NEW PRODUCT

ADOPTION
AND DIFFUSION PROCESS AND DIFFUSION PROCESS
Adoption Adoption Adoption Adoption
Theory Theoryyy
Innovation
Innovation is the creation of better or more
effective products, processes, services,
technologies, or ideas that are readily available g , y
to markets, governments, and society.
Innovation differs from invention .
PROCESSES OF INNOVATIONS
DIFFUSION PROCESSES
MACRO PROCESS
ADOPTION PROCESS
MACRO PROCESS
ADOPTION PROCESS
MICRO PROCESS
A New Product/ Innovation
When the product is new to the
it i it t b Fi O i t d company it perceives it to be new
in the market as well.
Firm Oriented
F h d d Focuses on the product and its
features.
Product oriented
Judges newness of a product on
basis of exposure the consumers
have on the new product
Market oriented
Consumer oriented
A new product is one when the consumer
judges it to be new j g
New Product Adoption Theory
ADOPTION PROCESS
New Product Adoption Theory
Includes the consumer decision stages
th t l d t pt n / j ti n f that lead to acceptance/rejection of a
product or service.
It is a micro process process that focuses It is a micro process process that focuses
on internal forces of the consumer
* Intra Personal (Psych) Influences Intra Personal (Psych) Influences
* Inter Personal (Social) Influences
* Product Selection Criteria Product Selection Criteria
The Adoption Decision Process
Awareness Interest Evaluation
Trial Adoption/Rejection
ADOPTON PROCESS
Adoption
Trial
Legitimating
A i d Attitude
Comprehension Comprehension
Awareness
(1) Awareness: Prospects come to know (1) Awareness: Prospects come to know
about a product but lack sufficient
information about it information about it.
(2) I t t th t t t (2) Interest: they try to get more
information.
(3) Evaluation: they consider whether ( ) y
the product is beneficial
(4) Trial: they make the first purchase
to determine its worth or usefulness;
(5) Adoption/Rejection: they decide to
adopt it, or look for something else adopt it, or look for something else
Influences on the Rate of Adoption
Relative advantage
Influences on the Rate of Adoption
Relative advantage
How much better than existing alternatives? Eg:- Pager
and Mobile phones
Compatibility
Fit current values and experiences?
Gilette Mach 3 vs hair removing cream g
Complexity
Ease of understanding?
Frozen foods
Divisibility Divisibility
Can it be tried on a limited basis?
Shampoos, Household items Shampoos, Household items
Communicability
Can the innovation be observed and
d? communicated?
Eg:- Fashion items
New Product Diffusion Theory
DIFFUSION PROCESS
New Product Diffusion Theory
DIFFUSION PROCESS
Is the spread of an innovation from its source to Is the spread of an innovation from its source to
the ultimate consumer.
It is a macro process that focuses on external It is a macro process that focuses on external
forces of the consumer (change agents,
channels of information types of information) channels of information, types of information).
occurs in a social system (a target.audience,
community etc community, etc.
The diffusion of innovation refers to the The diffusion of innovation refers to the
tendency of new products, practices, or
ideas to spread among people Usually ideas to spread among people. Usually,
when new products or ideas come about,
they are only adopted by a small group of they are only adopted by a small group of
people initially; later, many innovations
spread to other people spread to other people.
Basic elements of diffusion process p
The innovation
The channels of
communication communication
The socal system
time
The socal system
CHANNEL OF COMMUNICATION
WAYS OF COMMUNICATION
1. BETWEEN THE MARKET & CONSUMERS
2 AMONG CONSUMERS 2. AMONG CONSUMERS
3. IMPERSONAL SOURCES SUCH AS
ADVERTISING AND EDITORIAL MATTERS
4. INTERPERSONAL SOURCES SUCH AS SALES
PEOPLE AND INFORMAL OPINION LEADERS
5. INTERACTIVE MARKETING MESSAGES (NEW
CONCEPT)