Article: Modelling successive generations for products-in-use and number of products sold in the market Journal: International Journal of Operational Research (IJOR) 2015 Vol.24 No.2 pp.228 - 244 Abstract: As most of the high-technology companies are trying to be more demand driven, technological innovation and diffusion have become important force in today's market. High technology product comes in generations where a new generation offers a significant improvement in performance or benefits over the preceding generation. These successive generations under the same product category often compete in the market. The purpose of this paper is to propose a modelling framework that describes how a fraction of potential purchasers of earlier generation shift to the latest one via; substitution and switching. The proposition explains how actual the number of users is always lesser than the number of customers who buy a particular generation. The study proves that there is a relationship between the proposed model and Norton-Bass model and asserts that Norton-Bass model is a model to explain products-in-use and not products sold in the market. Empirical implications of the proposed model have been validated on data collected from two industries (Mainframe Industry (USA) and Semiconductor Industry DRAM shipments). Inderscience Publishers - linking academia, business and industry through research

Title: Modelling successive generations for products-in-use and number of products sold in the market

Authors: Deepti Aggrawal; Adarsh Anand; Ompal Singh; P.K. Kapur

Addresses: Department of Operational Research, Faculty of Mathematical Sciences, University of Delhi, Room No. 207, 2nd Floor, Delhi-110007, India ' Department of Operational Research, Faculty of Mathematical Sciences, University of Delhi, Room No. 207, 2nd Floor, Delhi-110007, India ' Department of Operational Research, Faculty of Mathematical Sciences, University of Delhi, Room No. 207, 2nd Floor, Delhi-110007, India ' Amity University Campus, I-3 Block, Ground Floor, Sector-125, Noida-201301 Gautam Buddha Nagar, UP, India

Abstract: As most of the high-technology companies are trying to be more demand driven, technological innovation and diffusion have become important force in today's market. High technology product comes in generations where a new generation offers a significant improvement in performance or benefits over the preceding generation. These successive generations under the same product category often compete in the market. The purpose of this paper is to propose a modelling framework that describes how a fraction of potential purchasers of earlier generation shift to the latest one via; substitution and switching. The proposition explains how actual the number of users is always lesser than the number of customers who buy a particular generation. The study proves that there is a relationship between the proposed model and Norton-Bass model and asserts that Norton-Bass model is a model to explain products-in-use and not products sold in the market. Empirical implications of the proposed model have been validated on data collected from two industries (Mainframe Industry (USA) and Semiconductor Industry DRAM shipments).

Keywords: high technology product; high tech products; product-in-use; successive generations; product substitution; product switching; modelling; product generations.

DOI: 10.1504/IJOR.2015.071496

International Journal of Operational Research, 2015 Vol.24 No.2, pp.228 - 244

Received: 12 Aug 2013
Accepted: 07 Oct 2013
Published online: 31 Aug 2015 *

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Title: Modelling successive generations for products-in-use and number of products sold in the market

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