Market Dynamics

When companies within an industry encounter similar problems they engage in a search for answers, sometimes collectively and sometimes individually. As an idea for a solution emerges, resources begin to group around it. Industry leaders recognize it as a good solution and they begin to talk about it, the industry press picks it up as a story, and vendors begin to target the market that emerges. Figure 18.1 shows the cycle of innovation that ensues.

Figure 18.1. Innovation within an industry occurs around three key resources.

Any of the three key resources (industry leaders, industry press, and vendors) can initiate the cycle and ...

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