INNOVATION
Imitation As An
Innovation Strategy
By Senorine Wasike
T
heodore Levitte, a legendary
marketing scholar and former
Harvard Business Review editor
defined innovation as either newness
in the sense that something has never
been done before or newness in that it’s
something that has not been done before
by the industry or by the company now
doing it.
The question is if it has been done before is
it imitation or an innovation? Innovators
are first movers or pioneers who come
up with original ideas about service,
product or process with the key objective
of differentiating themselves from other
industry players. Imitators are followers
who copy a competitor’s innovation.
Most executives shun imitation as a
strategy because it is associated with
a lack of originality but a look around
us will reveal that most companies are
imitators. Companies pursue imitation
as a strategy when they wish to lower the
costs and risks associated with innovation.
Rather than go for breakthrough
innovations, firms are increasingly aiming
for faster development cycles that avail
new products faster and cheaper. This is
achieved by copying certain aspects of
innovation and improving on the new
offering.
Should You Innovate or
Imitate?
The Blue Ocean strategy popularized by
Chan Kim and Renée Mauborgne has
been adopted by many companies seeking
differentiation. By looking for unexplored
new markets firms can create new
products or services and enjoy pioneering
status. This approach rides on the first-
mover advantage to achieve a competitive
advantage in the long term. The imitation
strategy aims for the second position as a
fast follower. Both approaches have merits
and demerits. For instance, pioneers do
not always retain market dominance as
it’s neither a factor of being the first, or
To succeed, firms must actively seek out
ideas worth copying not just within the in-
dustry and region but beyond. The magic is
not in just copying but in being able to avail
a better and cheaper copy. The approach
of availing a new product or service that is
better at a third of the price is disruptive to
the innovators. Imitators win more through
disruptive innovation if they must outcom-
pete the pioneers.
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a fast second.
Imitation is widely viewed as an agent
of change and as a twin process of
innovation. By observing and learning
from the pioneers, imitators save a lot
of costs incurred by the first mover in
the areas of research and development
(R&D), marketing and advertising. China
has been very successful in adopting
this strategy by exploring the legality
of imitation. This has allowed China to
come up with new brands that are similar
to the original version.
So, should companies imitate more
than they innovate? There is a place for
both. A firm can be smart about how to
innovate and imitate at the same time.
Take the example for Pfizer, a global
pharmaceutical company which faced a
lot of pressure for revenue from generic
drugs. Generic drugs contain the same
ingredients as the brand name drugs but
are sold at a discounted price (up to 85%
lower). The price discount is attributed to
savings from not investing in R&D.
With increasing pressure on return on
investment, Pfizer decided to enter into
the generic drugs market an indication
that companies can learn from copy cats.
Increasingly, Pfizer is also outsourcing
some R&D to small companies and
university labs and buys up little
innovators or license the discoveries when
a breakthrough looks promising.
Imitation Pays Off
According to a Harvard Business Review
research carried out less than a decade