- The Johns Hopkins University series on Entrepreneurship
Edited by Gideon D. Markman and Phillip H. Phan
Chapter 9: Market Niche Entry Decisions: A Retrospective Introduction
Henrich R. Greve “Market niche entry decisions” (Greve, 2000) was written as a contribution along two dimensions of market entry research. The first dimension concerned the mechanism(s) driving market entry, and was a contest between three perspectives: (1) the “pull” of pursuing opportunities; (2) the “push” of learning from past experiences, and (3) the “manoeuvring” of strategizing against competitors. Although all of these mechanisms could in principle operate at the same time, there are at least two implicit conflicts between them. First, learning theory is based on bounded rationality, and is often posed as a contrast to opportunity-based theory that requires better knowledge, and strategic theory that requires higher rationality. Second, strategy theory may call for entry into areas that are less promising opportunities in the short run, but sets up a better game against the competitors in the longer run. Hence, the mechanism dimension was a real contest rather than a contrived one. However, to take into account bounded rationality, the “pull” argument of pursuing opportunities relied on simple counts of competitor entries that assume only that managers view the entries of others as informative of their own opportunities (e.g., Greve, 1996). The second dimension concerned the difference between small and large organizations, which tested two interrelated arguments. First, the survivor bias will make small organizations appear to be more path-dependent in their entry decisions even if they follow the same learning rules. A small organization that still expands is likely to have experienced only successes, and hence...
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