Business model innovation and business concept innovation as the context of incremental innovation and radical innovation

• Business model innovation modifies the context of internal innovation.
• Business concept innovation modifies the logic and patterns of internal innovation.
• Innovation strategy, business concept, and business model are interrelated.
• Business concept innovation is a central pillar in business model innovation.
• Successful innovation is not only about technological and scientific progress.

Innovation is a means for obtaining competitive advantages in the tourism and hospitality sectors. However, the innovations, knowledge, and technologies acquired may be easily accessible for competitors. This study, which is based on interviews with 115 senior managers, seeks to show how tourism and hotel firms innovate, and how the achievement of successful innovations is possible. A model for business innovation is proposed, which takes full advantage of internal and external sources of innovation for the generation of sustainable competitive advantages. The findings show the effects of business model innovation and business concept innovation. The adoption of new models and concepts that support innovation are shown to be important. Specifically, the keys to successful incremental and radical innovations lie in adopting a new contextual and conceptual framework through which innovations can occur and customer needs can be met, thereby giving rise to new competitive advantages.