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New Product Diffusion with Influentials and Imitators

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  • Christophe Van den Bulte

    ()
    (The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania 19104)

  • Yogesh V. Joshi

    ()
    (The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania 19104)

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    Abstract

    We model the diffusion of innovations in markets with two segments: who are more in touch with new developments and who affect another segment of whose own adoptions do not affect the influentials. This two-segment structure with asymmetric influence is consistent with several theories in sociology and diffusion research, as well as many “viral” or “network” marketing strategies. We have four main results. (1) Diffusion in a mixture of influentials and imitators can exhibit a dip or “chasm” between the early and later parts of the diffusion curve. (2) The proportion of adoptions stemming from influentials need not decrease monotonically, but may first decrease and then increase. (3) Erroneously specifying a mixed-influence model to a mixture process where influentials act independently from each other can generate systematic changes in the parameter values reported in earlier research. (4) Empirical analysis of 33 different data series indicates that the two-segment model fits better than the standard mixed-influence, the Gamma/Shifted Gompertz, and the Weibull-Gamma models, especially in cases where a two-segment structure is likely to exist. Also, the two-segment model fits about as well as the Karmeshu-Goswami mixed-influence model, in which the coefficients of innovation and imitation vary across potential adopters in a continuous fashion.

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    Bibliographic Info

    Article provided by INFORMS in its journal Marketing Science.

    Volume (Year): 26 (2007)
    Issue (Month): 3 (05-06)
    Pages: 400-421

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    Handle: RePEc:inm:ormksc:v:26:y:2007:i:3:p:400-421

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    Related research

    Keywords: asymmetric influence; diffusion of innovations; innovation; market segments; social contagion; social structure;

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    Cited by:
    1. Jeehong Kim & Wonchang Hur, 2013. "Diffusion of competing innovations in influence networks," Journal of Economic Interaction and Coordination, Springer, vol. 8(1), pages 109-124, April.
    2. Gentina, Elodie & Butori, Raphaëlle & Heath, Timothy B., 2014. "Unique but integrated: The role of individuation and assimilation processes in teen opinion leadership," Journal of Business Research, Elsevier, vol. 67(2), pages 83-91.
    3. Amini, Mehdi & Wakolbinger, Tina & Racer, Michael & Nejad, Mohammad G., 2012. "Alternative supply chain production–sales policies for new product diffusion: An agent-based modeling and simulation approach," European Journal of Operational Research, Elsevier, vol. 216(2), pages 301-311.
    4. Chung, Jaihak, 2011. "Investigating the roles of online buzz for new product diffusion and its cross-country dynamics," Journal of Business Research, Elsevier, vol. 64(11), pages 1183-1189.
    5. Colapinto, Cinzia & Sartori, Elena & Tolotti, Marco, 2014. "Awareness, persuasion, and adoption: Enriching the Bass model," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 395(C), pages 1-10.
    6. Beck, Jonathan, 2009. "Diderot's rule," MPRA Paper 17404, University Library of Munich, Germany.
    7. Luís Cabral, 2012. "Lock in and switch: Asymmetric information and new product diffusion," Quantitative Marketing and Economics, Springer, vol. 10(3), pages 375-392, September.
    8. Yair Orbach & Gila Fruchter, 2014. "Predicting product life cycle patterns," Marketing Letters, Springer, vol. 25(1), pages 37-52, March.
    9. Florian Probst & Laura Grosswiele & Regina Pfleger, 2013. "Who will lead and who will follow: Identifying Influential Users in Online Social Networks," Business & Information Systems Engineering, Springer, vol. 5(3), pages 179-193, June.
    10. Peter Zubcsek & Miklos Sarvary, 2011. "Advertising to a social network," Quantitative Marketing and Economics, Springer, vol. 9(1), pages 71-107, March.
    11. Christian Fieseler & Matthes Fleck, 2013. "The Pursuit of Empowerment through Social Media: Structural Social Capital Dynamics in CSR-Blogging," Journal of Business Ethics, Springer, vol. 118(4), pages 759-775, December.

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