Eager Sellers & Stony Buyers

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Transcript of Eager Sellers & Stony Buyers

Presented by Aathira G Krishna

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By John T. Gourville

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Understanding the Psychology of New- Product Adoption

If a man can write a better book, preach a better sermon, or make a better mousetrap than his neighbour, though he build his house in woods, the world will make a beaten path to his door!!!

Innovation cost

Economic cost Psychological cost

People irrationally overvalue the benefits they currently possess relative to those they dont

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Relative advantage How individuals value prospects/ choicesPerceived value Reference point Gains and losses Loss Aversion

Losses loo lar er t an ains!!!

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Endownment effect Status quo bias

and Behavior Change Consumers and Behavior Change Companies and Behavior Change Innovations

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Skeptical about a new products performance Unable to see the need for it Satisfied with the existing product Quick to see what they already own as the status quo

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Convinced the innovation works Likely to see a need for the product Dissatisfied with the existing substitute Set on viewing the innovation as the benchmark

Consumers are usually

Companies are often

Companies overweight the new products benefits by a factor of three

Consumers overweight the incumbent products benefits by a factor of three

Easy sells

Smash hits

Sure failures

Long hauls

Accepting resistance

Minimizing the resistance Make behaviorally compatible products Seek out the unendowed Find believers

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Be patient Strive for 10 X improvement Eliminate the old

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