The Buyer Decision Process for New Products

We have looked at the stages buyers go through in trying to satisfy a need. Buyers may pass quickly or slowly through these stages, and some of the stages may even be reversed. Much depends on the nature of the buyer, the product, and the buying situation.

We now look at how buyers approach the purchase of new products. A new product is a good, service, or idea that is perceived by some potential customers as new. It may have been around for a while, but our interest is in how consumers learn about products for the first time and make decisions on whether to adopt them. We define the adoption process as "the mental process through which an individual passes from first learning about an innovation to final adoption," and adoption as the decision by an individual to become a regular user of the product.³¹

Consumers go through five stages in the process of adopting a new product:

•	Awareness: The consumer becomes aware of the new product, but lacks information about it.

•	Interest: The consumer seeks information about the new product.

•	Evaluation: The consumer considers whether trying the new product makes sense.

•	Trial: The consumer tries the new product on a small scale to improve his or her estimate of its value.

•	Adoption: The consumer decides to make full and regular use of the new product.

This model suggests that the new-product marketer should think about how to help consumers move through these stages. A manufacturer of large-screen televisions may discover that many consumers in the interest stage do not move to the trial stage, because of uncertainty and the large investment. If these same consumers were willing to use a large-screen television on a trial basis for a small fee, the manufacturer should consider offering a trial-use plan with an option to buy.

People differ greatly in their readiness to try new products. In each product area, there are "consumption pioneers" and early adopters. Other individuals adopt new products much later. People can be classified into the adopter categories shown in Figure 6.7. After a slow start, an increasing number of people adopt the new product. The number of adopters reaches a peak and then drops off as fewer nonadopters remain. Innovators are defined as the first 2.5 percent of the buyers to adopt a new idea (those beyond two standard deviations from mean adoption time); the early adopters are the next 13.5 percent (between one and two standard deviations); and so forth.

The five adopter groups have differing values. Innovators are venturesome—they try new ideas at some risk. Early adopters are guided by respect—they are opinion leaders in their communities and adopt new ideas early but carefully. The early majority are deliberate—although they rarely are leaders, they adopt new ideas before the average person. The late majority are skeptical—they adopt an innovation only after a majority of people have tried it. Finally, laggards are tradition bound—they are suspicious of changes and adopt the innovation only when it has become something of a tradition itself.

This adopter classification suggests that an innovating firm should research the characteristics of innovators and early adopters and should direct marketing efforts toward them. In general, innovators tend to be relatively younger, better educated, and higher in income than later adopters and nonadopters. They are more receptive to unfamiliar things, rely more on their own values and judgment, and are more willing to take risks. They are less brand loyal and more likely to take advantage of special promotions such as discounts, coupons, and samples.

The characteristics of the new product affect its rate of adoption. Some products catch on almost overnight (Beanie Babies), whereas others take a long time to gain acceptance (high-density television, or HDTV). Five characteristics are especially important in influencing an innovation's rate of adoption. For example, consider the characteristics of HDTV in relation to the rate of adoption:

ACTIVE FIGURE 6.6	Adopter categories based on relative time of adoption
Source: Everett M. Rogers, Diffusion of Innovations, 4th ed. (New York: Free Press, 1995). Copyright © 1995 by Everett M. Rogers. Copyright © 1962, 1971, 1983 by The Free Press. Reprinted with the permission of The Free Press, a Division of Simon & Schuster.

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Compatibility: the degree to which the innovation fits the values and experiences of potential consumers. HDTV, for example, is highly compatible with the lifestyles found in upper-middle-class homes. However, it is not very compatible with the programming and broadcasting systems currently available to consumers.

•	Complexity: the degree to which the innovation is difficult to understand or use. HDTVs are not very complex and, therefore, once programming is available and prices come down, will take less time to penetrate U.S. homes than more complex innovations.

•	Divisibility: the degree to which the innovation may be tried on a limited basis. HDTVs are still very expensive. To the extent that people can lease them with an option to buy, their rate of adoption will increase.

•	Communicability: the degree to which the results of using the innovation can be observed or described to others. Because HDTV lends itself to demonstration and description, its use will spread faster among consumers.

Other characteristics influence the rate of adoption, such as initial and ongoing costs, risk and uncertainty, and social approval. The new-product marketer has to research all these factors when developing the new product and its marketing program.

New-product adoption rate: Some products catch on almost overnight. Others, such as HDTV, take a long time to gain acceptance.

Understanding consumer behavior is difficult enough for companies marketing within the borders of a single country. For companies operating in many countries, however, understanding and serving the needs of consumers can be daunting. Although consumers in different countries may have some things in common, their values, attitudes, and behaviors often vary greatly. International marketers must understand such differences and adjust their products and marketing programs accordingly.

Sometimes the differences are obvious. For example, in the United States, where most people eat cereal regularly for breakfast, Kellogg focuses its marketing on persuading consumers to select a Kellogg brand rather than a competitor's brand. In France, however, where most people prefer croissants and coffee or no breakfast at all, Kellogg advertising simply attempts to convince people that they should eat cereal for breakfast. Its packaging includes step-by-step instructions on how to prepare cereal. In India, where many consumers eat heavy, fried breakfasts and many consumers skip the meal altogether, Kellogg's advertising attempts to convince buyers to switch to a lighter, more nutritious breakfast diet.

Often, differences across international markets are more subtle. They may result from physical differences in consumers and their environments. For example, Remington makes smaller electric shavers to fit the smaller hands of Japanese consumers and battery-powered shavers for the British market, where few bathrooms have electrical outlets. Other differences result from varying customs. In Japan, for example, where humility and deference are considered great virtues, pushy, hard-hitting sales approaches are considered offensive. Failing to understand such differences in customs and behaviors from one country to another can spell disaster for a marketer's international products and programs.

Marketers must decide on the degree to which they will adapt their products and marketing programs to meet the unique cultures and needs of consumers in various markets. On the one hand, they want to standardize their offerings in order to simplify operations and take advantage of cost economies. On the other hand, adapting marketing efforts within each country results in products and programs that better satisfy the needs of local consumers. The question of whether to adapt or standardize the marketing mix across international markets has created a lively debate in recent years.