Innovation as a factor of competitiveness and company’s market dominance

Abstract

Introduction. The article identifies the features of the functioning of the world’s leading technology companies in digital markets. The study is devoted to the identification of key criteria of market dominance on the example of GAFAM companies, in particular, the scope of each company and the growth rate of market value are described. It is investigated that despite the high level of diversification of Internet companies, most of their income and profits they receive from the main activity. For each company, the industry in which it is dominant is outlined.

Purpose. Identification of innovations as an important factor of competitiveness and dominance of the company in the digital technology market; analysing the activities of GAFAM companies to identify the impact of innovation on market dominance of companies on the criteria of key indicators of market value growth rates and research and development (R&D) costs.

During the research such methods were used as: dialectical method and methods of analysis and synthesis – to study the peculiarities of the formation of resource potential of the world’s leading Internet companies; statistical method – analysis of the growth rate of market value and R&D expenditures of the five American technology giants GAFAM; structural and logical analysis – outlining the advanced innovations generated by GAFAM that directly affect the world community.

Results. Emphasis is placed on the specifics of the profitability of the main activities of technology companies, within which the analysis and comparison of elements of the development strategy of corporations Meta Platforms, Inc. and Amazon.com Inc. are made. The dynamics of Internet companies’ expenditures on research and development (R&D) for the last seven years is given. The peculiarity of Amazon.com Inc.’s accounting, which contributes to its leading position in the industry in terms of R&D expenditures, has been identified. The key innovative products of the world’s leading technology companies are considered.