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1. Introduction
Emerging markets differ on many fronts from developed ones, and this has implications for strategy development and implementation. Factors such as culture, institutional conditions and market uncertainties set emerging markets apart and, therefore, require a careful look by scholars to appreciate fully the management challenges faced by firms operating in such markets. Context matters in management (Hoskisson et al., 2000; Boso et al., 2013) and specifically in marketing (Hunt, 1991). As the emerging markets have evolved from the fringes to the core of marketing practice and from a non-profitable market position to a lucrative one, we need to take note of such markets’ uniqueness. Such an approach will help us question the existing practices and perspectives of management and marketing that have been developed largely in the context of industrialised markets. Emerging markets have implications for international marketing practice and for research regarding consumption, sales and strategy. They are said to be experiencing fast growth (Cavusgil et al., 2002) and present a lot of opportunities as well as threats for business generally in such environments (Sheth, 2011). These markets present a unique opportunity for management scholars to investigate the dynamics of business operations; environmental idiosyncrasies; and competition and firm performance. In spite of the notable shift in wealth creation from developed economies to emerging economies (Bruton et al., 2013), it appears scholars have not paid the needed attention to these markets. Such neglect creates a knowledge gap as the theoretical insights emerging markets may offer to international marketing and management are critical for future understanding/interpretation. In the current competitive business environment, emerging market firms are looking for sources of advantage that can position them above the competition, improve their productivity and increase bottom lines. One of such sources that can create sustainable competitive advantages for firms is the exploitation of internal strengths and external opportunities through innovation (Barney, 1991; Porter, 1985). However, the key question that begs an answer is how emerging market firms can create competitive advantages through the exploitation of innovation as a strategic option. This study seeks to answer the question:
How can innovation leadership create a competitive advantage for firms operating in emerging markets?
This study answers this question by examining the critical role...