Marketing of high technology products and innovations 3rd edition mohr solutions manual

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CHAPTER 7 DISCUSSION QUESTIONS 1. What are the stages in the purchase process? What are the implications for marketing strategy in each stage?

Problem Recognition. The purchase process begins when the buyer recognizes a need, be it a problem or opportunity. Need recognition can be stimulated by internal or external stimuli.

Some examples of external stimuli would include advertising, insight provided by using the lead user process, or customer complaints. Examples of internal stimuli include occasions when employees request tools or equipment to become more productive in their jobs.

Information Search. At this stage the buyer actively searches for information about how to solve the problem. This often takes the form of identification of alternatives for solving the problem. The buyer may utilize personal sources such as friends or colleagues; commercial sources such as advertising or a vendor; public sources such as the Internet or reviews in trade publications; or experiential sources such as examining the product. Particularly for distributors or retailers of high-tech products who are making decisions about which products to carry, trade shows are important sources of information about new products and cutting-edge technologies.

Evaluate Alternatives. From a customer’s perspective, making the decision to adopt a new technology is a high-risk, anxiety-provoking one. Market and technological uncertainty make customers worried about making a bad decision, about switching costs involved, about training needs, and so forth. Understanding the factors that affect customers’ purchase decisions is vital.

High-tech marketers must be able to articulate their vision of how their product fares on each of these factors.

Purchase Decision. During the evaluation stage, the buyer forms opinions about the

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desirability of different alternatives. At the purchase stage, the buyer reaches agreement with the selected seller on the terms of purchase including: scope of the offering, price, terms of payment, and delivery. Quite often, the seller will provide an incentive such as a discount or a free service to motivate the customer to consummate the purchase.

Post-purchase Evaluation. At this stage, the buyer assesses how well the product has lived up to its potential and how satisfied s/he is with the purchase. Issues such as the following arise for the customer: • Was I able to successfully learn how to use the new technology?

• Did the technology deliver the promised benefits?

• Were there hidden costs to using the new product?

• Am I satisfied with the user experience?

These post-purchase issues loom large for tech buyers. For example, in the case of the ERP installations mentioned early in Chapter 7, many expensive implementations have been scrapped, because after years of attempting to configure the organizational processes to reap the benefits, companies are frustrated. They see many hidden costs, such as training, customization, data integration between legacy and new systems, and so forth. In such situations, it is vital that the vendor be diligent in follow-up, in ensuring that the company and product deliver on its promises, and that this phase of the process be a positive one – particularly if the vendor hopes to rely on customer testimonials or word-of-mouth referrals or future purchases.

2. What is meant by “design” and “design thinking?” What impact does design have on a company’s financial performance? What are the three ways that design can add value to an organization? How does the composition and process of a design-oriented team differ from a more traditional, analytical team?

Design is a conscious effort to produce a product, service or experience that combines both product functionality and aesthetics. Design is a multi-disciplinary field based on applied art

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(e.g., architecture, industrial design), technology, ethnography and business. Design thinking refers to a company’s focus on how human beings interact with products and their environment; the challenge is to uncover their unarticulated needs or problems. Design thinking emphasizes three multi-disciplinary considerations in decision making: human factors considerations (which requires organizational personnel who are skilled in ethnography or usability issues), design factors (which requires individuals skilled in industrial design or engineering) and business factors (which requires individuals skilled in understanding cost and revenue implications of various strategic decisions).

Design has a positive impact on a company’s financial performance. Solid empirical evidence has established the business case for design.

Design adds value to an organization in three ways, by serving as: (1) a differentiator of product, brand, or image by integrating aesthetics in product, marketing and communications; (2) an integrator of internal business processes to deliver a better customer experience and improve organizational performance; (3) a change agent in the culture of a company to make it more responsive to opportunities and challenges.

Good members of design-oriented teams have specialized knowledge and training and are also quick to learn about other domains; they demonstrate both intellectual breadth and depth.

Design thinking is very different from analytical thinking. The analytical problem solving process goes from problem specification to analysis of data to synthesis of the solution. In contrast, the design process goes from analysis to brainstorming to specification of alternative solutions to synthesis of the final solution. While analytical thinking is well-suited for linear, incremental change, design thinking is better for breakthrough insights and transformative change.

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3. What are some of the issues buyers face in the post-purchase evaluation stage? How does a vendor help buyers manage these concerns?

Some of the issues buyers face are: • Was I able to successfully learn how to use the technology?

• Did the technology deliver the promised benefits?

• Were there hidden costs to using the product?

• Am I satisfied with the user experience?

The vendor must be diligent in follow-up, ensuring that the company and product deliver on its promises, and that the post-purchase evaluation stage of the purchase process be a positive one – particularly if the vendor hopes to rely on customer testimonials or word-of-mouth referrals or future purchases. a. How can marketers target customers based on post-adoption usage patterns?

Based on customers’ post-adoption usage of a high-tech product, marketers identify four customer segments: • Intense users have a high usage of the product in a given time period and use it for many different applications; • Specialized users also have a high usage of the product within a given time period but use it for fewer applications; • Non-specialized users have a higher variety of usage but amount of usage is low; • Limited users are low on both variety and amount of usage.

User satisfaction with the product and intent to use future innovations decreases from intense users to specialized users to non-specialized users to limited users. Knowing this, marketers can target the first three segments (intense users, specialized users, and nonspecialized users) based on the expectation of repeat purchase due to their experience and satisfaction with the product. b. How can high-tech companies find opportunity in end-of-life issues for their products?

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Customers and companies must also consider “end-of-life” issues for high-tech products and appropriate disposal/recycling. Toxic waste must be collected and safely disposed of. Non-toxic waste could be disposed of in landfills, which take up space and release methane gas, incinerated, which uses energy and also releases harmful gases, or recycled. Companies can find opportunity in these issues, by incorporating them into the whole product. Innovation opportunities abound in the development process of creating recyclable products. Marketing opportunities abound in the creation of a future-oriented, forward-thinking company, which is able to incorporate social and environmental issues in the design of its products.

4. What factors influence a customer’s potential adoption of a new innovation? What are the implications of each of the factors for high-tech marketers?

1.) Relative Advantage: Relative advantage refers to the customers’ perceptions of the benefits of adopting the new technology compared to the costs. Costs may be more than just the monetary costs. In a high-tech environment, the customer will have Fear, Uncertainty, and Doubt (FUD factor) about adopting the new technology, and may incur switching costs as well (i.e., possible obsolescence of prior investments and lack of backward compatibility with legacy technology). It is not sufficient for the high-tech marketer to believe that his/her product is better; the benefits must be readily perceived by the consumer and be worth the cost of adoption.

2.) Compatibility: Compatibility refers to the extent to which consumers will have to learn new behaviors to adopt and use the new innovation. In high-tech markets, the issue of compatibility is especially important when considering interfaces to former products and complementary products. Products, which are incompatible with standard ways of doing things require more education from the marketer, and customers take more time to get familiar with how to use them. Thus, marketers must reduce the physical, psychological, and financial costs

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of adopting the innovation.

3.) Complexity: Complexity is simply how difficult the product is to use. Products that are very complex are adopted more slowly than simpler products, and marketers should attempt to simplify unnecessarily complex aspects of the product. Moreover, marketers will have to focus on education and training for more complex products. This is particularly true in mainstream markets where buyers are looking for proven, reliable solutions.

4.) Trialability: Trialability is the extent to which a new product can be tried on a limited basis. Trialability reduces the risk that potential buyers perceive. This is a major issue because many new products or innovations are perceived as being complex and incompatible with older technologies. New products that can either be tried for a limited time without a commitment or that can be tried on a modular basis are generally adopted more rapidly than products that require irrevocable purchase or that are not divisible.

5.) Ability to communicate product benefits: This factor assesses how easy it is to communicate the product benefits to prospective customers. For many high-tech products, the benefits are difficult to convey to the consumer – both in terms of language (technical terms may be meaningless to many users) and in ways that convey why the ostensible benefit is a compelling one. Marketers must speak in terms that are meaningful to the user, and that simply and compellingly communicate the benefits. The promotional program, whether based on mass media or personal selling, is the primary vehicle to accomplish this.

6.) Observability: This refers to how easy it is for the customer to observe the benefits s/he is receiving from using the new technology, as well as how easy it is for other consumers to observe the benefits that other adopters obtain from using the new product. Products used in a public manner and that provide easily observable benefits are adopted more quickly.

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Demonstrations, trade shows, and dynamic Web sites are useful means for allowing potential customers to observe.

These six factors are crucial hurdles to overcome in effective marketing. Marketers must provide compelling reasons for adoption, and overcome customers’ fear, uncertainty, and doubt.

Traditional marketing methods (which assumes customers understand the usefulness of the products and know how to evaluate them) are typically insufficient. Rather, marketers must focus more on educating potential users about benefits and how to use the new product.

Moreover, it is vital to involve customers in evaluating new product ideas. One shouldn’t base his/her assessment of likely product success on the inventor’s own familiarity with, and enthusiasm for, the technology. It is important to understand who is likely to be an early adopter, and how those early adopters differ from the mainstream market.

5. Studies show that customers desire complex products prior to purchase, but then experience negative emotions after using them. What are the implications of these studies for the ways marketers ought to manage complexity in high-tech products?

Marketers must proactively consider the level of complexity of their products during the development process, as well as how they communicate, or set expectations, for complexity for customers in their marketing communications strategies. It is up to the marketers to not only communicate the features of the product to customer, but acknowledge the customer’s negative emotions in such a way as to educate the customer on how to overcome them. Marketers must remain in communication with the customers even after the purchase of the product, in order to develop a positive bond between the customer and product, reaffirming the customer in his/her purchase decision.

6. What are the categories of adopters and their characteristics? What are the appropriate marketing strategies for each of the categories?

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Innovators or technology enthusiasts, appreciate technology for its own sake and

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enjoy being an agent of change amongst the people in their reference group. Often they are willing to develop make-shift solutions to problems encountered with new technologies. Although this group is small and not a large source of revenue, they are key to understanding the early adopters. Therefore, their input should be sought and studied when developing and marketing high-tech products.

• Early adopters or visionaries, adopt and use technology to achieve a revolutionary breakthrough to gain competitive advantage in their industries. They generally demand personalized solutions and a high level of service and support. This group is wiling to accept minor problems with new technology for the benefits they receive. This group typically provides the initial cash flows for a new technology.

Marketing to this group requires customized development and technical support for each customer. Due to this, the high-tech firm is often pulled in multiple directions, which can be costly. However, because of the importance of this group in reaching the mainstream market, and the firm’s need for cash flow, marketers face pressure to meet the needs of these customers, and often release products early to this group. The firm must pay close attention to cultivating its reputation at this stage.

• Early majority or pragmatists, are willing to adopt evolutionary changes in their operations in order to gain productivity enhancements. They are averse to major changes and disruptions, and therefore, tend to be willing to adopt only proven products with a track record of success and reliable service. They tend to choose a solution that has been recommended by a trusted colleague – from within their own industry.

In order for marketing to be effective in reaching this group, the firm must develop a complete, end-to-end solution to the customer’s needs. This is known as the “whole” product, and includes all necessary hardware, software, service, training, and infrastructure to make a product functional. A firm typically cannot develop all these requisite components alone, and hence, must work closely with partners. Moreover, pragmatists often require simpler, rather than more complex, features, and a high degree of customer service. These skills are often the opposite of what great engineers offer.

• Late majority or conservatives, are risk averse and very price sensitive. They expect “bullet-proof,” integrated solutions and are motivated to purchase new technology only to keep up with their competitors. To market to conservatives requires even more focus on simplification, convenience, reliability, and pricing.

• Laggards or skeptics, do not believe that technology can enhance productivity and will be extremely reluctant to purchase new technology. Marketing to this group is similar to marketing strategies for conservatives. However, a large amount of effort should not be made to reach laggards.

7. What is the chasm? Compare and contrast the marketing strategies that are necessary in the early market versus the mainstream market.

The chasm is the gap in sales between the early adopters and the mainstream market. This chasm arises when the early market is saturated, but the mainstream market is not ready to adopt the new technology.

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Marketing strategy should be focused to minimize time in the chasm. In order to do this, a firm should identify the needs of the early majority market to develop a complete solution. This requires an in-depth analysis of the customers’ needs. Once those needs have been identified, a firm must develop the best solution possible, or partner with firms that can contribute to the new technology platform. Customer service is also a critical component of crossing the chasm.

At this stage a beachhead, or single target market, should be identified to market to the mainstream. This requires that the customers have a single compelling reason to buy. The beachhead should provide clear opportunities to enter adjacent segments. If one uses a bowling pin analogy, the beachhead should be the lead pin; adjacent market opportunities would be the pins immediately behind the beachhead. The objective of the bowling pin model is to approach new market opportunities by leveraging knowledge about technologies or segments.

8. What are the two key decisions a company must make to cross the chasm?

1.) Identify a good beachhead, a single target market from which to pursue the mainstream market. The idea is to penetrate the market via this targeted group, which will adopt the product and spread it to adjacent segments.

2.) Partner to develop a whole product solution, an integrated, end-to-end solution that allows the customer a seamless experience in buying the company’s product. While visionaries are willing to tolerate some incompleteness in a product, the mainstream requires a complete, end-to-end solution. Deciding who to partner with in order to achieve a whole product is an important decision for a company.

9. What are the two critical characteristics of a good beachhead? Why? The two critical characteristics of a good beachhead are:

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• Customers have a single, compelling, “must have” reason to buy that maps fairly closely on to the capabilities of the firm.

• The selected beachhead provides “adjacencies” to enter related, contiguous segments.

These two characteristics work in conjunction to use the beachhead to bridge the chasm. In identifying those customers most willing to adopt the new product, the company can market to them directly. But the chasm can only be bridged if these new customers can successfully communicate the new product to other customer segments in their category. a. Explain a compelling reason to buy for pragmatist customers.

A compelling reason for the pragmatist customer to buy is the understanding that the investment in the new product will generate quantifiable results. The purchase of the new technology will drastically improve the company’s productivity on a well-understood, critical success factor. b. Explain the bowling pin model used to identify adjacencies. What are the key attributes for adjacent market segments?

The objective of the bowling pin model is to proactively identify new market opportunities by leveraging knowledge about technologies or segments. The beachhead is the lead pin; adjacent market opportunities are the “pins” immediately behind the beachhead. The key attributes of adjacent market opportunities are (1) new market segments into which the firm can sell its existing technological solution or (2) current market segments into which the firm can sell new technological solutions. Once the beachhead has adopted the new technology, the adjacent market segments will be willing to adopt the new technology as well – similar to the lead pin bowling over the adjacent pins. c. How many market segments can a high-tech company realistically pursue in crossing the chasm? Why? Realistically, a high-tech company can only pursue one market segment in order to cross the

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chasm. By focusing on one segment, the company is able to learn the customer-specific knowledge and language necessary to become credible with that segment. The resources are focused and not stretched too thin. If they pursue more than one segment, the marketing resources are not effective in any one segment; the marketing initiatives cannot rise to an influential level in any segment. Success in just one segment can be the catalyst required to succeed in other segments.

10. What is a whole product solution? How does a high-tech firm typically develop it?

The whole product solution addresses the pragmatists’ need for a total product, without the missing pieces or incompleteness the visionaries are willing to accept. The complete, end-to-end solution requires the company to assume total responsibility for system integration. The definition of a whole product should be done within the confines of a single target market because needs are common within that target market but may differ significantly across segments. A high-tech firm must conduct an exhaustive analysis of what it takes to define the whole product for a customer. This includes a study of the customer’s entire consumption and usage system including identifying switching costs and exposure. Further, if the firm does not have all the know-how needed to develop the whole product in-house, it should look to partnerships for technology licensing, R&D or product development to come up with all the pieces of the desired solution.

11. What are four other issues that companies must address in crossing the chasm?

• Customers typically demand some sort of industry standard to minimize their perceived risk. An industry standard allows customers to abandon a “wait-and-see” attitude.

• Customers want to see a competitor’s proposal and product offering before making a decision. In contrast to the product-form competition between the new technology and older technology platforms that existed in the early market, competition now is between vendors within the new technology category. To a pragmatist, competition is a sign of

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legitimacy.

• A company must simplify, rather than add additional features to its product. Rather than developing the “best possible solution,” the company now must develop the best possible solution.

• Customer service is a critical component of crossing the chasm. This may require engineers to go to customer sites to observe the use of their product in action and provide the customer service needed to enhance the user experience.

12. What are the three phases of the pragmatist market (from Inside the Tornado)?

Firms that are successful in crossing the chasm typically experience dramatic sales increase (or a tornado) when they enter the mainstream (pragmatist) market.

1.) The Bowling Alley is the period when the new product gains acceptance from niches within the mainstream market. Each niche requires expertise in that vertical market, and potentially leads to access to related markets.

2.) The Tornado is the period of mass-market adoption when the general marketplace switches over to the new technology. It is driven by an application that provides compelling benefits to mass market, or the “killer ape.” This period requires strong operational excellence in order for the firm to keep up with demand.

3.) During the final phase of the mainstream market adoption, “Main Street,” market growth stabilizes. A firm should focus its efforts on cross selling and upgrading to existing customers.

13. What are the unique marketing issues in reaching the conservatives in the market?

Marketing to conservatives requires making the product even simpler, cheaper, and more reliable and convenient, and possibly splitting the product line into simpler components. Rather than adding more interesting features and cool “wow” factors, engineers should actually do the opposite. Because this is so foreign to product development in high-tech firms, many high-tech companies leave the conservatives’ money on the table. However, this may represent an opportunity in marketing as well as product development for companies willing to identify the conservatives as a unique customer base.

14. What are the four steps in segmenting markets?

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1.) Divide possible customers into groups, based on common characteristics such as demographics, geographics, psychographics, or behavior variables (usage frequency, usage occasion, benefits sought). The purpose of this step is to distinguish between customer groups in terms of the choices they make and the reasons they buy.

2.) Profile, or describe a typical customer in each segment. These descriptions can help in understanding the various segments.

3.) Evaluate the attractiveness of various segments, based on size of the segments, growth rates of the segments, competitive intensity within the segments (what competition exists, and how hard will existing firms work to protect their share), and the firm’s abilities to serve the needs of the customers within each segment.

Based on this analysis, a firm can select a target market to pursue.

4.) Position the product within the selected target market.

15. What is the difference between vertical market segmentation and horizontal market segmentation? When is one approach versus the other more likely to be used?

The difference between vertical market segmentation and horizontal market segmentation lies in the degree of specialization by which the industry segment is defined. Horizontal market segments span industry boundaries and often use technology to automate a specific business process or function. Vertical market segments are industry-specific markets.

Horizontal segmentation approaches can make more sense when customers across industries share a common approach to the use or benefits they find in adopting technology. On the other hand, vertical segmentation is appropriate when customer use or value of technology products varies by industry, and they require different value propositions. While vertical segments may appear to have smaller potential, the fact is a high-tech company can garner a larger share of the market within the segment, commanding a leadership position that can be exploited elsewhere.

Vertical markets require customization and trade-off volume for margin. On the other hand, horizontal markets have high volume demand for standardized products.

16. What are the four criteria commonly used to evaluate and select a target market? What is the 80/20 rule and how is it adapted for base-of-the-pyramid market strategies?

The four criteria commonly used to evaluate and select a target market are:

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• Size. Estimates of the potential sales volume within each segment are needed in order to identify segments that are large in size.

• Growth. First, the growth means that the firm will be able to capitalize on customers’ needs and grow with the market. Second, the growth means that, rather than stealing customers away from other firms, firms can capture new customers coming into the market.

• Level of competition. Estimates of the level of competitive intensity within each segment help a firm to identify how costly it may be to pursue that segment. High numbers of competitors or even a few powerfully entrenched competitors can pose formidable risks to a new firm.

• Capabilities of firm to serve the needs of that segment. Finally, firms must take a good hard look at their core competencies and strengths to determine if they have the capabilities to serve the needs of a particular segment. Although partnering can augment some deficiencies, the reality is that customers will look to firms that offer the right set of skills to address their needs.

The 80-20 rule says that 80 percent of the sales in any one category typically come from only 20 percent of the customers. The pyramid refers to the world’s population organized into income tiers, higher tiers reflecting more affluence than lower tiers. Straightforward application of the 80-20 rule would suggest targeting affluent tiers at the top of the pyramid. However, recent writings by C. K. Prahalad and others suggest that there is money to be made by offering appropriate, affordable products to the bottom tiers of the world’s population, trading off margin for volume.

17. What is positioning and how should a new innovation’s position change over the diffusion process?

Positioning is the way customers perceive a product’s value proposition. It is the image of the product in the eyes of the customer, relative to competitors, on critical attributes of importance.

Since positioning is based on customers’ perceptions and these customers and their perceptions change throughout the diffusion process, the positioning of the product must change with it. As the new technology is adopted by customers and begins to diffuse through the

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marketplace, competition based on the new technology will develop. The positioning changes from “something totally new,” that displaces an older technology, to brand competition.

Relative positioning strategies must now implicitly reference this brand competition (i.e., selective demand). Finally, in late stages of the adoption process, the market leader needs to create new products that will cannibalize its old products. As a result, positioning may reference the company’s prior version of the product in addition to competitor offerings.

18. Explain how multi-attribute models and perceptual maps can be used to help diagnose a company’s positioning strategy.

Multi-attribute models collect data from a sample of customers about the relative importance of attributes (product benefits and features) in their technology purchase decision, and then assess how well a company’s and its key competitors’ products stack up on those features.

Perceptual maps use the same data as multi-attribute models, but consolidate multiple attributes into two higher-level attributes using statistical techniques. Perceptual mapping produces a simple visual graphic of a company’s offering (positioned on these two key attributes) versus the competition. A perceptual map can also display what consumers’ ideal points or preferences are.

These tools can be used to help diagnose a company’s positioning strategy. Since positioning is based on customers’ perceptions, analyzing the customers’ relative importance of attributes provides the company with the information necessary to developing its position in the marketplace. Best-practices marketing must explicitly address customer perceptions. A company wants to position on its strengths, but to ignore the barriers customers perceive is naïve.

19. What are the issues customers face in attempting to avoid obsolescence of their technology purchases? What are the impacts of customers’ expectations about the pace and

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magnitude of performance improvements and price declines on their technology adoption decisions? Of the four types of migration paths companies can offer, what path should be offered under which conditions?

Fast and significant improvements to high-tech products complicate the purchase decision for customers. The steady stream of improved and overlapping product generations typically makes the customers’ investments in prior generations obsolete, even while those investments are still perfectly functional in use. Customer investments in prior-generation, legacy systems act as an inhibitor to purchase of newer generations. Business customers face a gap between a product’s useful technological life (shorter than three years, in most cases) and its “accounting” life (for depreciation purposes, usually five years for durable assets). As a result, business customers are interested in upgrades that allow them to protect their investments in technology by providing benefits of “new and improved” without scrapping the old version entirely.

Customers make inferences about the pace and magnitude of product improvements and expected price declines. In general, the greater the anticipated product improvements and/or expected price declines, the greater the customer’s propensity to delay purchase. Firms must offer upgrade options that allow customers to salvage their investments in prior generations of technology.

The various options along the migration path are based on the degree to which the customer’s options in the transition are more constrained versus enlarged. The four migration options available to marketers are: 1.) Withdraw the older generation as soon as the new one is launched, with no assistance to the installed base. Lack of parts and service for these customers forces them into a decision about migration sooner than they might like.

2.) Withdraw the older generation when the new one is launched, but offer migration assistance, which can be in the form of technical help, trade-ins, backward compatibility with gateways, and the like. Customers can upgrade and maintain the older version or move to new version later.

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3.) Sell old and new generations together for a period of time, after which the old generation is withdrawn. Customers can continue with installed version A, migrate to next generation B, or skip B entirely (leapfrog) and go to C. 4.) Sell both generations as long as the market desires them and provide migration assistance to the installed base.

When customers expect rapid advances, it pays for a firm to increase options. Customers who anticipate a rapid pace of change tend to wait for price declines or bug fixes in the newly launched version. These customers can also bypass completely, waiting for some yet-to-belaunched future version. Both stalling and leapfrogging are mitigated by migration assistance.

Without such assistance, firms will find their revenues swinging wildly.

When customers expect a large magnitude of change in the technology advancements, they also recognize that smooth upgrading is unlikely. In such a situation, few customers are willing to wait to purchase an older generation of the product at a reduced price, which will be made obsolete. The firm may choose not to offer migration assistance. In essence, there is less to be gained by keeping the customers’ options open. Where customers anticipate large discontinuities between generations, the firm may choose not to offer migration assistance.

When customers have anxiety about making a decision, the marketer should provide migration assistance. A firm can choose to sell both the old and new versions to encourage customers with even older installed version to migrate to the next step.

20. Of the eight paradoxes of customers’ relationships with technology, identify and describe three that you find most interesting. Give your own example of each. What are the marketing implications?

1.) Control-chaos. Technology is supposed to help bring order to our lives and business.

However, once purchased, technology can disrupt our everyday routines. For example, as a society, we have become so dependent on computers that if they fail, we can no longer work.

2.) Assimilation-isolation. Many technologies help us to connect with other people, either by facilitating communication or by providing shared experiences. But these technologies have also become a substitute for face-to-face communication, personal contact, and other social

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activities. Ultimately, when we log on to virtual communities, we sit alone at our computers. Research shows the more hours people spend on the Internet, the more depressed, stressed, and alienated they feel, even if most of their time is spent sending messages or interacting with others. False feelings of intimacy, timelessness, and lack of inhibition contribute to the addictive force of the Internet.

3.) Intelligence-stupidity. Sophisticated products are supposed to help us be smarter by allowing us to perform complex tasks. But if the products are difficult to master or cause us to lose old skills, we actually feel inadequate or inferior in mastering new technologies.

4.) Freedom-enslavement. Products that offer freedom can end up creating new restrictions. For example, voice mail gets us away from our offices, but makes us feel obligated to check our messages constantly.

5.) Engagement-disengagement. Although some technologies are designed to make participating in activities easier, they may detract from the quality of the experience. For example, instead of smelling and squeezing lemons for ripeness, we can now order them from a Web site. The very things that are supposed to simplify our lives and allow us to stay in touch with each other are putting us further out of reach with sense-dulling “conveniences.”

6.) Efficiency-inefficiency. New technology can help us perform tasks faster, but also creates time-consuming new chores. For example, while email provides a fast and efficient means of communication, it requires the recipient to invest time and energy in deleting unwanted junk mail.

7.) Fulfilling needs-creating needs. Many technology products make us aware of new needs even as they fulfill others. For example, although we might be able to use software to perform more sophisticated tasks, we also now need to attend training programs to learn how to use the software to do those tasks.

8.) New-obsolete. Although people are excited by owning cutting-edge products, their excitement is chronically undermined by a fear of falling behind. This paradox creates both the simultaneous desire to purchase new technologies and to delay purchase in order to wait for the latest/best technology.

Potential purchases of technology create coping strategies to lessen the presence of the paradoxes. Understanding such coping strategies can give marketers insight into segments of technology consumers and the differing types of marketing messages that may be useful, given consumers’ concerns. Unfortunately, technology marketers, with their enthusiasm for the products they market, are sometimes blind to the dual impacts of technology from a customer’s perspective. At a minimum, marketers must be alert to the presence of the paradoxes, try to actively consider what the unintended consequences of a new technology might be, and develop

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contingency plans for their marketing efforts.

21. Of the four ideological views of technology, which combination/juxtaposition most accurately captures your own complicated relationship with technology?

For most business or engineering students, we would expect more ideological views on the side of Techtopians or Work Machines. To a lesser extent these students are likely to respond as Techspressive. We would not expect such students to have a Luddite view but more young people are interested in the Green movement, to lessen the destructive impact of technology on our planet.

22. Identify and describe one unintended consequence arising from technology. If you were the manager marketing products based on this technology, how would you handle this unintended consequence?

Here are a couple of examples of unintended consequence of technology. Merck launched Vioxx in the USA in 1999 as a non-steroidal anti-inflammatory drug that was approved by the FDA to treat patients with arthritis and other chronic and acute pain. Within a couple of years Vioxx patients began complaining of heart attacks and strokes. Initially Merck did not take responsibility for these side effects. But in 2004 Merck voluntarily withdrew Vioxx from the market and faced a number of class-action lawsuits from victim’s families, which have cost the company billions of dollars in settlements.

In 2006 Apple and Dell laptop users complained of their laptops overheating. The problem was traced to defective lithium ion batteries supplied by Sony. After initially dragging its feet, Sony agreed to replace all defective batteries at no charge to customers. In this situation there was economic but no physical loss to consumers.

The first important issue for a manager is to be able to identify the unintended consequence. For this they need to have a good market intelligence system to recognize the unintended consequence early, then assess whether this is going to be positive or negative for

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their business. Such an assessment is best conducted thorough a stakeholder analysis (Chapter 13) identifying the positive and negative impact of the identified consequence on each stakeholder group. Aggregating these impacts across stakeholder groups (after assigning them relative weights) should help them arrive at the right response to the unintended consequence.

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