Transcript New Products & Innovation

Marketing
Communications and New
Product Adoption
6
Case 1: New Product Adoption
The Internet
• 2001:
63% U.S. HH own computer
57% HH connected to Internet
How long will it take for Internet to reach
100% penetration?
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Case 2: New Product Adoption
Television
• 1947-1955: Took 8 years to reach 63%
penetration
• Took another 30 years to reach current
penetration of 98%
• Would you expect Internet to reach same
98% level? How long would it take?
Faster or slower than for TV?
• What are some considerations that shed
light on these questions?
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New Product Adoption:
The Internet vs. TV
•
3
New Product Adoption:
The Internet vs. TV
•
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New Products & Innovation
New
flavors,
sizes,
packages
Annual new
models in
cars;
New fashions
First
introduction
of compact
cars;
Color
television
Invention
of
computer;
Jet aircraft
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Adoption Process
Relative
Advantage
Innovation
Related
Characteristics
Compatibility
Observability
Trialability
Complexity
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Relative Advantage
• A product innovation is perceived as
better than existing alternatives
• Positively correlated with an
innovation’s adoption rate
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Relative Advantage
An illustration of
relative advantage
Relative Advantage
Another illustration
of relative advantage
Compatibility
• An innovation is perceived to fit into
a person’s way of doing things
• The greater compatibility, the more
rapid a product’s rate of adoption
• Overcome perception of
incompatibility through:
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Compatibility
A compatibility
problem
Complexity
• An innovation’s degree of perceived
difficulty
• The more difficult, the slower the rate
of adoption
• Examples?
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Complexity
Offsetting perceived
product complexity
Trialability
• An innovation can be used on a
limited basis prior to making a full
blown commitment
• The trial experience serves to reduce
the risk of a consumer’s being
dissatisfied with a product after
having permanently committed to it
through outright purchase
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Adoption Process
An effort to
promote
vicarious trial
Observability
• The product user or other people can
observe the positive effects of new
product usage
• Higher the visibility, more rapid the
adoption rate
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Adoption Process
Relative
Advantage
Amazon
Kindle 2.0?
Compatibility
Observability
Trialability
Complexity
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Case 3: New Product Adoption
Go-Gurt
How to get kids & teens to eat yogurt?
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Stimulating
Word of Mouth Influence
• Impersonal sources:
• Personal sources:
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Stimulating
Word of Mouth Influence
• Positive word-of-mouth communication
is critical in the success of a new
product or service
• Unfavorable WOM have devastating
effects because consumers seem to
place more weight on negative
information in making evaluations
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Opinion Leader
• A person who frequently influences
other individuals’ attitudes or overt
behavior
• An informer, persuader, and confirmer
• Influence is typically limited to one or
several consumption topics
• Influence moves horizontally through a
social class (not across)
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Opinion Leaders
Characteristics
•
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Opinion Leaders
Market Mavens
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Tactics: “Seeding the Market”
• Supplying advance samples in key
markets to people who are likely to
be influential.
• Finding cheerleaders who will get
the talk started.
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Creating “BUZZ”
• Law of the Few
• Stickiness Factor
• Power of Context
Igniting Explosive Demand
1.Design the product to be unique,
visible
2. Select and seed the vanguard
3. Ration supply
4. Use celebrity icons
5. Tap the power of lists
6. Nurture the grass roots