When to outsource the sales force for new products

Executives and researchers continue to seek factors that lead to new product success. While prior research has suggested that outsourcing the selling function can help make the innovation process leaner and limit future liability, outsourcing can also pose risks in terms of safeguarding both customer relationships and confidential innovation capabilities. Moreover, examining the effects of outsourcing has been identified as a key research priority in recent marketing literature. Thus, using privileged access to managers in the biochemical industry, we employed a multi-group analysis of 229 new products to investigate the effect of outsourcing the sales force on new product success. Our empirical results demonstrate that outsourcing the sales force moderates the relationship between new product superiority and customer meaningfulness such that the relationship is stronger when outsourcing is employed; however, outsourcing the sales force moderates the relationship between new product good value and customer meaningfulness such that it is weaker when outsourcing is employed. These findings suggest that outsourcing may serve as a signal of added risk for customers. Thus, the decision to outsource the sales force should be made based upon customer needs and the characteristics of the new product.