Abstract
In 1975 Barilla, leader in the pasta market, entered the biscuit market with the new brand Mulino Bianco and in 1989 reached a very strong leadership position that is still holding. What are the resources and capabilities that drove the competitive advantage of Mulino Bianco and that incumbents were not able to develop and imitate? Why did incumbents' competitive advantage deteriorate? Which were the consequences on the competitive heterogeneity of the industry? These are the research questions of the paper. The paper reviews thirteen years (1977-1989) of competition between brands in the biscuit market, with the goal of analyzing their heterogeneity and of tracking their strategic route. Critical success factors in the biscuit market are identified, operationalized, and measured for each brand and for each year. A statistical procedure is used to identify transition points separating subperiods with distinct strategic group structures; within each period, cluster analysis is applied to segment brands into strategic group; the route of each strategic group is tracked interpreted. Three sub-periods of competitive stability are identified: Period I: 1977-1981. Mulino Bianco introduces a new marketing strategy in the biscuit industry; Period II: 1982-1984: Mulino Bianco joins the big brands and becomes the leader; Period III: 1985-1989: New competitive isolation of Mulino Bianco. The strategy used by Mulino Bianco is the main driver of a continuous increase in the competitive heterogeneity between brands. This increase of the options to complete could be the reason why incumbents were disoriented, lost share, and eventually exited.