Innovation diffusion of successive generations of high technology products

Abstract

As most of the high-technology companies are trying to be more demand driven, technological innovation and diffusion have become important force in markets today. It critically affects the fortunes of consumers, firms, and nations. Despite research across many disciplines, many important areas still remain to be explored fully. Consumer adoption decision for multi-generation innovation is one such important research area in this field. High technology product comes in generations where a new innovation offers a significant improvement in performance or benefits over the previous generation. And, often two successive generations under the same product category compete in the market. Yet technology substitution has received little attention in the diffusion of innovation literature. Research for consumer durables has been dominated by studies of first purchase adoption which do not explicitly consider the presence of an existing technology. Only a handful of papers explicitly deal with the diffusion of technology substitution. In this work, we propose multigenerational diffusion model to study the marketing dynamics of Indian Television Market (both Black & White and Color Television). The model consider repeat-adoption-substitution diffusion framework.Comparisons with different existing multigenerational models are made. The results of this study could be advanced for forecasting new technologies of television product.

Optimal Introduction Timing Policy for a Successive Generational Product

“…Determining the optimal introduction timing of new products is a difficult task that becomes even more complex when the firm plans to introduce a product line consisting of a number of different product generations that will potentially compete with each other (Wilson & Norton, 1989, Moorthy & Png, 1992Mahajan & Muller, 1996;Tyagia & Raju, 2006;Libai, Muller, & Peres, 2009). Often, the sale of a new generation comes from three major sources (Chanda & Bardhan, 2008;Kapur, Chanda, Tandon, & Anand, 2010): a. Switchers from the parent product to the new generation (i.e., cannibalization) b. From the repeat users and c. New customers to the product generation, attracted to the specific characteristics of the line extension.…”

“…For example, publishing companies conventionally release hardcover version of a book first at a higher price and follow it up with the lower-quality, lower-priced paperback version afterward. As the continuous innovation becomes the survival mantra for companies, many manufacturers introduce new innovations often by adding new variants into the basic product (Kapur, Chanda, Tandon, & Anand, 2010;Singh, Kapur, & Anand, 2011). Generally, in the initial phase of a product lifecycle the rates of extensions made are typically slow but they tend to widen over time.…”

Optimal Introduction Timing Policy for a Successive Generational Product

“…For example, publishing companies conventionally release hardcover version of a book first at a higher price and follow it up with the lower-quality, lower-priced paperback version afterward. As the continuous innovation becomes the survival mantra for companies, many manufacturers introduce new innovations often by adding new variants into the basic product (Kapur, Chanda, Tandon, & Anand, 2010;Singh, kapur, & Anand, 2011). Generally, in the initial phase of a product lifecycle the rates of extensions made are typically slow but they tend to widen over time.…”

“…Determining the optimal introduction timing of new products is a difficult task that becomes even more complex when the firm plans to introduce a product line consisting of a number of different product generations that will potentially compete with each other (Wilson & Norton, 1989;Moorthy & Png, 1992;Mahajan & Muller, 1996;Tyagia & Raju, 2006;Libai, Muller, & Peres, 2009). Often, the sale of a new generation comes from three major sources (Chanda & Bardhan, 2008;Kapur, Chanda, Tandon, & Anand, 2010):…”