Corporate acquisitions are a ubiquitous feature of today's business landscape and a widely used means by which large firms enter new markets. As large acquirers swoop in to acquire firms in new markets, they are almost inevitably met with a chorus of concerns about the potential effects of their actions on the markets they enter. What is the actual impact of acquisitive entry by large firms on the strategies and performance of incumbents? How do incumbents reconfigure the way they compete after a behemoth enters their market? The authors focus on an important facet of firms competitive positionstheir product mixand propose a framework that explains incumbent firms reaction to acquisitive entry by large firms, as well as the performance implications of these reactions. They test the hypotheses that result from this framework by examining the impact of acquisitive entry across a large number of firms and consumer markets over time: The data cover 839 acquisitions in 583 metropolitan statistical areas in the U.S. banking industry. The results indicate that incumbents are more likely to align their product mix strategy with that of the acquisitive entrant if (1) the incumbent is large, (2) the acquirer's past performance has been strong, and (3) the market served by the incumbent is small. Importantly, how incumbents react has significant performance implications: The authors find that large incumbents that deviate from acquirers product mix strategy perform better than other incumbents do.