Innovations: Adoption, Resistance, Diffusion

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Chapter 15

• Innovations Adoption, Resistance, Diffusion

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Learning Objectives Ch. 15

• To access
• Classifications of innovations, benefits offered
  breadth
• Adoption of innovation, why consumers resist
  innovation, timing of innovation
• Diffusion its relationship to the product life
  cycle
• Factors affecting adoption, resistance,
  diffusion

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Adoption of, Resistance to Diffusion of
Innovations
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Innovation

• an offering that is new to the marketplace
  a product, service, or ideaconsumers within a
  market segment perceive as new that has an
  effect on existing consumption patterns.
• Innovations can be new products or new
  services
• What is an example of a new service
  innovation that has changed your life for the
  better?

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Characteristics of Innovations

• Degree of novelty
• Continuous
• Dynamically continuous
• Discontinuous
• Benefits offered
• Functional
• Aesthetic/hedonic
• Symbolic
• Breadth

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Innovation Continuum
Discontinuous Dynamically continuous Continuous D
epends on degree of behavioral change What are
examples of each part of the innovation continuum
spectrum?
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Adoption/Resistance to Innovations

• Resistance (e.g., retail resistance, market
  resistance)
• People are inherently resistant to change to
  things they are uncertain of
• Adoptionhierarchy of effect
• High-effort
• Low-effort
• Timing of adoption decisions
• Characteristics of adopter groups
• Application of adopter group categories

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High Low Effort Hierarchy of Effects
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Profile of Adopter Groups
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Use-Diffusion Patterns
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Marketing Advertising Implications

• Demographics
• Social influence
• Personality
• Cultural values
• Media involvement
• Usage
• Event marketing
• Social media

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Diffusion of Innovations

• reflects the behavior of the marketplace of
  consumers as a groupthe percentage of the
  population that has adopted an innovation at a
  specific point in time.
• Why do some goods diffuse quickly, while
  others lag?

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Diffusion PLC

• Pattern of adoption/diffusion curve
• S-Shaped associated with risk
• Exponential little risk, switching cost low
• Product life cycle stages (PLC)
• Introduction
• Growth
• Maturity
• Decline
• Can a product stay in one PLC cycle for eternity?

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PLC Curve
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S-Shaped Diffusion Curve
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Exponential Diffusion Curve
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PLC Pattern

• Fad
• Fashion
• Classic
• Note that PCL is at the product level, not the
  brand level

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Innovation Characteristics

• Perceived Value
• Perceived Benefits
• Relative Advantage
• Use innovativeness
• Perceived Costs
• Risk/Uncertainty

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Creating Advantage to Switch

• Communicate/ demonstrate advantage
• Price promotions to reduce perceived costs
• Provide incentives to switch

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Consumer Learning Diffusion

• The following impact diffusion rate
• Compatibility
• Trialability
• Complexity

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Social Relevance

• ObservabilityOthers Using Innovation
• Social Value
• Socially desirable
• Speeds diffusion
• Legitimacy Adaptability

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Social System

• Characteristics
• Modernity
• Homophily
• Physical Distance
• Opinion Leadership

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Consequences of Innovation

• Consequences to consumers, businesses, society
• May offer new relative advantages
• Negative consequences may arise
• Social
• Economic

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Questions?