Exploring the dark side of inter-firm coopetition: The harmful effect on customer satisfaction

Inter-firm coopetition, the simultaneous presence of competition and cooperation between firms, has gained increasing attention in strategic management research. While scholars have focused on its effect on selected firm outcomes, the impact of coopetition on customer satisfaction remains underexplored. Our study addresses this gap and leverages recent advancements in coopetition research by examining how coopetition, and the intensities of competition and cooperation in alliances, affect customer satisfaction. Analyzing a unique dataset of 1893 alliances across 143 U.S. firms from 1994 to 2021, we uncover three key insights: First, the intensity of competition in alliances is negatively related to customer satisfaction. Second, the occurrence of coopetition is negatively related to customer satisfaction. Third, contrary to our hypothesis, the intensity of cooperation in alliances does not have a positive influence on customer satisfaction. Our findings substantially contribute to coopetition research by shedding light on the rarely studied ‘dark side’ of coopetition and emphasizing the importance of considering customer perspectives in coopetition research. Besides, we provide managerial implications and suggest future research avenues.