Assessing the Influence of Innovation Strategy in Enhancing Competitive Advantage: Evidence from the Soft Drinks Industry in Lagos, Nigeria

Abstract

This study examines the relationship between innovation strategies and competitive advantage in selected soft drink companies in Lagos State, Nigeria. A survey research design was employed to collect data from a sample of 376 staff members from relevant departments. The sample size was determined using Raosoft's sample size calculator, with a confidence level of 95%, a finite population size of 1,153, and a maximum acceptable error margin of 5%. To ensure representativeness, 30% of the initial sample size was added. A questionnaire adapted from existing literature was validated through face and content validity tests, and the Cronbach's Alpha reliability coefficients indicated satisfactory reliability (innovation strategy: 0.765; competitive advantage: 0.798). Descriptive and inferential statistics, including simple linear regression analysis, were employed to analyze the data. The overall response rate was 94.7%. The regression analysis revealed a significant positive relationship between innovation strategy and competitive advantage, with innovation strategy accounting for 30.1% of the variation in competitive advantage (R2 = 0.301; B = 2.44; t = 12.72; p < 0.05). This study concludes that innovation strategy is a significant predictor of competitive advantage in the soft drink industry. Therefore, the study recommends that soft drink companies prioritize market research to identify customer needs, segment markets, and clarify niche target markets to achieve superior customer satisfaction and gain a competitive edge.