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This 0 page Class Notes was uploaded by Nikki spagnola on Saturday February 27, 2016. The Class Notes belongs to MARK 40243 at Texas Christian University taught by Sarang Sunder in Fall 2016. Since its upload, it has received 104 views. For similar materials see Product and Brand Innovation in Marketing at Texas Christian University.
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Date Created: 02/27/16
What is a product 01122016 A product is anything that is of value to a consumer and can be offered through a voluntary marketing exchange o It could be goods services ideas organizations communities etc In exchange of paying for a product in a form of data instead of money Ex twitter 0 Actual product brand name quality level packaging featuresdesign Associated services nancing product warranty product support New product innovations Innovation The process by which ideas are transformed into new offerings including products services processes and branding concepts that will help rms grow Ex Kinect gaming device turned into quotdepth sensors for drones and robots Kinect is a product innovation that now has associated services Why do rms create new products A new product can be anything from a slight redesign to newtothe world offerings Ex Nokia cell phones 0 Changing customer needs 0 Market saturation o No new customers customers are slowing down and have to think about new users and new ideas 0 As the market gets saturated competing on price only the consumer wins the price war Fight on price Look for new innovations Expand to new markets 0 Managing risk through diversity mitigate risk 0 By launching new products on a consistent basis CocaCola can manage their risk by diversifying their risk If one fails that s ok because there is more Are pioneers alwaySsuccessful Pioneers radically change competition and consumer preferences 0 After establishing the market pioneers rst movers switch to 39defender mode to fend off competition What made the iPhone successful Product Multitouch Advanced OS and usability 0 Data contracts 0 Design Branding Challenger to conventional norms Exceptional customer experience Easy to learn amp use Conforms with apple s brand personality What is the touchscreen What is the emailtextinternet Was it the inbuilt music player Innovation in combination with branding is what is really important for success What makessome products fail The marketer is the one who really understands the customer marketing research helps us understand the customer more and more Forecasting is a marketers job Mosquito Magnet 0 Unable to sustain demand forecasting problem 0 Windows Vista 0 Brand perception problem CocaCola C2 medium calorie soda 0 Not really understanding the customer 0 Analyzed the data wrong Febreze sense stories 0 Not educating the customer Why are we studying new product development It is incredibly difficult o Expensive o NPD tends to be an expensive process and a risky one o In 2000 it was 15 M Avg today It is 4x Forbes 0 Ask CocaCola new coke 0 Ex Pharmaceuticals 1 billion to launch drug 125 years to market 10 success rate to trial 2 success rate to market 0 Many ideas never make it to market 0 For every 100 ideas under 70 make it past initial screen fewer than 50 past the concept evaluation and testing and are moved to the development phase a little more than 30 make it through development about 30 make it through testing about 25 of them are commercialized and about 15 are considered to be successes Markham and Lee 2013 o What of ideas actually become successful products 15 of 100 signi cantly smaller 0 Success rates commercialization to success are low 0 The odds of a product being successful are pretty low 0 Ranging from 51 CPG to 65 Healthcare A marketers job ensures that the percentages move upwards Can you be good at NPD Best vs the rest Chart on slide There is an incentive for marketers to be innovative Some very innovative companies that you may not have heard about Warby Parker eyewear o For building the rst great madeontheinternet brand 0 Alibaba 0 25 billion IPO 0 Yu e Bao nternet Finance 0 Yu Le Bao Crowd funded lms 0 Virgin America 0 Perfecting customer service for an innovative clientele 0 ln ight social networks 0 Recruit frequent iers for new ideas VXNEXT 0 Strong international growth 0 String of hit shows 0 HBO GOampHBO NOW lnventure 0 Global credit score of micro nance MPESA o Reinvent mobile payments in emerging markets especially Kenya What are the success factors 0 Does the product satisfy customers perceived needs 0 Relative advantages visavis competition Propensity of customers and the rm to defend the market 0 Size and growth rate of the target segment o Is the rm a pioneer or a follower Cost and engineering advantages in producing the product 0 Creativity of the marketing plan Wellmanaged NPD processes are a signi cant source of performance improvement Decrease development time by 3070 0 On slide What is a new product Are there types 0 New to the world 0 Ex Polaroid camera innovative ideas 0 New to the rm Product line extensions 0 Ex Apple wants to get into the car industry 0 Addition to existing product lines o Improvements and revisions 0 Ex Operating systems keep improving over time Repositioning 0 Made a mistake Ex Old Spice 0 Gambling at New Products Why would anyone play poker Why be a professional poker player 0 Everyone has the same chance of winning before dealing right 0 New products high stakes gambling table 0 High risk high reward 0 You get pot committed The second you must know when to cut your losses and get out o Armature next to professional poker player is like armature next to professional basketball player 0 As more cards are revealed the true winners emerge but the stakes rise exponentially New product development is a lot like sitting at a high stakes gambling table most skilled player always sins o Risks are high payouts are high The NPD Procesi Phase 1 Phase 3 Phase 5 Ev u m t Ideal ml 39 aiaI 39 1 quotThe Flopquot Fuzzy Firm End l E DirEmit g c a i 391 gt 39 warm What kind of opportunity is out there what kind of solution solves that opportunity and how do I move that into a concept 0 Identify direction 0 As a marketer you need to gure out opportunities and then decide where to look for new ideas to solve these market needs 0 After writing the review how do you lter down to two speci c concepts 0 Ideas that not just solve an opportunity but also longterm growth 0 What kind of expansion strategy should we have 0 What is this product functionalities what market need does this product satisfy internally verify products ldlea Generatin I 9 HI I 93 39 i RampD 39 115 1 Erajijftatnrmj g I Mk W m Wag a g u a l n 1 C mpetiti I w A 39gmmieTm E Cuatiamer Inputs 1 E5 0 Licensing 0 Motorola was a research intensive rm that owns a lot of patents in the mobile technology base so Google bought those patents by purchasing the company itself 0 Company s have partnerships with computer science all over the industry University centers are great centers for research andinnovann 0 Internal RampD 0 Most expensive form of idea generalization Customer inputs 0 The biggest number of business products comes from consumers Important points to note during Opportunity identi cation rtl Liszt Features a C nm 1 1 Availability Price Adve rtisingi etc EillEE Seeking information from customers is great 0 But customers may not always be able to articulate the need 0 Sometimes innovations come from the rm itself 0 Know the difference between a need and a solution 0 A 3268 memory on a phone is not a need 0 Customer needs describe how a product is used not how it is built 0 Understand the relationship between customer needs choices and product features Lens model 0 The lens model ends with choice what the consumer really wants simpli es how consumers make decisions Choice could be preferences availability or even a combination of the two a Preference does not equal choice preference helps the customers make a decision The product features create perceptions of superiority 6 is greater than 7 so we buy 7 Psychosocial cues in uence availability and perception Customer decision making process preference model 0 Need recognition Seek information Evaluate alternatives Externally amp internally Choice Purchase amp consumption 0 To help the customer along either increase availability or change something with the price Postpurchase evaluation Did I make the right decision 0 Cognitive dissonance Regret from purchase Concept Testing 0 Concept is a brief writing description of the product 0 Customers reactions determine whether or not it goes forward Triggers the marketing research process quotThe Turnquot The ll illPlZ FFUCEEE Tile iver Fuzzy Front End g mammal T Emma L a WWW 1 mm mwm tw Emu It I I Should we go ahead and develop this product Product Development 0 Prototype 0 First physical form of the product 0 Alpha testing 0 Internal 0 Usually longer and happens at the end of product development 0 Beta testing 0 External potential consumers or product experts 0 Usually shorter and happens just before product launch 0 Google labs most software releases i059 quotThe Riverquot The lNlPD Process The River Fuzzy Front End E Ea r i 1 W 39F EEEHW a T Developed it to a point where there is no aw then see if there is a market test that can be conducted 0 Market test focusedbased group Retrospective evaluate yourself Have I done a good job Lasttask De ne the metrics important to you at phase 1 and use nancial and marketing metrics when evaluating yourself in phase5 0 Financial metrics Evaluate based on revenue sales market share pro t and market gap 0 Marketing metrics Evaluate based on customer satisfaction and Brand image Markt TEETH mamas httpirfhwwwuutuba E mMEitiEhVZ39WHEHEEEHE a SEES H i pm m launch quot E39KFEEEI39II quot Mme experimve i Wreyedl 15153 mr w A NEW 53133 39 isea mt i fuma it nil 39 BE tmhugck alaz h lquot 33135 Furthaae Etc cmaduded Haird F i r quot n TEEfi f marketing Frnduct Lunch Marketing Mix Poker rule for product develonment 0 Count the cards 0 Gather information and do your research 0 Have solid betting criteria 0 Know how much to bet 0 Figure our the pot odds 0 Know when to fold Remember you are not at the table alone 0 Figure out the competition and the customer The world is not static Caveats This neat linear sequencing of phases are likely to become ugly and nonlinear with several feedback loops 0 Pressure for rms to accelerate time to market for new products 0 Causes overlapping of phases 0 NPD is not a departmental process There are several functions that play a role marketer designer engineer o It is multifunctional 0 Marketing design manufacturing All play roles in all the phases 0 The Pioneering Advantagg quotFirst Moverquot or Pioneer 0 The rst appearance of a new brand in a distinctly new category First mover advantage 0 Dominance in share and pro ts of the rst entrant in the category lithe Pioneering Advantage liteans Why It Elli ulld Exist Pr ueer Eased Reasons Hamster Based Reasons Producer Occupy the Niche Create perception that the company is innovative Build a wall around customer Barriers to entry Economies of scale for every new product the marginal cost decreases over time out produce competitors 0 You are able to learn from your consumers much faster Consumer Certain brand perception Potential to create habits By being the rst company in the market you can be the evoked set to the consumer Ex First smart phone we think of is apple Evoked sets Pinterest llhe Pioneering Advantae Recn3 WW It Should NUT EHii t Eunsmmer Based Producer Biased Producer Markets that has very little brand loyalty If you are a rst mover the secondguy can free ride on you Easily compete and copy Technology is consistently changing slowing down the advantages of rst movers Incumbent Inertia wait too long Consumer Company s don t identify what their positioning is Ex McDonalds McCafe Golder and Tellis JMR 1993 47 of pioneers fail Pioneers are market leaders usually for 510 years Rewards are stronger for nondurables Early not pioneers market leaders have a higher market share success rate and market leadership The mean market share of pioneers is 10 rather than 30 usually reported Stir the Big Questien beeemies WHEN SHOULD THE PiIONEEiR ADUANT tGE it Faee at Market Evel39utien Suarez La aella QKUUSH tr The S ahaped crave ia called a Dit aaie Curve T5g l1 glg n A g ii mn Humher mt ir39ealrs Iti Tnnlua fur friajnr39Tjer hn nlngh lgci Reach MLHnmes 739 AWi iiT quot 77 739 freeman 7 39 g3 IZI39ilu pillage m Eil39 lEi39l M W TU Izri 39n39iil l E w PIWEEI E 339 it EilliFHEi gm ea 7 E r Eda11aquot 3539 3 m 1 I r F mm 1 a rquot quot A 71quot Hurray V 11D E an SD BL39 113 1243 Number at year year 1 gear cavemen 3133 ml lh 39 i Sayrea ertaea Ma name g Em mememunmamlummamnmw WENTHam um alwl m When talking about pace about which a product is diffusing in the market you have to talk about 2 things 1 The diffusion curve 2 Recognize that each product category has its own diffusion curve and as marketers we gure out how each product category diffuses Four possible scenarios that a firstmover would face Market evlution vs Tech nelgy eveliutien Market Evuuluiinn t Market Evelutiimt Slim 7 Fast I Slaw The prablem with the future is V initiatets 39 I l d it Evil t Up 39Ea39eeteh Tape quotSea39mg i Eh 39l Etta 39 reat ta v tare antiwar B G be 1 D i w Et ld Brand pre mtie Pillage 5115 H quotI r39 15 mpm at39are eaa and ahig big rule I Faat The tremble with the future i t aitr here thtat there 5C at them 39 a JD V Tedmalegtr Rettgtt E iatera m E meadE quot5111311 phane itquottrearablea mark at 39 Ir Teehnelegreal Evelutlen EE m mm h l39Y u need a La at a 3939I17 1 I Slew5uata1m11g Teclfmalegy Itiiig f1 9 ET 113 WP 77 5 ET I I Faat Disruptive Teehruziilergr Depending on which market you are in your advantage should change and how you treat each product will change Calm waters Mostly saturated very little new competitors in the market Slow technology change and controlled by 1 or 2 rms Nice place to be as a marketer Market leads Market evolves much faster than the technology Technology leads Market evolves slowly but technology is moving really fast Ex wearable technology Need to have deep pockets because you have no option but to innovate since technology is always changing Rough waters Worst place to be Quickly evolving markets and technology There is no advantage here the product become obsolete even before market saturation The lnnovator39s Dilemma quotBusiness or organizations will reject innovations based on the fact that customers cannot currently use them thus allowing these ideas with great potential to go to wastequot Sustaining Technologies Those that foster improved product performance technologies that involve improving an established product Ex lPhone 6 and lPhone 65 Large companies are good at these Disruptive Technologies Those that foster worse product performance at least in the near term Start much lower but have a higher rate of growth For disruptive technologies to grow out of the low part dilemma they need a snowball certain amount of people Large companies have problems with these How to create incentives so that larger companies will innovate Examples of disruptive technologies Digital photography Mobile telephone Pmdml Pe nrmanee Handhelpcomputers MMORPGKinect What tend to happen over time The if and imptive TEchlml gical Huge Time The ef and Emup ve T eclmelegieel Change 39 is Wiea y what yen will get if yell eel tlhe eemeumer Ceneumete lmve difficulty jetting tl39ler wemt eemetlhi g that deem t exist Ceneumete better at quotm tweekg Product Pe emmance Time The Wed at and Disruptive Tedmelegical 39 Bert eemeltimeef the ceImet39 articulate a need ie why need an iImeve tm39 IImevetm39e elf rea jr really new pred ets think in jumpe te Geneumer Pmduct Pemtmrmance ef the o This is why there is an innovators dilemma 0 There is a learning curve so large companies avoid disruptive technologies 0 Disruptive technologies grow larger than sustaining technologies Can you think of a recent disruptive innovation in technologl that is changing the marketplace Tesla Autonomous transportation 0 Machine learning arti cial intelligence 0 Electric cars 0 Battery storage technology 0 Power generation speed and sporty 3D Printing 0 You can 3D print anything toys guns pens tables limbs etc Foodlab grown burger Strategic Planning Product Strategies Reactive and Proactive Reactive Has to do with risk adverse nature larger companies 0 Deals with the initiating pressures as they occur 0 Often not the rst mover and reacting to an existing rst mover 0 To wait until the competition introduces a product and copy it if it is successful Proactive quotI will be that new player in the marketquot Ex IBM Explicitly allocated resources to identify and seize opportunities and to preempt possible adverse events 0 Preempts competition by being rst on the market with a product competitors nd dif cult to match Reactive Strategies Defensive strategy 0 Protects the pro tability of existing products by countering competitive products Not really interested in new products 0 Ex When they launched Pepsi Crystal Coke launched Coke clear to cannibalize Pepsi and both failed Coke defended its market position by killing the next best guy lmitative strategy 0 Based on quickly copying a new product before its maker is assured of being successful 0 Ex CVS is trying to imitate the Tylenol drug for customers that are price sensitive cleaning out the lower part of the market They don t kill the pioneer but eat up a part of the market Secondbutbetter strategy 0 The rm does not copy the competitive product but identi es ways to improve the product and its positioning 0 Ex The rst spread sheet software called VisiCalc was eaten up by Lotus Microsoft Excel then gained shared from Lotus 0 Larger companies look at smaller companies imitate their concept and makes it better All three strategies are situations where the larger companies are not the pioneer39s but want to counter the existing market and the rst mover Proactive Strategies Opposite of Reactive strategies Does not suffer from the Innovators Dilemma RampD based effort 0 IBM HP and Microsoft devote considerable energies and resources for technological innovations Consumer driven Identifying consumer needs and developing products that provide the bene ts that satisfy those needs 0 PampG General Foods McDonalds Bose Entrepreneurial strategy Take an idea Usually employee driven and make it happen by building venture enthusiasm and generating resources 0 3M the dotcoms of the 90 s 0 Acquisition strategy Effective for growth and nancial success 0 AOLTime Warner o Coke acquired Mad River to enter the new age beverage segment Situations that favor ReactiveProactive strategies Depends on market structure size of market sales forecasts distribution networks Reactive strategies are best in situations that Require concentration on existing products or markets 0 Can achieve little protection for innovation 0 Are in markets too small to recover development costs 0 Are in danger of being overwhelmed by competitive imitation o Are in distribution chains dominated by another innovator Proactive strategies are best in situations that Require rapid sales growth 0 Entail entering new markets 0 Provide high volumes or margins Offer a capability of achieving patent or market protection 0 Supply resources and time necessary to develop new products 0 Etc The NPD Process Online Find Opportunities 0 Understand the consumer 0 Who are they What do they want 0 Then aggregate Understand the market space 0 How many are they Where are they 0 Then Segment Within similarities between differences Ex Ask names and hobbies at the beginning of class 0 Understand the competitive marketplace 0 Who are we up against How do we beat them 0 Then position near to consumersaway from competitors Understand the Consumer We all think we understand the consumer After all WE ARE THE CONSUMER Or are we What do we know about him or her 0 Ask them 0 What do they look like and what do they do for living 0 What do they think feel and really care about 0 What products do they want to buy and how do they buy them 0 Observe them 0 Consumers may not always know what they want 0 Look for solutions not attributes Preferences 0 Should we care about market preferences or customer preferences 0 You do not want to attract the quotaverage customerquot Online 0 This graph you that there are differences amongst customers 0 Need to nd segments and attract those segments 0 Ex Asking everyone in the class what is their favorite TV show Find Opportunities 0 Understand the consumer 0 Who are they What do they want 0 Understand the market 0 How many are they Where are they 0 Heterogeneity drives the market quotDifferences among people either in terms of observable characteristics such as demographics behavior or in terms of unobservable characteristics such as preferences or purchase intentionsquot Understand the competitive marketplace 0 Who are we up against How do we beat them Segmentation Methods Firms can use a combination of several segmentation methods Geographic o Continent region city etc o Esricom Will help to segment brands Psychographic o How do the consumers describe themselves 0 Lifestyle selfvalues selfconcepts Demographic 0 Age gender income etc 0 Most common Geodemographic 0 Birds of a feather ock together 0 Urban sophisticated etc Bene ts 0 Convenience economy etc o Caffeinated v noncaffeinated drinks Ex CocaCola o BehavioralUsage rate Occasion loyalty etc Positioning Developing a speci c marketing mix to in uence potential customers overall perception or a brand product line or organization in general Attribute o Tells us what attributes that the customer tends to score on Price amp quality Use or application Product class 0 Competitor 0 Emotion Product user Perceptual maps Explain WEI Fu39firsu if my HillEh mailing quot 39quot maiw TUEHJIEH lbw E p t Apple competes more with Sony than with Compaq Positioning Differentiation is the creation of tangible and intangible differences of some key dimensions 0 Positioning The set of strategies that rms develop and implement to ensure that key differences occupy a distinct and important position in the minds of consumers Ex Price and quality Want to dictate what position we are on as a brand Questions to ask for positioningstrategy 0 How do our customers view our brand 0 Which brands do customers perceive as our closest competitors 0 Who else do the customers consider Ex If it is breakfast we don t necessarily compare Salsa Limon with just Fuzzy s We also consider McDonalds and Einstein s o What attributes seem to be most responsible for these perceived differences Ex Attributes when considering breakfast are speed to go nutrition and price Where do perceptual maps come in 0 Mapping techniques provide formal methods to depict the competitive structure of markets 0 Essentially helps develop a visual representation of how target customers perceive competitors alternatives 0 Very useful aid to intuitive managerial feel for competitive structure Perceptual mapping 0 Visual representation of customer s perceptions of your brand your competitors and what attributes are important to those customers Per eelntunlllfuipwnlitmr Mandi Eula E mp l HydraEmilquot ff 393 lich 39 E HIE quot If ur iH 3 a with E g a I 5 1quot r 5 E if E l I a quotF q tufl l f I H gt 3 E 39 I I quotir quotFu E In 3quot Iii E quotE 1 F u a m B39 1 h e39 l mix I III I nu E rl EU Et T39nIaliliuall Shows that Diet Pepsi is a competitor with Pepsi max not Pepsi next The many uses of perceptual maps 0 Understanding the market structure of product categories as perceived by customers 0 Selecting the set of competitors to compete against 0 Evaluating new product concepts How do we devel0p perceptual maps The beer example 1 Selleet a set est hre de et Zil ltETEEii tn the a u 2 Identity ethfiihutee it P pl i with 111911 m Tl lp pi f its EH1 Ceftehteted Lew it teete 3t Halve metemere eeellueite the hrende at Avere e eereee euetemete tel eech attribute Fetter it Grew the ethihtttee ii te e E t l l Intuitth ef attributes 1 Flint the Multiattribute perceptual map What is it 0 We don t have just 2 or 3 factors that we like to think distinguish our products But we can t think in higher dimensional space So we try atten ndimensional space into 2 dimensional space without losing all that information restricted 0 Premium Includes price social value service quality pricing quality reliability all owing into one big factor What makes a product premium if there are more than 2 attributes Difficult when you want to represent multi on the two dimensional space Perceptual map of beer market Top heavy Right side Premium 39 om h lwamkee I quotreck39is I Meister Eran Etmh fs I UM ih lmukee Light Budweiser is a closest competitor to Miller and Coors o Budweiser is heavier than Miller and Coors but less premium than Coors 0 Look for clusters Perceptual Map f Beer Market This slidle shows only the attributes Henry Pull Bodied HEW Blue Collait 7 g Good Value 7 r Budget Pale Color 11 a z Budget L Ligllllt W11 P39remim 39 Popular 39 with Women Less Filling 0 Each of the green lines signify how important each attribute is The longest line quotpopular with menquot seems to be one of the most important attributes 0 Each attribute describe one element of premium heaviness budget and lightness Heavy amp premium Premium amp light Budget amp light Heavy amp budget Ex Less lling means it is closest to being more light and more premium Perceptual Mlap Ull Beer Market b th prod ucts 2 attributes HEE F P I Han different is K Hm Mm Budweiser frem Full 7 ll 39 C0013 llll Wmquotka Budweiser quot In 39 quot Henk s I Meistezr Bran r 511mm u Heineken In g 739 v 39 m quot l leCEasimns Blue Cellar V I V I l I v g j divamut I I gt J u n V g l V V llmmg hilt Plemlum Budget 5 th s A v Premium Ia Michel h 39 n Cami5 39 t J gt Pale calm quot 1 Light 391 A Wemen ll a m U a Hilde Light Light Less Frillmng Relative to how far the brands are to the attributes 0 Figure out even more differences 1First thing you look for what am I not close to what does the customer not see me as Ex Budweiser is not Light 2Look for some dimensions where there is some overlap Ex Start with quotpopular with menquot and look at the length of each line and that length tells how important that attribute is to the customer 3To nd out how popular beer is with men you draw a line perpendicular to that attribute 4Then measure the distance ex from Budweiser to quotpopular with men 5The lowest value means that Miller is closest to quotpopular with menquot shortest distance Closeness helps us describe how important that attribute is to that speci c brand 6Next we have to see how the customer see s the brand on the speci c attribute by measuring the origin middle of the graph up to where Budweiser hit quotpopular with menquot 7Ex Budweiser scores best with popular with men and miller does not score very high even though it is more important to them 8To gure out the position of the brand you need the measure of both the lengths the arch is the description of the position of the brand Don t worry about the angles Guidelines for Interpreting Perceptual Maps I The arrew indicates the direc tiert iri that attribute is hrcr39easing I The attribute clecreasing in the directien eppesite te the arrew I In the map en previeus slicle a pesitienetl farther and farther in the Neth East directien are pepular with men whereas a beer pesi ened in the Seuth W est tlirectien is less pepular with men I The length at the line hem the erigirl tel the arrew is indicater ef the variance ef that attribute explained by the 2D map Ir The lenger this line the greater is the ijnpertance at that attribute in helping te interpret the map I Thus Geed value and quotLess filling relativer mere impertant than Pale celer and Blue cellar in explaining haw elf custenrers discriminates the different beers 39 Guidelines for Interpreting Perceptual Maps t1 Attributes that are lath relatively irnprtant and clese te the heriaantal vertical axis help yen in articula rig the meaning ef the axis 1 Here the twe dijnensiens aleng which custemers seam te dis mlj39nate between the appear te be Budget Premimn fer the heriaental and light Heavy ter the vertical axis This interpretatien can he based en attributes meat cerrelated with the axes Special eccasiens Blue cellar Budget etc fer the heriaental axis and Heatqr Light Pale celer fer the vertical t1 Te pesitien a parcular beer an an attribute perpendicular line frem lecatien ef that heer en 1 Use beth the directien and cleseness te the attribute te interpret Wliat cah you do with a Perceptual Map Linpk farm Market Gaps D eurse cm f mm I m v i l 39 Hie Hemmer really wants is paraded in ge p l Perceptual Map mquot Understand mamket structure perhaps 39 farce emrrpe liters me less napfirm pesi rms Perceptual Map madam E a 935E rmIrvr FIE Su Trl jmll Positim iepusii u yum brand dl rmmfmrl39lli Perceptual Map Understand market structure Crystal Pepsi example mming un Perceptual maps are a useful aid to managers to help them visualize competitive structures Both directions and lengths of the axes are important in perceptual maps Combined with preference data perceptual maps can provide crucial help in formulating positioning strategy It does have its limitations though 0 Research should be able to clearly conceptualize the attributes 0 Works well for hard or functional attributes price product features 0 Each person looks at attributes differently heterogeneity in responses 0 The NIPD Prcesg base 1 I Phasa 2 Phasa 3 Phase 4 Ph 5 WWW 3011mm Concept Eh DEVEIETI Railing amp Iid mti m Gen ra m Evaluat nn 32 39 Munch and S l c m Iidlemti m Emma Historical Roadblocks0n Slide The Attrition Rate of NewProduct Projects Safes ing and it Evaluation 3 E Equot Businsss mine 3 Analysis g 5 I 39 Successful Q 39 Frodust 39E i H stslspmsnt In I 3 I Testing a a E 339 Csmmsrslsiizatllon z r 1 l I I ii lti 23 as is s so Percentage of Time RISE AL Page PUMA Peri mtsnce and best prsclices paper alt conference Chicago Nov 13 11991 What is a product Concept 0A concept includes 0 A speci c product form attributes Ex Size color etc o A speci c technology the source of the form 0 A speci c bene t for a particular usage situation 0 Technology permits us to develop a form that provides the bene t 0 Rule You need at least two of the three inputs to have a feasible new product concept and all three to have a new product Some Ptterns in Concept Genertion Customer need develops tecl39molO39 P TOduces Firm develops technoilojqu finds match to need a customer sement produces form envisions form develops technolo39lv to product tests with customer to see what bene ts are delivered 0 Tech companies tend to follow number one and two Analytical stratew to convert opportunities into concepts 1 Perceptual maps Understanding how customers think 2 Relationship analysis 3 Conjoint analysis Relationship analysii Ted talk 0 Force combinations of dimensions features functions and bene ts together 0 Tomato sauce Three big attributes which are important to the customer where there can be any combination 0 Flavor texture and type Ex Garlic creamy marinara Techniques 0 Twodimensional matrix 0 Multidimensional morphological matrix 0 Go through each combination and study new product opportunity 0 You can make any number of combinations of dimensions Reationship Anaiysis exampllie Insurance company i 2 diluengionel matrix tr WWIo should be insured r What should we insure agamst Event Persoim inimal Insured IHEWKFEEII New linger Tropical New Againgt name GEW39UEEE Bate Ein inuhulclem Newlywm In nity from Fire Getting Lost anrml Beth Kidnepipingg Being linemlte 30 different combinations of new products Go through each one to check viability Reationship Analysis exampe r Merphologieal Matrix Coffee maker lb Explieitly fermulate problem Identify parameters attributea lb Liat all eembinatieria r Examine feasibility lei eaeh alternative lb Seleet the best alternative l imeneiarl Reaping 7 Healing Miliinl m aa Filtering Emiliaa Emma Warm Faulting Emilea ill Heating 1L Err apaan ii Filter paper Thermal ll Value unriar element in par ljiriaullatingl 39rrat teahnal rigy pen illamge builtin Parana Warminl unit Pump ll39irll lunrller pat measuring rail aaranriia filter in rat aii part 3 Mlirrrriwara 3 lllil ii39l1 ltl ilantrifnge External heat 3 Eapraaaailike unit feed rriathriri aaiirae late The same two dimensional one expanded multi dimensionally Each dimension has different levels 0 Qualitative method to study the relationship between consumer preferences and product attributes What is conjoint analysis 0 One of the most widelyused quantitative methods in marketing research Built on the concept of tradeoff lt is used to 0 Measure preferences for product features Understand how the customer makes a decision and trades off among attributes 0 Learn how changes to price affect demand for products or services How do the 4 P s affect the consumer 0 To forecast the likely acceptance of a product it brought to market 0 Revealed preferences as opposed to direct surveys 0 Rather than directly ask survey respondents what they prefer in a product or what attributes they nd most important conjoint analysis employs the more realistic context of respondents evaluating potential product pro les llr Entreestemples 1 ll new Iiigelsi a j r this emputer t H39Fs39atu were in the market ta purehase a PE tedla39a Lise elf and these ware year enle altemetiees whiieh anemia vii u eheeae Illd I Enm MEIl Freemanquot 3 EH lPrneessunr ILGB HAM Ill GIE MM 11inch Maritaquot lliillndlt lMeniter 3951 335 5399 t V quotfear Eeere Traditienallyg researchers have written surveys that ask people alseut their preferences brand die you peter 39 interest rate weuld yarn like Haw mil1311 ri slt yell to take High Risk illaw Risk High Patental Law Petenitali Less er Return Lass er Return Heweeer theee Answers are eftem trivial er unmenlighltenming Instead a marketer you want to knew Hem imperfmtt ie if that the meim er gets the I Breed Ir Interesf mire Ir A m Ir credit limit she wants Average Impfa ee Ra ge Ema a 1mm m HillWHEEL stated ii rpe amze ratimga aftem have ew because many Peep1e tend he say that every mrlg re TE wipertant 5 1111 mm an masterCard One way to understatd tradeffs is thrulugh a crampensaterv model temputatien r is a term at t Mil251178 the respeurlent is his her epiuimis directly Ir Ceuld cause same due tu sampling bias eta r Haw ten de Eltpurtauee Brandi Itutal at il Attribute 1 railing lit 9 Attribute 2 ill 9 Attribute 3 ill 9 Uverall at at relf Intp rtarlee turpei39ltariee ttribute ttribute The better way to do conjoint analysis important making evaluations looking at multiple attributes not in isolation oAs in the real world respondents have to make tradeoffs oMOST IMPORTANTLY this method does not direct survey 0 We use revealed preferences Mimics the real world and doesn t allow people to say everything is Underlying Principles l Year preferences are based an tradeetfs between attributes t Credit Fees vs Credit limits 2 Usuallyr yau are net eeusideririg DRE attribute at a lime ta evaluate yaur P lIIDI39IE Instead yeti ate eeusidering all attributes jaiutly39 3 Year everall Preference tar eaeh P iIlD is the sum at the utility yeti derive tram each attribute level er haw much that attribute level is wurth ten vuu 39ll39e rlmirielegy Attributes Attribute Levels Part worth utilities Preduct Utilities analysis Feasible values i utility fer a 39 Preducts are represents preducts attribute cart speci c cut a bundles cit er services as pessess particular attribute attributes male 3 if 39139 chrr eg Cellar i5 33119131 P The at a t ib tEB Red Green Blue WEN th prcnduct is sum it attribute relayr he li ihite 39 It designates hew ef the at any clearlyr defined much that part at its attributes feature er the pmduct werth characteristic tn the 39139 They must be 39 Part werlh utilities urdered are the building 39139 Eg Price Size etc li IUCl B if Emlj il lt 39 Path werths Preduct utility o Attribute Feature that describes th product Ex Color shape etc Needs to be de ned very clearly 0 Attribute levels Each attribute has a discrete attribute level Ex colors can be red white blue etc or price can be 199 299 399 etc o Partworth Describes how important an attribute is to that consumer Ex The part worth utility for price may be very high and for design may be low Give an idea on how important a speci c attribute is 0 Product utilities The sum of all partworth utilities What utility does the customer get from all the combinations Pick the highest utility Ha I de Cenjlilnt Analysis 39 Chaise a Prlduet eategry it Identity relevant attributes l Put the determinant attributes tegether er sets 39 Stim us Representation l Shaw examples tier stimulus fir the respendent te evaluate 39 Respense Measurement l Respendent ranks the 139 Analysis If Data REgIEESi39 1 E Color Price etc 2 Ex Prototype Examples in notebook Understanding how Conjoint AnalySiS works Finding the petfeeti gallquot traill Er Suppose we want to market a new golf haJll we fremexperience and tram 39 three hrlpm39tant precinct features n Average Uniting Distance g Average Ball r Priee with there are We emits know that these is a 1ng sf tease shamanses fat east at these teenage tel instance erases Bst Lite Price 54 tales 135 Etheles 150 13 tales 135 eg 1 Wlmt We t ba W mm d the 2 Nut type at halt weald the tent E DRE In E F mmket p 1 HE E 1 want the tensmner te preter 0 Levels Average driving distance 225275 range 0 Question 1 The product built out of the rst row is probably what the customer really wants Ignoring tradeoffs Question 2 The product built out of the last row is probably what the company really wants Want the customer to keep coming back and pay the highest price Eensiidler Avg Driving llDlilstarlce 8 Avg Ball Life cenjolirltly Let us F f price for new b New consider the same two telaturee taken A and B the ranki ge of the 9 slime preducte the hen buyers price is the same all mmh m ne Figure A K Figure B a BMW I Air ag B 39 Life EH 3 211ng En Lire like 36 late 13 lmlles lmlEE Eli EDIEi I3 hm Airmen 175 Earth I 2 4 Jrer g 235 mine I 3 a r f g Elli yards 3 5 f5 Drilling Hall Farm 2 5 E EmilHT 225 giant39s T I3 399 iijm re 1 35 yards 4 IF I b the 0t 1 9 the same the medeefte are dift ent leek at the remake 2 311 5 lfm hath the buyers r is the pewer and ESSE CE cit cmujei t analysis Highest holes and large is the best 1 and lowest hole and lowest yards is the worst 9 for both buyer 1 amp 2 There is a difference between 28 which tells the difference between the two people and how they tradeoff Ideal product is going to be 28 helping understand tradeoffs Read up on Linear Regression Quantity FPrice supply advertisement etc error something the marketer doesn t know but we need to make an assumption Regression holding all others constant what is the relationship between Price and quantity etc One way that we quantify relationships Main assumptions of regression 1 Independence Independent X s 2 There is an error term we don t know we assume it exists and follows a normal distribution Centers around 0 but we allow leeway 0 Sigma squared The error term observations are independence Ex Error 1 2 3 4 There is no relationship between 1 2 3 or 4 I I D Independence between X s and the error We assume that price has absolutely nothing to do with the error and neither does supply advertising etc Conjoint analysis steps Step 1 Attribute 2 Stimulus O or 1 3 Response 4 Create dummy variables and removed one dummy variable per attribute Knew if something was a 1 the other one would be a 0 5 Look at if the regression is valid Look for R squared 6 Figure out of the model is valid FTest The smaller the test the higher the probability of it being signi cant 7 Interpret the coef cients The intercept the base line When Pvalue is less than 01 it means that it is signi cant If the coef cients for convertible is 5598 that means that is how high that preference is because coupe is 0 Analyze the results 1nterpret 39B 2 Figure out how important these are for the customer 0 Calculate for each attribute the range of each of the beta coef cients MaximumMinimum Sumranges 0 Importance of Attribute 1 Range 1SumRanges This gives the importance of each attribute 3 Try to nd that ideal concept gure out which concept is the perfect product for the customers 0 Need to predict for each level plug in the values multiplied with the regression coef cients 0 The highest level will predict if it will be ideal Ex Preference for pro le 1 Coupe CA emission 180 HP None 25K R Squared if 09 that means that the variables that l have in my data explain 90 of the variance in my preferences the higher the better if closer to one that is good The NlF39D Process Fuzzy IFrnt End Phase 1 Phase 2 emmjty QUEBEth I Idti eetiem Geeerstiemf sud Selee e Idealism Recap Concept evaluation Phase 3 Concept EV l D Se Sereenimg Phase 4 evelepmt quot Phase 5 Testng E sullen K What is a product Concept 0 Technology form need Generating concepts and new product ideas 0 Understand gaps in the market perceptual maps 0 Relationship analysis morphological matrices o Conjoint analysis to an extent More useful for concept evaluation The next stage is to test the viability of your new product ideas test The evaluation of design concepts implies and involves both comparison and decision making You want to compare across concepts and want to know if a speci c concept is feasible 0 Evaluation techniques require a comparison between the concepts developed and the requirements they must meet along with decisions regarding how well they meet those requirements 0 Concept evaluation is a form of analysis but it rarely takes on the highly quantitative aspects 0 Steps 1 Feasibility judgment Is it possible 0 Figure out if we have the need and the knowledge rely externally o Conditional feasibility If something happens then the product is feasible 2 Technologyreadiness assessment Is the technology available and is the customer ready for this new product 3 Decision matric Put all of these concepts together and compare them Feasibility Judgment Eu TechnologyReadiness lassessment 1 Feasibility The first step in ext feasibility is ts eliminate these eerieepts are deemed quotnet ileasible r any 39IUfteri these are based teel etten triggers eenversatiens and Prediret develepment tin elitists 39 Cemiitieimll Fs esiti tits eeenrs i when it is detemunei i i quot 1 d that a eerieept is werltalble it seniething else happens 39Teelime1egieal advances mket resperise eempelitien t this Teclmlegjr Readiness Assessment quotDe reliable and r39easeriable preeesses existquot quotDe appnnpriate eheiees ter the selutien exist and are the readily available quot ees team have teebnelegieal expertise the selu lien eerisi IElites the selutieri make use if mature and deeelleped teebnele es quotDe applieaijeris exist that dejiieristrate the teeimellegjjr s readiness Decision matrix Ex You have 10 different product concepts one method of comparing is conjoint Another way to do it is through compensatory models or calculations Decision is essentially concept evaluation 0 In order to evaluate concept effectiveness some form of criteria are needed against which concepts can be evaluated in a qualitative fashion 0 You can do this in two ways 0 Simple decision matrix compensatory model Each concept is evaluated across a set of attributes Each attribute is given importance in weight typically from 110 1 being the lowest and 10 being the highest Simple compute the overall scores for each concept Then pick the best one o Conjoint Analysis Where dc the tools that we learnt fit in 4TBPIEE 1 2 TDPIICE 3 D weequot1m W g we Seem il l Phase 2 Plilae 1 EDImp1 Phase 3 Phase 4 Phase 5 Upparhmity Ganera nw Ep E ncept lDeveleipmenlJ 3 Feeling amp enti caticn Mama Evaluatian 3 Launch 1 nd Selection Screening l l l l l I ll Where are we Tlhe NP Process u l H r A 1 A 7 Fuzzy Front En Phase 1 P113152 392 quot Phase 3 Phase 5 7 Conth I Concept Testing 3 Generation Evaluation amp Launch and Selection Idea ion Demand forecasting quotThe trouble of our future is that there are so many of themquot dynamics in data not accurate understanding and predication Why nancial Analysis for New Products is dif cult Target users don t know 0 Need to be crafty because target users don t know what this product looks like elicit preference from target users o If they know they might not tell you 0 Even if consumers understand the product they don t want to reveal preferences 0 Poor execution of market research 0 Market dynamics 0 Competitors in uencing the market we don t demand keyboard phone because consumer preferences are constantly changing 0 Need to study how a competitor reacts and know how fast consumer preferences are changing Uncertainties about marketing support 0 Mechanism which these uncertainties affect our market success o Insolated markets from recession are necessity products these are price inelastic Ex If you need to buy medicine you absolutely need to buy it o Biased internal attitudes o Gut feelings Can be problematic if not ready 0 Poor accounting Rushing products to market Basing forecasts on history 0 Technology revolutions Commonly Used Forecasting Techniques Technique Tim1e Hnrizen a Zest CE rlnnile nts lr39tw alreathr I u SI 39 e Winn Short Law l mlleam lllzrmw tlhese 39 mpl 39 E351 l based n previang 39 llhltiple Regimmn Short medium Hudlaate Hum ldl iwl rt Tiame and classes Analy is Shoot medium tun A TAR Made Short Law 535539 quothequot p39Etl and We 1will fDElLJE I gt 5 mega Edaquot H355 Wm Model Lung Medium vulnerable in market slime jnint Analyeis shunt Law EH 393 gamer but re of sampling mam Medium Low Interpret wilih Need to have the data heavily dependent on the data Diffusion of Innovations Maegan in Rural sociology Ryan 8 Gross 1943 Emdly me adaption of hybrid seeds a mm fammiers 259 d45 5162135 l 1432 nese numbers are a ruKimate kp plulairiEed by Everett RGQIEIFS 1952 n mmm nl m New Hybrid Seed adopters n sodioilogy Edlmtinn a medicine EEEE hioilogm marketing an 0 economics mlall network amalgam sta s cs 1 I u I I I I I I 1 2 J 1 5 E 5 1II 11 12 13 14 psydmilogy etc 5 I V Diffusion innovation Describes consumers Adoption Time Early Majority 34 1 Late Majority 34 Earlyquot Adaptors 13 5 39 I Lnnovators 25 v39 v Lagg rds 16 Ex Google Trends Adopter Categories El Innevater ihientuIreeenne Enthueiaste Willling te talke iieke Hiave niaIneiall liguiditrgir price inieilaetie high lhrand legality CIBEEIIF eenneetedi with brand iiidiUStW En ether innipvatpre Peeplie whip stand in line fer the liatjeet iPhipIne Fquot Eair liv Majpr iity Deliberate Pragimatiete iipt a5 nancially liquid Speiali Cpnneoted pr In39iek talking ae the preaipue two categpriea lFiret MAJDIR pprtipn if the manket Therefpre repreeenta huge revenue petenitiiall Latte Miaj ll39it r Sheptiieaili Cnneeruatiivee They adept after the airg partieiipant Wipeth eke ieall ahpuit the iinnp39atipn El Early Adapter Opllnllpn headers V pt J J V J J lliighlhiF eeeial with limits pf fpllpwere peppie El whip listen Laggiair de 39li39r39aiditiin niaili Skeptics lLiittle tp Inp ppiniipn leadership Nl t 3395 WEEK talking 35 Inii39l di t i39 Fetueed en tiadiiiljipne and exhibit inertia tp Very impertant tap dif ueien eilnee thE y39 ChiantiE 39Qi VEIIni the pt dif ueipln earlyr Generaillly plidelr and lees eecialilly tpnnet ted factors affecting the diffusion of tech noiogy the mnemonic jeAdv antge at the prpduct ever that it reipiacee Zecrpnnpiexity pr perceived eempiexity ieCpnnpatihiiity with ipreeent hehuipr patterne ZeOiheereaitJility pf henefite tp EDHSUWEII39E Te Rieik pf depting new techneipgy Ze ivieihiiity er 39i39riaiahilit39jir can it he tried pn ilinnited heie Hew dp theee faetpre affect dif ueien o The higher the relative advantage the faster the diffusion o The higher the complexity the lower the diffusion 0 Positive relationship Compatibility Effort consumer has to put in Ex Not wanting to switch from window s to mac 0 Negative relationship Observability Promotions As a consumer how visible is this product The more observable higher the diffusion 0 Positive relationship Higher the risk lower the diffusion Pricing strategies increase diffusion 0 Negative relationship court 0 Positive relationship Forecasting Techniques Basic Sales Potential Analysis Sales Potelntial Estimation softer used from concept test results a 1 a u iiiE Assumes awareness and availability Translating quot39 Intent39 r into sales potential 2 Develop the norms carefullyr for a speci c market and for speci c launch practices xamples u Services 45 chance that the definiter would buysquot actuallyF will buy 15 for the probably willquots Consumer Packaged Gootls EKG30 chance that the clefinites39 r will buy 33 chance for the probany will s Risk Lessen this risk by providing lenient return policies or rebates Divisibility How easy is this product to try out Samples at the food A Translating Intent into Sales Potential eepply these age tee Cehcept Test resu Its 1 n 90 ef39 the de irnites 5 of sample 045 n 410 ef39 the prebables 36 144 n 10 ef the heights 33 33 a use at the last 2 categories them te determine the quotttage whe weulld actually buy it5144im 33 eThuIs 22 ef sample panelstitan weulld buy eiremernher this in is cendlitierled an awareness amp availability 0 If someone says quotDe nitelyquot that means they will buy 90 o The weights are arbitrary Consumers could change their minds Example Try at heme You can try dieing a sales potential estimatieh frem this gure Trial Pwesntege marthe 5t l Nenudurr eh e premium a 1 humble precincts 9 s r nahmsi39reie 9 aquot 39 n l I t Def Net Prep Net Might Fret Diet lMsntien te Ether Figure Eli Frullahillty FE alrlj Hated L39iill 39C Lustmuer ltespnmrjse m Intent Slush ij tileptstl from Jamiesma and Bess LEI313 B From Potential to Forecast swith Sales Potential Estimates A To remove the conditions of awareness and availability multiply hv the appropriate percentages If sons of the sample will be aware via advertising eta and the product will be available in sons of the outlets then 22 K E X 30 11 11 of the sample is likelv to ouv 0 Measure awareness The ATAR Model 0 Availability trial awareness and repeat Sales Forecasts swith Sales Potential Estimates ssrsR Mdlels est used with incremental innovations asedl on diffusion theorv a altarHuiarenassIr Tn39al Availability is different that tlhe intent translatiinh desorilhedl abnve bio it does canto re the repeatquot component 0 Basically same arithmetic but includes repeat 39ili39 iR TEL a slit TIE quotJPquot Mt l i Punting Units grit1 c Pruitt per lITI39IIlI r Units said Number 3 buying units tac Pemcttl gi whit lie215151 avg 5173 t the tm ut 2 Percentage whee njjit Li try the isn tnduct iiithey can get it 3 Pat39cet ttttga elf intended triers whim can get the precinct it is available ta them K PEIEEHIJHEE atquot triers will like the items Bil llgh l repeat lmiiiquot purchase is Nt mhcr If limits tlttit rawstairs will buy in a 1mm Prizl i pm unit Revenue Em unit unit liter price 1255 Insult TILal39HilIJJi Exrutzlttttitjltal rlllnLJ a n39iE39l39LLit itseight tth Emits Jan innit usually cast Uflg udl mid pitt direct nnu ttetittg E t limitrct39tfixrri Prattit s Etijn39iitg units iJit Parcel awaim 3 Percent trial 22 Percent ttt39ttilaltuilltl 29 Percent repeat 3 itmtail units bought Revenue per unit CHEW pct unitii 0 Market size of customers how many are there 0 Awareness 0 Trial 0 Available 0 Repeat o If repeat how many All you need to calculate the ATAR model Example eF TAlR in actien FEK MFLE 251 new mere eanvemient Club fer spurts ear awners It39s lhullt en line principle Inf rrneI adherence FPF t in market If I aware I as when available Emuha repeal unil rapecairn Izmir REhr per unit un t sums a If spans ear 3 milllinm a all we minlk we can make aware with ads 4 a is at eastern ante partsfnmss mereh we can tnnnrinee ta stack 443 a is at iers whe will buy me far 2nd earz il l a average units mught1n5 a Inlet res 115 l F39Whlat is line Pra t te he gainletll threlugh the new nmdlrltjt What is ldl e expected rnarket share Pro t 900000 Bass Diffusion Model A little history 3939rees pedple lties and aWImt is cemmnn to federal debts grew agriculture tECll lll39lDngy lieat ilnfdrrnatidn quot em n mi gr and diseases are transferred dr quot b l 39 g n transmitted quot physi r demegranhyr teehnelngv transfer immunelngy eeelegy innnvatiens insect eelenies grdnndwater mntaminsnts and elider n l iss are diffrllsed er dispersed er spread The diffusion curve is everywhere Area an idle leavee ef a ellalnt Internet Usage in Equar39 39 El l39ll 5 g E 1 El 4E Ell mill 1l2 141 131335 ll39d39llllla me all unit a 15934 15955 1 3 15991 1 19939 1l 1 K Fears The Bass Diffusion Model Develeped by Frank Baas ta fereeaet diffuaien and demand fer new innevaljene and preduete Predict market aize and aaturatien paint Cline ef the greatest eentrihutiene te emnemiee hueineea and etatiatiee lle waa ahert listed fer me Mabel mile 1 a e Ie i 391 I Faa If I 3e IELEPIIDME E aquot I L39 e i39 ier1quotquot 39e f I quot 39 p y El M Lut quotquot391 W39 0 Only commonality is the shape of the chart Application to population in California Raw data m Application of bass model 19 millions million a a a a E 2 8 2 o to a o mil rx are a r5 Capacity 1 49 million Modeling framework 0Potentia adopters classi ed into 2 groups 0 Innovators o Imitators o Tend to in uence one another quot Key assumptions 0 Innovators are not in uenced by others in the timing of their initial product 0 Imitators are in uenced by the number of previous buyers in the timing of their initial product purchase Everyone is buying an IPhone and I don t want to be left out Impications oThe importance of innovators to product sales will be high at rst but diminish with time Imitators create the snowball and mass of customers 0 Imitators are in uenced by the innovators Can be used te understand relatienships between diffusion of new products DESKT39O P PCS INTERNATIONAL DIFFUSION Ceurltries fear frem me anemer 39quot39 e See reading Sunder Kumar and 12 Ramaeeshan 2011 u g E u Ea 5 E 2 a I1E233 BI I H1 Bi an E1 92 TH 0 As a new upgrade is launched the previous upgrade falls Sales Growth Made for Dummies The Bass DIffusIcm Mude SE p IREImaInIInIgI q x Adaptera Patentiall REImaInIng PntentIal I I I I Iinnnvatinn ImitatInI I Effect Effect 9 al mlu 39 II Il quot 3 quot1 All1
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