Research on Market Entry Order and Product Development Strategy of Aerospace Components Based on Game Analysis

Abstract

Focusing on the decision-making confusion of aerospace components manufacturers in market entry order and product development strategy, a market entry game theory model based on the conversion cost and learning curve effects, as well as a product differentiation with downward compatibility game theory model is established. Game analysis shows there is a significant first-mover advantage in the aerospace components market, while adopting a downward compatible strategy may provide a second-mover advantage. The study has two implications. First, companies must strive to be the first mover into the market; second, the incomers should adopt a downward compatible product differentiation strategy.