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Does business model experimentation in dynamic contexts enhance value capture?

Vendrell-Herrero, Ferran; Parry, Glenn; Opazo-Basáez, Marco; Sanchez-Montesinos, Francisco J.

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Authors

Ferran Vendrell-Herrero

Glenn Parry Glenn.Parry@uwe.ac.uk
Academic Associate Lecturer - BAM

Marco Opazo-Basáez

Francisco J. Sanchez-Montesinos



Abstract

Copyright © 2018 Inderscience Enterprises Ltd. Established theory suggests that firms experiment with business models in dynamic contexts. However, the relationship between business model experimentation and organisational performance remains unclear. For this purpose, we propose an assessment of the economic value of business model experimentation in dynamic contexts by defining the unit of analysis at the industry level. Analysis draws upon a unique panel dataset from the recorded music industry composed of 414 observations from 32 countries for the period 1998-2010. The results show two optimal modes for maximising value capture in dynamic contexts. First, if a dominant format exists, a 'network' effect becomes prevalent which has a positive impact upon revenue. Second, when firms engage in experimentation leading to a highly diversified set of business models the industry sector becomes better able to capture value from diverse and changing consumer needs.

Journal Article Type Article
Publication Date Jul 3, 2018
Journal International Journal of Business Environment
Print ISSN 1740-0589
Electronic ISSN 1740-0597
Publisher Inderscience
Peer Reviewed Peer Reviewed
Volume 10
Issue 1
Pages 14-34
APA6 Citation Vendrell-Herrero, F., Parry, G., Opazo-Basáez, M., & Sanchez-Montesinos, F. J. (2018). Does business model experimentation in dynamic contexts enhance value capture?. International Journal of Business Environment, 10(1), 14-34. https://doi.org/10.1504/IJBE.2018.10014424
DOI https://doi.org/10.1504/IJBE.2018.10014424
Keywords business model, experimentation, value capture, music industry, format density
Publisher URL http://dx.doi.org/10.1504/IJBE.2018.10014424
Additional Information Additional Information : This is the author's accepted manuscript. The final published version is available at http://dx.doi.org/10.1504/IJBE.2018.10014424.

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