Consumer response to innovative products with application to foods Anne M.K. Michaut Promotoren: prof. dr. ir. H.C.M. van Trijp Hoogleraar in de marktkunde en het consumentengedrag Wageningen Universiteit. prof. dr. ir. J-B.E.M. Steenkamp Hoogleraar in de marketing Universiteit van Tilburg Promotiecommissie: prof. dr. R.T. Frambach, Vrije Universiteit Amsterdam, Nederland prof. dr. B. Wansink, University of Illinois Urbana-Champaign, USA prof. dr. J.H.A. Kroeze, Universiteit Utrecht, Wageningen Universiteit, Nederland prof. dr. G.A. Antonides, Wageningen Universiteit, Nederland Dit onderzoek is uitgevoerd binnen de Mansholt Graduate School. Consumer response to innovative products with application to foods Anne M.K. Michaut Proefschrift ter verkrijging van de graad van doctor op gezag van de rector magnificus van Wageningen Universiteit, prof. dr. ir. L. Speelman, in het openbaar te verdedigen op dinsdag 8 juni 2004 des namiddags te half twee in de Aula. Michaut, Anne Consumer response to innovative products: with application to foods /Anne Michaut PhD thesis, Wageningen University. – With ref. – With summary in English and Dutch ISBN: 90-8504–024-8 Abstract This thesis aims at gaining a deeper understanding of how consumers perceive product newness and how perceived newness affects the market success of new product introductions. It builds on theories in psychology that identified “collative” variables closely associated with newness perceptions on the part of the consumer. Also, it explores the effect of newness on market success after one year and the pattern of market success during that time period. It is hypothesized that perceived newness is a two-dimensional (rather than unitary) construct and that its two dimensions, (1) mere perception of newness and (2) perceived complexity, have different effects on product liking and market success over time. Consistent with our hypotheses, product liking linearly decreases with perceived complexity and cross section analysis reveals the same relationship with market success after one year. The hypothesized inverted-U shaped relationship does not hold in the case of product liking as it linearly increases with perceived incongruity (i.e. mere newness perception). In contrast, and consistent with our hypothesis, cross section analysis reveals an inverted-U relationship between perceived incongruity and market success after one year. Over time, the key findings from this work emphasize that high perceived product complexity is a disadvantage to new product success in the short run. However, market success of complex products increases over time once initial rejection is overcome (i.e. learning to like). In addition, the mere perception of newness does not appear to have a significant effect on the shape of the diffusion curve. Finally, for a given product, qualitative comparisons between countries suggest that incongruity and complexity may differentially participate to overall newness and therefore affect liking. Overall, the thesis reveals the importance of considering product newness as a two- dimensional construct since each of these dimensions brings in key information to explain consumers’ response to innovative products. Words of thanks As any new product, a thesis follows a development process before launch. Success of the outcome is largely determined by the development process and people who contributed to it. For this reason, there are a number of persons I would particularly like to thank for their input, help or support during my doctoral research. Firstly, I would like to deeply thank my advisors Professor Hans van Trijp and Jan- Benedict Steenkamp for their input, valuable comments and support. I appreciated their remarkable advice on the way to conduct research. Many of our discussions have not only directly contributed to improve the quality of my work but also greatly motivated me and developed my interest for academic research. I am grateful to Professors Jacob Goldenberg and Brian Wansink for stimulating discussions and thoughtful suggestions regarding my research. My appreciation also goes to the other members of the committee, Professors Ruud Frambach, Jan Kroeze and Gerrit Antonides for spending the time to read this dissertation. I express my gratitude to Unilever Research Vlaardingen that financially supported this thesis through Wageningen University and to a number of people who helped me in implementing my research project: Jack Stroeken and his colleagues at Innovaction, Pieter Punter and his colleagues at OP&P, the SMA and its members whom I thank for our fruitful discussions, and AC Nielsen that brought an essential contribution by providing me with adequate data to make this research possible. Of all my Wageningen colleagues, I will start by thanking Rick Schrifferstein simply because without him I wouldn’t have even thought of starting a doctoral research. I am grateful to Erno Kuiper for his insightful contribution, to Thieu Meulenberg for his valuable comments and to everybody who contributed to a pleasant working atmosphere in the ‘vakgroep’: Joost, Aad, Lynn, Ynte, Ivo, Erica, Frans, Jifke, Eric, Myriam, Nanuka and all the PhD students that have been there together with me, especially Ellen, Nikos, Xiaoyong and Stan. Finally, I am very thankful to Ellen and Liesbeth for their precious help during my stay at the department. I would also like to thank the students who contributed to the development of some issues: Nieke, Meike, Twan and Christelle it was a pleasure working with you. Finally, I would like to express my gratitude to all my friends in Wageningen for the great moments we have shared and to all my friends in France for their support. My appreciation goes to Kristine and Irina my two ‘paranimfen’ for their help and support in everything surrounding this defense. A special thank you to Deborah who contributed to the cover. A great thank you to Julien for his loving attention. At last I would like to express my deepest gratitude to my parents for their support during that time. For this I would like to dedicate this book to them. Table of contents Contents Chapter 1. ___________________________________________________________1 Introduction ____________________________________________________________________1 1.1. General context: importance of innovation _____________________________________1 1.2. Benefits of innovation for first entrants and their limitations________________________2 1.3. Success and failure of new products: the determinants ____________________________4 1.4. What is an ‘innovation’? ___________________________________________________6 1.5. Structure of the dissertation ________________________________________________12 Chapter 2. __________________________________________________________15 Theoretical framework ___________________________________________________________15 2.1. Introduction ____________________________________________________________15 2.2. The concept of newness psychologically ______________________________________16 2.3. Consequences of newness _________________________________________________20 2.4. Newness processing: the cognitive end _______________________________________25 2.5. More insight into affect and product evaluation_________________________________30 2.6. Conclusion _____________________________________________________________34 Chapter 3. __________________________________________________________35 What’s new? A multi-dimensional approach to product newness __________________________35 3.1. Introduction ____________________________________________________________35 3.2. Conceptual background ___________________________________________________37 3.3. Methodology ___________________________________________________________46 3.4. Data analysis____________________________________________________________48 3.5. Results ________________________________________________________________48 3.6. Conclusion and discussion _________________________________________________54 Chapter 4. __________________________________________________________61 Dimensions of product newness and their differential effect on market success after one year____61 4.1. Introduction ____________________________________________________________61 4.2. Conceptual framework ____________________________________________________62 4.3. Methodology ___________________________________________________________67 4.4. Data analysis____________________________________________________________69 4.5. Results ________________________________________________________________71 4.6. Conclusion and discussion _________________________________________________75 Chapter 5. __________________________________________________________81 Newness characteristics of individual products and their effects on market success over time ____81 5.1. Introduction ____________________________________________________________81 5.2. Research framework______________________________________________________82 Table of contents 5.3. Hierarchical Linear Models: a suitable tool ____________________________________89 5.4. Methodology ___________________________________________________________91 5.5. Data analysis____________________________________________________________92 5.6. Results ________________________________________________________________92 5.7. Conclusion and discussion _________________________________________________96 Chapter 6. __________________________________________________________99 Newness perception across countries ________________________________________________99