A dynamic product view of diffusion incorporating timing into the adoption process

                         Haggblom, Ted Aron; PhD

                         MICHIGAN STATE UNIVERSITY, 1996

                         New Products are often vital to the success of the firm and marketers must be concerned with the rate of
                         diffusion, or marketplace acceptance, of a new product. Previous studies of diffusion have generally
                         regarded the innovation as a single product diffusing unchanged throughout the population of potential
                         adopters. Under this static product view, potential adopters were assumed to evaluate the product and
                         make a single adopt/nonadopt decision. This research proposes a dynamic view of diffusion that allows
                         consideration of successive generations of a new product. Conceptualizing the innovation in
                         evolutionary terms means incorporating into the adoption process a timing decision that permits the
                         potential adopter various postponement options. An experiment was designed to simulate the decision
                         facing a potential adopter confronted with successive generations of a new product. A sequential logit
                         model was used to analyze the influence of new product characteristics on both the evaluation and
                         timing stages of the decision process. The results indicate that product characteristics have differential
                         impacts on the two stages and that a favorable attitude toward a new product does not preclude
                         postponement of adoption. This model helps explain the frequently observed time lag between
                         awareness and eventual adoption of an innovation. The model was also used to test the hypothesis that
                         positive disconfirmation of performance expectations has an inverted U-shaped moderating effect on the
                         positive relationship between performance and both evaluation and timing. After manipulating next
                         generation performance expectations in the experiment, the results confirmed this effect. The
                         implication is that better than expected performance improvements may come as a pleasant surprise,
                         adding to the positive influence of performance on evaluation and adoption timing. However, products
                         that are perceived to be improving much more rapidly than anticipated may create a dissonance that
                         inhibits the otherwise positive relationship between performance and the likelihood of a favorable
                         attitude and subsequent adoption.

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