Consumer Influence and Diffusion of Innovation

8/3/2019 Consumer Influence and Diffusion of Innovation

1/35

Consumer Behavior

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


2/35

Consumer Influence and theDiffusion of Innovations


3/35

introduction

Informal influenceon consumer behavior

Dynamic processes thataffect consumer acceptance

of new products


4/35

Opinion Leadership

Opinion leader informally affects opinion

seekers


5/35

Examples

Family gas barbeque

Film photograph

New TV series


6/35

Statistics

4 times likely to be asked about political

3 times likely to be asked aboutcomputers

2 times likely to be asked about health


7/35

WOM effectiveness

71%

friends recommendation

63% past experience:

15% advertising


8/35

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


9/35

Credibility

Objective

no incentive

of using theproduct

200-1,000 sales communication a day

Thousands of times to respond to friendrecommendation


10/35

Positive & negative product information

Marketers favor their product/brand

Opinion leader provide both Favorable Unfavorable


11/35

Information and Advice

Talk about their experience

Advice to buy or to avoid


12/35

Opinion leadership is category specific

Specialize in certain products

Becomes opinion seeker for otherproducts


13/35

Opinion leadership is a 2 way street

Opinion leader becomes opinion receiverfor the same product

They might change their opinion afterconversation


14/35

The motivation behindOpinion Leadership


15/35

The needs of opinion leaders

To satisfy some basic needs

May be unaware of their underlyingmotive

Benefits to opinion leaders


16/35

The needs of opinion receivers

New product information

Reduce their perceived risk

Reduce search time

Opinion leader approval


17/35

Profile of opinion leader, general

Innovativeness

Willingness to talk Self confidence Gregariousness Cognitive differentiation


18/35

Profile of opinion leader, category specific

Interest

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


19/35

Diffusion of innovations


20/35

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


21/35


22/35


23/35

The Diffusion Process

Innovation

Channels of communication

Social system

Time


24/35

Innovation

No universally accepted definition

Innovation Firm Product Market Consumer oriented definition


25/35

Product characteristics that influence diffusion

Not all products diffuse in the samemanner

Marketers need to anticipate consumersreactions to their products


26/35

5 Characteristics

Relative advantage

Compatibility Complexity Trialability Observability


27/35

Innovation overload

Too much information or options

Complexity of products waste time anreduce chance of acceptance of newproducts


28/35

Channels of communication

Communication between marketers andconsumers

Communication among consumers


29/35

The social system

Social setting

Market segment and target market

Physical, social, or cultural environment


30/35

Social system acceptance of innovation

Modern orientation have highacceptance of new products.

Traditional orientation have lowacceptance of new products


31/35

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


32/35

Time

Amount of purchase time

Identification of adaptor categories

Rate of adoption


33/35

The adoption process


34/35

Stages in the adoption process

Awareness

Interest Evaluation Trial Adoption (or rejection)


35/35

Consumer Influence and Diffusion of Innovation

Documents