Despite the considerable attention from both academics and practitioners to the effects of big data on firms’ performance in innovation, there is a noticeable research gap in exploring such effects on firms’ radical and incremental innovation. As a matter of fact, many studies argue that big data can be a source of innovation for new products and services because firms can collect and incorporate insights from customers, partners, suppliers’ knowledge, etc. However, these studies tend to ignore whether big data can also be a source of radical and incremental innovation. Focusing on firms’ intent of introducing radical and incremental innovation using big data, we employ the Knowledge Based View and the four well known dimensions of big data (i.e., volume, velocity, variety, and veracity) to understand when big data is a source of knowledge for radical and incremental innovation. Performing an OLS regression analysis on a sample of 155 Italian firms, we find that both big data variety and veracity positively affect firms’ radical and incremental innovation. These findings provide insights about the conditions under which big data can benefit firms’ innovation processes, contributing to a more comprehensive theoretical understanding of the opportunities big data bring in the context of firms’ product innovation. Moreover, our findings offer valuable guidance to managers navigating the complexities of leveraging big data for new product development.
