Consumer Influence and Diffusion of Innovation

8/3/2019 Consumer Influence and Diffusion of Innovation

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Consumer Behavior

Hussain A. Al Awami, B.Sc. Pharm., M.Sc., MBA


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Consumer Influence and theDiffusion of Innovations


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introduction

Informal influenceon consumer behavior

Dynamic processes thataffect consumer acceptance

of new products


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Opinion Leadership

Opinion leader informally affects opinion

seekers


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Examples

Family gas barbeque

Film photograph

New TV series


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Statistics

4 times likely to be asked about political

3 times likely to be asked aboutcomputers

2 times likely to be asked about health


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WOM effectiveness

71%

friends recommendation

63% past experience:

15% advertising


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Dynamics of opinion leadership process

Credibility Positive & negative product information Information and advice Opinion leadership is category specific Opinion leadership is a two-way street


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Credibility

Objective

no incentive

of using theproduct

200-1,000 sales communication a day

Thousands of times to respond to friendrecommendation


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Positive & negative product information

Marketers favor their product/brand

Opinion leader provide both Favorable Unfavorable


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Information and Advice

Talk about their experience

Advice to buy or to avoid


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Opinion leadership is category specific

Specialize in certain products

Becomes opinion seeker for otherproducts


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Opinion leadership is a 2 way street

Opinion leader becomes opinion receiverfor the same product

They might change their opinion afterconversation


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The motivation behindOpinion Leadership


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The needs of opinion leaders

To satisfy some basic needs

May be unaware of their underlyingmotive

Benefits to opinion leaders


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The needs of opinion receivers

New product information

Reduce their perceived risk

Reduce search time

Opinion leader approval


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Profile of opinion leader, general

Innovativeness

Willingness to talk Self confidence Gregariousness Cognitive differentiation


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Profile of opinion leader, category specific

Interest

Knowledge Special interest media exposure Same age Same social status Social exposure outside group


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Diffusion of innovations


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Diffusion AND adoption process

M a c r o

pr o

c e s s

Mi c r o

pr o

c e s s


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The Diffusion Process

Innovation

Channels of communication

Social system

Time


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Innovation

No universally accepted definition

Innovation Firm Product Market Consumer oriented definition


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Product characteristics that influence diffusion

Not all products diffuse in the samemanner

Marketers need to anticipate consumersreactions to their products


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5 Characteristics

Relative advantage

Compatibility Complexity Trialability Observability


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Innovation overload

Too much information or options

Complexity of products waste time anreduce chance of acceptance of newproducts


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Channels of communication

Communication between marketers andconsumers

Communication among consumers


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The social system

Social setting

Market segment and target market

Physical, social, or cultural environment


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Social system acceptance of innovation

Modern orientation have highacceptance of new products.

Traditional orientation have lowacceptance of new products


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Typology of modern social system

Positive attitude toward change

Advanced technology General respect for education andscience

Emphasis on rational Interaction with outsiders

Members can see themselves in newroles


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Time

Amount of purchase time

Identification of adaptor categories

Rate of adoption


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The adoption process


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Stages in the adoption process

Awareness

Interest Evaluation Trial Adoption (or rejection)


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Documents

Consumer Influence and Diffusion of Innovation