Title: Multi-generational innovation diffusion modelling: a two dimensional approach

Authors: P.K. Kapur; Anu G. Aggarwal; Amir H.S. Garmabaki; Abhishek Tandon

Addresses: Amity International Business School, Amity University, Noida, Uttar Pradesh, India ' Department of Operational Research, University of Delhi, Delhi-110007, India ' Department of Mathematics and Computer Science, Islamic Azad University, Nour Branch, Nour, 46417-38373, Iran; Division of Operation and Maintenance Engineering, Luleå University of Technology, Luleå, Sweden ' Department of Business Studies, Shaheed Sukhdev College of Business Studies, University of Delhi, Delhi-110007, India

Abstract: Majority of the consumer durables have multiple technological generations. High technology product comes in new generation where a new innovation offers a significant improvement in performance or benefits over the previous generation. New innovation in the market does not immediately replace the previous one that it intends to substitute, but starts to compete with it. This creates a sequence of parallel diffusions of the existing generational products in the market. In this paper, we develop a two-dimensional multigenerational innovation diffusion model which combines the adoption time of technological diffusion and price of the technology product. The proposed model helps in studying the marketing dynamics of the products which comes in generations. Technological adoptions and the role of the other dimensions are explicitly taken into consideration using Cobb-Douglas function. Empirical implications of the proposed model have been validated on data collected from DRAM (Semiconductor Industry DRAM shipments of six generations) in two plans.

Keywords: multi-generational innovation diffusion; innovation diffusion modelling; product price; 2D models; Cobb-Douglas function; high technology products; high tech products; adoption time; technological diffusion; product generations; marketing dynamics.

DOI: 10.1504/IJAMS.2015.068048

International Journal of Applied Management Science, 2015 Vol.7 No.1, pp.1 - 18

Published online: 31 Mar 2015 *

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