The impact of adoption timing on new service usage and early disadoption

Prins, Remco; Verhoef, Peter C.; Franses, Philip Hans

doi:10.1016/j.ijresmar.2009.07.002

Cited by 39 publications

(25 citation statements)

References 63 publications

(89 reference statements)

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“…Applying repeat-purchase individual-level mechanisms, as well as developing models for sales rather than for adoption, can assist in understanding the relative roles of repeat purchase vs. initial adoption in the diffusion process and the influences of these factors on growth and long-term profitability. Initial efforts were made by Prins, Verhoef and Frances (2009) in the context of telecommunications services. Individual-level models should also be extended to allow for flexibility in determining the unit of adoption.…”

Section: Diffusion Social Network and Network Externalities: Futurmentioning

confidence: 99%

Innovation diffusion and new product growth models: A critical review and research directions

Peres

Muller

Mahajan

2010

International Journal of Research in Marketing

776

450

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Section: Diffusion Social Network and Network Externalities: Futurmentioning

confidence: 99%

Innovation diffusion and new product growth models: A critical review and research directions

Peres

Muller

Mahajan

2010

International Journal of Research in Marketing

776

450

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“…To incorporate interdependence between the different model components, we allow for correlations between the intercepts. 7 The expected values of the retention and usage intercepts α0i, 0i, and 0i are functions of the concomitant customer characteristics age, household size, income (e.g., Rust and Verhoef 2005), and time-to-adoption (Prins, Verhoef, and Franses 2009;Schweidel, Fader, and Bradlow 2008): where Agei, is the age of customer i (in years, shortly after service launch), Hhsizei, is the size of customer i's household (in number of persons), Incomei is the average income in the census block to which customer i belongs (in €10,000), and Adopttimei is the time-to-adoption of customer i (measured in months following the launch of the iTV service).…”

Section: Customer Heterogeneitymentioning

confidence: 99%

The Challenge of Retaining Customers Acquired with Free Trials

Datta

Foubert

Heerde

2015

Journal of Marketing Research

115

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Many service firms acquire customers by offering free-trial promotions. However, a crucial challenge is to retain the customers acquired with these free trials. To address this challenge, firms need to understand how free-trial customers differ from regular customers in terms of their decisions to retain the service. This article conceptualizes how marketing communication and usage behavior drive customers’ retention decisions and develops hypotheses about the impact of free-trial acquisition on this process. To test the hypotheses, the authors model a customer's retention and usage decisions, distinguishing usage of a flat-rate service and usage of a pay-per-use service. The model allows for unobserved heterogeneity and corrects for selection effects and endogeneity. Using household panel data from a digital television service, the authors find systematic behavioral differences that cause the average customer lifetime value of free-trial customers to be 59% lower than that of regular customers. However, free-trial customers are more responsive to marketing communication and usage rates, which offers opportunities to target marketing efforts and enhance retention rates, customer lifetime value, and customer equity.

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“…Future research could also investigate the impact of dispositional innovativeness and other consumer characteristics on alternative measures such as the size of consumers' asset allocation shifted into or withdrawn from an innovative product category (cf. Prins et al, 2009). Note: a. Superscripts represent significant mean differences between cells based on independent LSD tests (p b 0.05).…”

Section: Limitations and Further Researchmentioning

confidence: 99%

“…This need becomes even more pressing considering the size of the industry, the investments made during product development and launch (Easingwood & Storey, 1991), consumers' increased self-responsibility for retirement (Goldstein et al, 2008), and the fact that individual investors hold about 50% of U.S. equity (Barber & Odean, 2000). Consumer innovators are key to the ultimate marketplace success of new products (Rogers, 1995) as they are amongst the first to accept them, show increasing usage after adoption (Prins, Verhoef, & Franses, 2009), and propel adoption by others through "social proof" or WOM effects (Cialdini, 2001). Hence, to quickly build a critical mass of early adopters and recover their investments, managers in the investment industry should be able to identify and target consumer innovators.…”

Section: Introductionmentioning

confidence: 99%