Disruptive innovation, innovation adoption and incumbent market value: The case of Airbnb

Florian J. Zach, Juan Nicolau () and Abhinav Sharma

Annals of Tourism Research, 2020, vol. 80, issue C

Abstract: The purpose of this article is to analyze the market value impact of actions taken in response to disruptive innovation; specifically, actions that incumbent lodging firms implement to adopt the innovation of peer-to-peer trading-based accommodation rental. As incumbent firms need to device strategies to accommodate the disruption stemming from a new entrant with a disruptive business model, we analyze the differentiated efforts of four incumbent lodging firms to compete with the peer-to-peer lodging firm Airbnb. This study is the first to quantify the effects of innovation on incumbent tourism firms challenged by a disruptive entrant. It finds that adoption speeds, that is first vs. late adoption, make a difference as the former are awarded a significant increase in market value.

Keywords: Disruptive innovation; Innovation adoption; Market value; Incumbent response; Peer-to-peer lodging; Event study (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (16)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:anture:v:80:y:2020:i:c:s0160738319301756

DOI: 10.1016/j.annals.2019.102818

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