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The Globalization of Magazines in India: A case study
Unformatted Document Text:  4 environmental uncertainty and governmental interference and wish to diversify risk, while the wholly-owned mode is preferred when property rights protection is weak and when long-term profitability is the goal. He concluded that, ―An appropriate entry mode will enable an MNE to benefit more from location-specific advantages and structural opportunities in the market‖ (p. 465). Market entry timing is another dimension of globalization strategy that has received considerable attention in the research literature with little consensus over whether early entry into a market confers an advantage. The first mover advantage is described as the ability of a pioneering firm to earn positive economic profits, i.e. profits that are in excess of the cost of capital (Lieberman & Montgomery, 1988). The theoretical explanations for this advantage fall into two broad categories— economic and behavioral. Economists see first mover advantages resulting from barriers to entry that the late entrant faces. These include scale effects, experience effects, asymmetric information about product quality, differences in the marginal effects of advertising between first and later entrants, reputational effects, buyer switching costs, technological leadership and preemption of scarce resources. On the behavioral front the most significant source of advantage stems from the first mover‘s ability to preempt the perceptual space. Since consumers know little about the new product, the first mover‘s product shapes perceptions about the product and can determine what attributes are valued and what characteristics are perceived as ideal (Kerrin. et. al., 1992). However, researchers have also identified advantages that accrue to late movers. Late movers can set prices lower than the early entrant, out-advertise or out

Authors: Shrikhande, Seema.
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environmental uncertainty and governmental interference and wish to diversify risk, 
while the wholly-owned mode is preferred when property rights protection is weak 
and when long-term profitability is the goal.  He concluded that, ―An appropriate 
entry mode will enable an MNE to benefit more from location-specific advantages and 
structural opportunities in the market‖ (p. 465). 
Market entry timing is another dimension of globalization strategy that has 
received considerable attention in the research literature with little consensus over 
whether early entry into a market confers an advantage.   The first mover advantage is 
described as the ability of a pioneering firm to earn positive economic profits, i.e. 
profits that are in excess of the cost of capital (Lieberman & Montgomery, 1988).  The 
theoretical explanations for this advantage fall into two broad categories— economic 
and behavioral.  Economists see first mover advantages resulting from barriers to 
entry that the late entrant faces.  These include scale effects, experience effects, 
asymmetric information about product quality, differences in the marginal effects of 
advertising between first and later entrants, reputational effects, buyer switching costs, 
technological leadership and preemption of scarce resources.  On the behavioral front 
the most significant source of advantage stems from the first mover‘s ability to 
preempt the perceptual space.  Since consumers know little about the new product, the 
first mover‘s product shapes perceptions about the product and can determine what 
attributes are valued and what characteristics are perceived as ideal (Kerrin. et. al., 
However, researchers have also identified advantages that accrue to late 
movers.  Late movers can set prices lower than the early entrant, out-advertise or out 

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