While innovation is on everyone’s lips, for product companies it is not the only way to grow. In reality, many successful businesses win by adopting proven ideas and focusing on execution, scale, and focus rather than invention. This post explores why imitation is not a second-best option for product companies, but a different strategy that comes from a deliberate choice. So, should the choice go for innovation or imitation for a product strategy?
The value of innovation
The word innovation suggests something new, whether a new idea or a new busines model. Thanks to innovation our society has evolved. Many companies, regardless of size or industry, continuously have innovation topics on their agenda. Not doing so would appear as stagnation or decline.
Innovation distinguishes between a leader and a follower
Steve Jobs
But is innovation for every company? As simple as it sounds, this question is still very important, especially in the strategic room. Many executives, whether CEOs, CTOs, or chief product officers have questioned themselves and their teams whether innovation is the only strategic choice to make. After all, innovation can be costly. It often requires new assets, people and time. And the result is far from certain.
So, is innovation the only way to grow? Many leaders want to adopt innovation to be successful in their industry or customer segment. However, a market can have only a limited number of innovators. Indeed, if every successful company relied on innovation, competition would collapse into monopolies, which is clearly not how most industries function.
When imitation is better than innovation
In a new article published in 2025 on Harvard Business Review, researchers Felipe A. Csaszar, Rebecca Karp and Maria Roche suggest that before deciding how to innovate, companies should ask whether it might make more sense to imitate instead. They argue that the choice on whether to be an innovator or an imitator depends on a firm’s relative position in the industry. The conclusion is that in some cases imitation can be more effective and lucrative than attempting to chart an entirely new course.
If a product targets a new market or a company operates in a nascent industry, innovation works best. Conversely, if a firm operates in a mature industry, its strategy should be more to imitate and focus on proven models to catch-up with innovators.
What makes a great imitation
What is imitation really? Imitation is the intentional adoption of a proven business model or technology in order to compete. Imitation does not imply copying blindly. While imitators “borrow” a core product idea or business model, they execute it differently. For example, they rethink where to position a product on the market, how to distribute it, or which geography to address.
An example of imitator is Rocket Internet, a Berlin-based startup incubator and venture builder that became famous in the late 2000s for systematically copying successful American internet business models and executing them in Europe and emerging markets.
Imitators usually enter a market when at least the following conditions apply:
- Customer segment is validated
- There is enough willingness to pay to justify a profit margin
- Business risks are visible and acceptable
- Technical feasibility and trade-offs are clear
As a result, they can commit capital with more confidence and avoid the bets that first movers often face.
For the economy as a whole, imitation is not a bad thing either. According to the 2012 book by Kal Raustiala and Christopher Sprigman “The Knockoff Economy: How Imitation Sparks Innovation” imitation diffuses proven ideas quickly, lowers the cost of market experimentation, and exposes unmet consumer preferences.
Example from the generative AI race
As a practical case, consider how some of the most capitalized companies in the world have entered the market for generative AI tools.
OpenAI is seemingly an innovator because it made early, foundational advances in large language model development and, crucially, in their large-scale deployment.
By contrast, Google, Microsoft, Meta, and Amazon are imitators in this market. They entered after the core paradigms were established and compete primarily by integrating generative AI into existing products, platforms, and markets where they already have leadership.
Another deliberate imitator in this market is Apple. It entered the race after generative AI paradigms were established and demand was validated. On the other hand, Apple focuses on integration, privacy, and user experience rather than on defining the underlying large language models.
Imitation or Innovation, which one to choose?
Innovation remains the most rewarding path for companies that create new markets, reach new customer segments, or continue pushing the boundaries of existing products. Without innovators willing to take early risks, absorb uncertainty, and explore unproven ideas, there would be nothing to imitate.
On the other hand, imitation is not failure or a compromise. It is a form of strategic adaptation that reduces risk, saves resources, and accelerates execution. While some stakeholders might dismiss imitation as dull or uninspiring, it is often the most effective way to catch up with competitors, to bring existing innovations into new territory, or to build the capabilities required to sustain innovation.
This brings an often-overlooked challenge for managers. It is to diagnose where they are, or aspire to be, in an industry and make an informed choice for their product or company to be an innovator or an imitator.