Welcome to strategy+business. Here’s what’s new.
strategy+business: Corporate Strategies and News Articles on Global Business, Management, Competition and Marketing

Putting the Naysayers in the Spotlight

Matt Palmquist

Matt Palmquist is a freelance business journalist based in Oakland, Calif.

 

Bottom Line: Early adopters get most of the attention from analysts and marketers, but focusing on consumers who are resistant to innovations is another way to bring new products to market.

In an era when high-tech innovation propels advances in a variety of industries, early adopters — trendsetting consumers who tend to embrace new products as soon as they become available — have been closely studied. If the R&D and marketing departments can combine their efforts to attract this vital subset of consumers, the thinking goes, new products can gain a foothold that will increase their odds of becoming mainstream.

Far less attention has been paid to the flip side of this equation — the behavioral attitudes and perceived barriers that lead consumers to reject new products. Although it’s always nice to look on the bright side, it’s a mistake to ignore the factors that cause consumers to reject an innovation as too costly, risky, or unfamiliar.

After all, studies have shown that 40 to 90 percent of innovations, across a variety of product categories, never become commercially successful. History is littered with examples of prominent flops, from the alternative keyboard to the Betamax device. Even some now-popular products, such as the dishwasher and the ATM, took years to catch on because of the lag between early adopters and mainstream consumers.

Of course, high failure rates are part of the nature of innovation, which inherently asks consumers to grapple with deviations in design, price, and performance. Sometimes consumers find themselves stymied by a dearth of necessary auxiliary services beyond the innovation itself. Think of how the proliferation of electric cars has been hindered by the lack of charging stations, and couple that with drivers’ anxiety over the range of the vehicles: It’s easy to see why so many consumers would be reluctant to dive into the technology.

Indeed, a new study from researchers in Ireland and the U.S. shows that both functional and psychological barriers are responsible for consumers’ resistance to new products. Functional obstacles include consumers’ doubts about getting enough value for their money, and their concerns about disruptions to their established routines or way of life. Psychological hurdles include changes to the cultural norm and worries over how using the new product could affect one’s image and social standing.

To explore these barriers, the authors conducted two experiments. In the first, they partnered with a market research firm to survey more than 250 homeowners, representing a cross-section of the population, about buying micro wind turbines, which generate electricity.

In the second experiment, the authors surveyed almost 400 people about another innovation characterized as “high-involvement” (that is, one that involves a high cost and requires a considerable cognitive effort on the part of the consumer): car sharing. Consumers who register for a car-sharing service can use the Internet or an app to get short-term access to vehicles, paying for the amount of time they have the car and the distance they travel.

The authors chose these two types of innovations for several reasons. Decisions involving both car sharing and micro wind turbines are high-involvement; since the stakes are high, people are more likely to carefully weigh the pros and cons of jumping on board with the innovation.

Further, both innovations have received a relatively tepid response from mainstream consumers since their introduction to the marketplace, a sign that most people are hesitant to embrace alternative energy options or diverge from their established transportation routines. About 8 percent of respondents said they were likely to invest in micro wind turbines, and 42 percent reported they would adopt car sharing in the near future.

The numbers also reveal a deeper truth: Consumers don’t shun new products in a homogeneous manner, but apply different evaluation processes in specific contexts to determine their attitudes toward a particular innovation. And pros and cons don’t always carry the same weight. The reasons people give for embracing car sharing are much more likely to actually make them register for the service, whereas their interest in micro wind turbines didn’t translate nearly as directly into actual purchasing intentions.

More crucially, the findings show that anti-adoption factors aren’t merely the opposite of those for early adoption. Instead, concerns over innovations are distinct, and consumers often place a disproportionate emphasis on these negative factors that significantly outweighs their consideration of potential benefits.

Anti-adoption factors aren’t merely the opposite of those for early adoption.

This means that marketing managers should break away from their traditional focus on stressing only the positive elements of an innovation. “Focusing solely on the benefits might be a myopic viewpoint,” the authors write, “particularly when innovations require customers to accept changes in product characteristics, or force them to change habits and routines.”

Take, for example, the screw cap for wine bottles. Between the late 1970s and early 1980s, Australian and New Zealand wineries produced about 20 million bottles sealed with screw tops, but practically abandoned the innovation a few years later. Although the caps worked just fine, consumers resisted them because of their association with cheap, low-quality wine. But when several high-end wineries banded together to jointly market the screw tops and directly assuage consumers’ image and quality concerns, the innovation took off — and bottles with screw tops have become the mainstream option in Australia and New Zealand.

Managers should explicitly acknowledge the reasons consumers or clients may give for rejecting a particular innovation and make context-specific counterarguments to bolster their marketing efforts. And given the recent rise of social media and digital networking, managers have plenty of new tools with which to engage with consumers, gather detailed information about their attitudes and intentions, and anticipate the concerns of their target audience.

Source:Consumer Resistance to Innovation — A Behavioral Reasoning Perspective,” by Marius C. Claudy (University College Dublin), Rosanna Garcia (North Carolina State University), and Aidan O’Driscoll (Dublin Institute of Technology), Journal of the Academy of Marketing Science, July 2015, vol. 43, no. 4

Comments

 
Putting the Naysayers in the Spotlight