (1987). Markets with consumer switching costs. Quarterly Journal of Economics, 102, 375-394.
28.
LeeS. K.JangS. C. S. (2013). Asymmetry of Price Competition in the Lodging Market. Journal of Travel Research, 52, 56-67.
29.
LeeS. K.JangS. C. S. (in press). Conditional Agglomeration Externalities in Lodging Markets. Journal of Hospitality & Tourism Research. doi: 10.1177/1096348013491605.
30.
LevesqueM.MinnittiM.ShepherdD. (2009). Entrepreneurs’ decisions on timing of entry: Learning from participation and from the experience of others. Entrepreneurship Theory and Practice, 33, 547-570.
LucasA. F.DunnW. T. (2005). Estimating the effect of micro-location variables and game characteristics on slot machine volume: A performance-potential model. Journal of Hospitality & Tourism Research, 29, 170-193.
33.
MakadokR. (1998). Can first-mover and early-mover advantages be sustained in an industry with low barriers to entry/information?Strategic Management Journal, 19, 683-696.
34.
ManaktolaK.JauhariV. (2007). Exploring consumer attitude and behavior towards green practices in the lodging industry in India. International Journal of Contemporary Hospitality Management, 19, 364-377.
35.
MattilaA. S. (2006). How affective commitment boosts guest loyalty (and promotes frequent-guest programs). Cornell Hospitality Quarterly, 47, 174-181.
36.
McCannB. T.VroomG. (2009). Pricing response to entry and agglomeration effects. Strategic Management Journal, 31, 284-305.
37.
MichaelS. C. (2003). First mover advantage through franchising. Journal of Business Venturing, 18(1), 61-80.
38.
OkumusF.HemmingtonN. (1998). Barriers and resistance to change in hotel firms: An investigation at unit level. International Journal of Contemporary Hospitality Management, 10, 283-288.
39.
PelsE.VerhoefE. T. (2004). The economics of airport congestion pricing. Journal of Urban Economics, 55, 257-277.
QuerD.ClaverE.AndreuR. (2007). Foreign market entry mode in the hotel industry: The impact of country- and firm-specific factors. International Business Review, 16, 362-376.
42.
RodriguezA. R. (2002). Determining factors in entry choice for international expansion. Tourism Management, 23, 597-607.
43.
RubinK. E.LesserD. H. (1993). Understanding the unique aspects of hotel property tax valuation. Appraisal Journal, 61(1), 9-19.
44.
SchmalenseeR. (1981). Economies of scale and barriers to entry. Journal of Political Economy, 89, 1228-1238.
45.
SchmalenseeR. (1982). Product differentiation advantages of pioneering brands. American Economic Review, 72, 349-365.
46.
ShamsieJ.PhelpsC.KupermanJ. (2004). Better late than never: A study of late entrants in household electrical equipment. Strategic Management Journal, 25(1), 69-84.
47.
ShankarV.CarpenterG. S.KrishnamurthiL. (1998). Late mover advantage: How innovative late entrants outsell pioneers. Journal of Marketing Research, 35(1), 54-70.
48.
SheldonP. J. (1983). The impact of technology on the hotel industry. Tourism Management, 4, 269-278.
SrinivasanR.LilienG. L.RangaswamyA. (2004). First in first out? The effects of network externalities on pioneer survival. Journal of Marketing, 68, 41-58.
51.
SundboJ.Orfila-SintesF.SørensenF. (2007). The innovative behavior of tourism firms: Comparative studies of Denmark and Spain. Research Policy, 36(1), 88-106.
52.
ThraneC. (2007). Examining the determinants of room rates for hotels in capital cities: The Oslo experience. Journal of Revenue and Pricing Management, 5, 315-323.
53.
UrtasunA.GutierrezI. (2006). Hotel location in tourism cities: Madrid 1936-1998. Annals of Tourism Research, 33, 382-402.
54.
Von StackelbergH. (1934). Marktform und gleichgewicht [Market Structure and Equilibrium]. Vienna, Austria: Springer.
55.
VroomG.GimenoJ. (2007). Ownership form, managerial incentives, and the intensity of rivalry. Academy of Management Journal, 50, 901-922.
56.
WeilerS. (2000). Pioneers and settlers in Lo-Do Denver: Private risk and public benefits in urban redevelopment. Urban Studies, 37, 167-179.
57.
WoodS.TaskerA. (2008). The importance of context in store forecasting: The site visit in retail location decision-making. Journal of Targeting, Measurement and Analysis for Marketing, 16, 139-155.
