The Study of Typology of Competitive Actions in Digital Environment: An Empirical Investigation of Mobile Instant Messaging

The highly competitive and increasingly transparent characteristics of the digital environment have led inter-firm rivalry more frequently. Competitive actions and competitor’s responses together determine firms’ value creation. The key to obtain competitive advantages is to stop or delay competitor’s response. Therefore, our research question is which type of actions is the most effective in digital environment. Grounded in the framework of explorative/exploitative in the organizational learning literature, we organize competitive actions from two dimensions: resources based (strategic versus tactical) and innovation based (innovative versus efficient). This paper studies the competitive actions in mobile instant messaging industry and use structured content analysis to capture firms’ competitive actions. Finally, 113 matched competitive actions and responses were collected. Then, we compare the effects of different types of competitive actions from three aspects, that is the number of responses, response time and response quality. The results show that innovative-strategic action is the most effective action in digital environment. Our action-level study of MIM (mobile instant messaging) promotes better understanding of how firms interact with each other in digital environment. Moreover, the new typology of competitive action helps us identify competitive actions in digital environment more precisely and help managers to better understand industry dynamics thus developing appropriate strategies to compete in the industry.