Customer Adoption & Diffusion

Question 1

Define ‘Involvement’:

Answer 1

Rothschild, 2001
- There is no commonly accepted definition but the main thoughts are that it contains 3-5 components
& a state of motivation, arousal or interest

Question 2

What is PII?

Answer 2

Zaichkowsky, 1985
Personal Involvement Inventory
- Suggested high & low involvement products

Question 3

Discuss the 2 levels of involvement suggested by Rothschild, 1984

Answer 3

Rothschild, 1984

• High involvement products: use more processing & are generally a lengthier process (external searching)
  e. g. car, house
• Low involvement products: use memory, thought and knowledge
  e. g. sandwich, drink

Question 4

Give the 3 stages of involvement proposed by Bloch & Richins, 1983

Answer 4

Bloch & Richins, 1983

1. Personal: About what pushes you towards a product
2. Physical: About what pushes the product towards you, differentiation (?)
3. Situational: What something that temporarily increases your interest towards a product (sale?)

Question 5

Give the 3 stages of decision making proposed by Rothschild, 1984

Answer 5

Rothschild, 1984

1. High or low
2. Processing (searching for information
3. Evaluating alternatives

Question 6

How many stages in the Product Life Cycle (PLC)?

Answer 6

Baines et al, 2011

- 5

Question 7

What are the stages of the PLC?

Answer 7

Baines et al, 2011

• Development
• Introduction
• Growth
• Maturity
• Decline

Question 8

Describe the Introduction stage of the PLC:

Answer 8

Baines et al, 2011

• The riskiest stage of the PLC as its the most expensive
• Lots of advertising & other communication tools: costly
• Low survival rate at this stage

Question 9

Describe the Growth stage of the PLC:

Answer 9

Baines et al, 2011

• A sharp rise in sales & profits should be seen
• Distribution & availability becomes greater
• Advertising still needed as product is not in the mass market yet

Question 10

Describe the Maturity stage of the PLC:

Answer 10

Baines et al, 2011

• Once the majority of consumers have been won over, this stage is reached & competition has been fought off
• Brand is well known and easily recognisable
• Sales begin to plato
• Maximum profits are made
• Brands have the potential to diversify
• Advertising at this point is just concerned with highlighting the difference between the product & its competition
• Price is also lowered

Question 11

Describe the Decline stage of the PLC:

Answer 11

Baines et al, 2011

• The customers preference actually change (their values & beliefs) as there is superior technology available
• Advertising doesn’t stop but is reduced dramatically
• Distribution also becomes very selective and is moved to more targeted places, dropping the less successful

Question 12

What is adoption?

Answer 12

This is about how customers react and interact with new products. This is NOT a uniform process and can happen at different times/speeds

Question 13

What is diffusion?

Answer 13

How much the products are taken up, and how they are spread

Question 14

What is one model of diffusion?

Answer 14

Rogers S-Curve

Question 15

How many stages does Rogers S-curve as a model of diffusion contain?

Answer 15

5

Question 16

Outline the stages of Rogers S-Curve model:

Answer 16

Baines et al, 2011

• Innovators
• Early adopters
• Early majority
• Late majority
• Laggards

Question 17

Explain the stage of innovators as part of Rogers S-Curve model as a process diffusion:

Answer 17

Baines et al 2011
Innovators (2.5%):
- 1st to try new product, tend to be educated , young, confident and financially strong
- Actively seek out new information
- More likely to take risks
- Cannot mass market to them as too smaller group, specialist stores must be used

Question 18

Explain the stage of Early Adopters as part of Rogers S-Curve model as a process diffusion:

Answer 18

Baines et al 2011
Early Adopters (13.5%)
- This stage has the potential to accelerate adoption process as it can contain many opinion leaders
- Tend to be younger, above average education & financially stable & are the most communicative stage!
- These individuals are still looking for information & are risk takers, as the product may not be finalised

Question 19

Explain the stage of Early Majority as part of Rogers S-Curve model as a process diffusion:

Answer 19

Baines et al, 2011
Early Majority (34%)
- Product is moving into the mass market and is therefore becoming less risky
- Above average age and education, social status and income
- Distribution is wider and more intensive
- Price becomes more competitive whilst the social pressure rises
- Mass marketing is conducted

Question 20

Explain the stage of Late Majority as part of Rogers S-Curve model as a process diffusion:

Answer 20

Baines et al, 2011
Late Majority (34%)
- These people are more skeptical of new ideas/innovations and usually only adopt because of social and economic factors
- Below average education, social status and income
- Product is now completely mass market

Question 21

Explain the stage of Laggards as part of Rogers S-Curve model as a process diffusion:

Answer 21

Baines et al, 2011
Laggards (16%)
- Very suspicious of new things
- Will very reluctantly take accept it if at all
- Difficult and hard to reach by normal means of communication
- Lower socioeconomic status, tend to be older people

Question 22

What is an opinion former?

Answer 22

Someone who has formal training qualifications or experience in a subject area and is seen as an expert

Question 23

What is an opinion leader?

Answer 23

These are individuals who are influence others as they are perceived as skilful. They generally seek information and are the ‘early adopters’ in Rogers S-Curve diffusion theory

Question 24

What is an opinion follower?

Answer 24

They seek guidance from either opinion formers or leaders