Pioneer Brand and Information Search: a Study in Rural India

ABSTRACT - Pioneering advantage has received much attention in the management and marketing literature. Few research studies, however, have been conducted to investigate the effect of pioneer brands in the developing country context. This research studies the effect of pioneer brands on the information search stage during agricultural input buying in rural India. 243 agribusiness buyers participated in a study wherein a pest stimulus was used to initiate the decision processes for a prophylactic and a curative application of pesticide. While the pioneering effect was clearly seen in the information search process for the prophylactic application, it was absent for the curative application. The study supports earlier studies, which state that the pioneer brands have an advantage as long as the buying situation is ambiguous. Implications for marketers are drawn.



Citation:

Pingali Venugopal (2002) ,"Pioneer Brand and Information Search: a Study in Rural India", in AP - Asia Pacific Advances in Consumer Research Volume 5, eds. Ramizwick and Tu Ping, Valdosta, GA : Association for Consumer Research, Pages: 11-13.

Asia Pacific Advances in Consumer Research Volume 5, 2002      Pages 11-13

PIONEER BRAND AND INFORMATION SEARCH: A STUDY IN RURAL INDIA

Pingali Venugopal, XLRI, India

ABSTRACT -

Pioneering advantage has received much attention in the management and marketing literature. Few research studies, however, have been conducted to investigate the effect of pioneer brands in the developing country context. This research studies the effect of pioneer brands on the information search stage during agricultural input buying in rural India. 243 agribusiness buyers participated in a study wherein a pest stimulus was used to initiate the decision processes for a prophylactic and a curative application of pesticide. While the pioneering effect was clearly seen in the information search process for the prophylactic application, it was absent for the curative application. The study supports earlier studies, which state that the pioneer brands have an advantage as long as the buying situation is ambiguous. Implications for marketers are drawn.

Pioneering advantage

Studies on the pioneering advantage have shown that the first brand to enter a new market often earns a long-term market share over later entrants (Kardes et al, 1993). The pioneering advantage has been observed in both consumer and industrial markets and in both growing and saturated markets (Gurumurthy and Urban 1992, Lilien and Yoon, 1990). Carpenter and Nakamoto (199), however, point out that the pioneer would not have the advantage when all or part of the product line has changed on a regular basis. Liebermann and Montgomery (1988) point out that shift in consumer tastes and preferences provide opportunity for the late entrants. This situation occurs when the pioneer’s competencies fail to meet the demand (Abell 1978).

Decision process and Pioneering brand

Buyers learn their preferences through trial and error, making inferences about what attributes they do and do not like. Thus, preferences for the attributes evolve with experience. Pioneering advantage is realized only if the first movers succeed in framing consumer preferences.

The preference formation process produces a competitive advantage for the pioneers in two ways. First, the pioneer develops the best position by shifting the taste distribution towards its position and second, by influencing the attribute weights buyers use to evaluate brands. Shifting preferences towards its own position generate a high share for the pioneer (Carpenter and Nakamoto, 1989). Schmalensee (1982) argues that when consumers successfully use the first brand in a new product category, they will favor it over later entrants because they know with certainty that it works. Because consumers are exposed to brands sequentially and because the first brand has a temporary monopoly, the first brand tends to have a disproportionately large effect on trial and preference.

Past research, however, shows that when the contribution of the attributes and the ideal combinations are ambiguous and penetration is sufficient, trial of the pioneer has an important role in the formation of preference for all the brands. All are compared with the pioneer, the ideal brand is perceived as close to it, and the pioneer is perceived as prototypical in the product category (Carpenter and Nakamoto, 1989; Hoch and Deighton, 1989 and Kahneman and Snell 1990).

Information search and Pioneering brand

Robinson and Fornell (1985) state that the pioneer brand can lead a long-term consumer information advantage, which can also increase market share, when price and purchase frequency are low. Kardes and Gurumurthy (1992) showed information search and information integration process influence the magnitude of pioneering advantage. As followers share many attributes with the pioneer, attribute information about the followers are more likely to be perceived as redundant and less interesting (Carpenter and Nakamoto, 1989). Kardes and Gurumurthy (1992) state that consumers learn more about the pioneer than about the followers and because judgement extremity and confidence increases as amount of information available or judgement increases, judgements of the pioneer are more extreme and are held with greater confidence. That is sequential information processing leads consumer to learn more about the pioneer than about the followers. Consequently consumers form more favorable and more confidently held evaluations about the pioneer (v/s the followers).

This research studies the effect of pioneer brands on the information search stage during agricultural input buying in rural India.

RESEARCH SETTING

The study used pesticide buying in rural India as it is a high involvement product category where the buying process would require the buyers to have sufficient knowledge of the product specifications and its usage (Seetharaman and Srivastava, 1988).

METHODOLOGY

The presumption of the study was that the consideration set represent the brands that the buyers bring to the active search process during the buying process (Moorthy et al, 1997). Data from a field survey of actual agri-business consumers was used. 243 respondents were selected using a multi-stage stratified sampling.

The survey was conducted using a stimulus, cotton bollworm (Heliothis). The buyers were familiar with the stimulus, as this has been a commonly occurring pest in these regions and the damage caused by this pest has been extensive. (A pre test was also conducted to test the familiarity of the stimulus).

Data collection involved the following steps:

The respondents were given two usage situations (a prophylactic application and a curative application) and asked "which products/ brands they would consider before making the final choice" (similar to Rantneshwar et al., 1996, Ratneshwar and Shocker 1991, Campbell 1973). A recall rather than a recognition method was used, as the shopping environment required such a practice.

Pioneer brands and "followers" from a dominant product category were identified for studying the information search.

Recall of information of the identified brands was recorded.

RESEARCH FINDINGS

Number of respondents considering the brand

During the prophylactic application nearly 75% of the respondents considered the pioneer brand as against only 47% of the respondents during the curative application. This clearly points out that the pioneering advantage was more prevalent during the prophylactic application as compared to the curative application.

TABLE 1

INFORMATION RECALL FOR PIONEER AND FOLLOWER BRANDS- PROPHYLACTIC APPLICATION

TABLE 2

INFORMATION RECALL FOR PIONEER AND FOLLOWER BRANDS- CURATIVE APPLICATION

Information recall

The information recall for the pioneer and the followers for prophylactic application and curative application are given Table 1 and 2 respectively.

Number of statements recalled: The number of statements recalled by the respondents varied between the prophylactic and curative applications and between the pioneers and the followers. While the number of statements recalled during the prophylactic application was significantly higher than the statements recalled during the curative application, the number of statements recalled for the pioneer was significantly higher than that of the "follower" only for the prophylactic application.

Type of statements recalled: While the information recalled for the pioneer brand had not changed significantly between the prophylactic application and the curative application, there has been a significant difference in the information recall of the "follower" brands. During the prophylactic application the information recalled for the followers was predominantly comparative statements, that is, statements comparing the followers with the pioneer. However, during the curative application stage the information recall has been dominated by information relating to the functioning of the brand. And during the curative application stage the information recalled for the pioneer and the followers were more or less similar.

DISCUSSION

Prophylactic applications are ambiguous situations as defined by Carpenter and Nakamoto (1989). Here the buyers cannot directly visualize the effectiveness of the pesticide and hence they would consider the pesticide effective as long as there is no major pest attack. Under such situations the pioneer brand, which enjoys a greater trial, continues to retain a higher market share. Due to some reasons if the buyers are forced to shift to another brand during the prophylactic stage (eiher due to non-availability or other situational factors) they could find the "follower" functioning similar to the pioneer and hence would consider the "follower" similar to the pioneer. The information recalled about the followers therefore contains mainly comparative statements. This again matches with the arguments put by Carpenter and Nakamoto, (1989) and Schmalensee (1982), Hoch and Deighton (1989) and Kahneman and Snell (1990).

During the curative situations the information recalled and the choice is based on the actual performance of the product. That is, the buyers would have experienced the extent of control and the effectiveness of the brand. The situation no longer continues to be an ambiguous situation. The information search and decision processes are therefore made on facts established through experience. Thus, the buyers would recall information based on the effectiveness of the brands (whether it is a pioneer brand or a follower).

The study therefore shows that the pioneer brands have an advantage only as long as the buying situation is ambiguous.

IMPLICATIONS:

When the buying situation is ambiguous as in the case of prophylactic applications the implications for the pioneers and the followers would vary. While the company marketing the pioneer brand should ensure continuous availability, the company marketing the "followers" should ensure that their brand gets a trial through retailers’ push.

When the buying situation is not ambiguous as in the case of curative applications the marketers (both of pioneer brands and followers) should concentrate on showing the effectiveness of their brands, through field level demonstrations.

REFERENCES

Abell, Derek F. (1978) "Strategic Windows," Journal of Marketing, 2(July), 21-8.

Campbell Brain M (1973). "The existence of evoked sets and determinants of its magnitude in brand choice behaviour," in Buyer Behaviour. Theoretical and Empirical Foundations, eds. John A Howard and Lyman E. Ostlund, Knopf, NY.

Carpenter, G. and K. Nakamoto (1989), "Consumer Preference Formation and Pioneering Advantage," Journal of Marketing Research, 26 (August), 285-298.

Carpenter, G. and K. Nakamoto (1994), "Reflections on 'Consumer Preference formation and Pioneering advantage’," Journal of Marketing Research, 31 (4), 570-73.

Gurumurthy Kalyanaram and G. Urban (1992), "Dynamic Effects of the Order of Entry on Market Share, Trial Penetration, and Repeat Purchases for Frequently Purchased Consumer Goods," Marketing Science, 11 (Summer), 235-250.

Hoch, Stephen J. and John Deighton (1989). "Managing what Consumers learn from experience," Journal of Marketing, 53 (April), 1-20.

Kanhneman daniel and Jackie Snell (1990), Predicting Utility" in Insights in Decision making: A Tribute to Hillel J. Einhorn, ed, Robin M. Hogarth, University of Chicago Press, Chicago.

Kardes, F. and G. Kalyanaram (1992), "Order-of-Entry Effects on Consumer Memory and Judgment: An Information Integration Perspective, Journal of Marketing Research, 29 (August), 343-357.

Kardes, F. and Gurumurthy Kalyanaram; Murali Chandrashekaran and Ronald J. Dornoff (1993), "Brand retrieval, Consideration set composition, Consumer Choice and the Pioneering advantage" Journal of Consumer Research, 20 (June), 62-75.

Lieberman, M.and D. Montgomery (1988), "First-Mover Advantages," Strategic Management Journal, 9,41-58.

Lilien, G. and E. Yoon (1990), "The Timing of Competitive Market Entry: An Exploratory Study of New Industrial Products," Management Science, 36 (May), 568-585.

Moorthy, Sridhar; Brain T. Ratchford and Debabrata Talukdar (1997). "Consumer information search revisted: Theory and Empirical analysis," Journal of Consumer Research, 23 (1), 263-77.

Rantneshwar S., Cornelia Pechmann and Allan D. Shocker (1996). "Goal-Derived Categories and the Antecedents of across category consideration," Journal of Consumer Research, 23 (Dec.), 240-50.

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Robinson W. and C. Fornell (1985),"Sources of Market Pioneer Advantages in Consumer Goods Industries," Journal of Marketing Research, 22, (August), 305-17.

Schmalensee, R. (1982), "Product Differentiation Advantages of Pioneer Brands," American Economic Review, 72 (June), 349-365.

Seetharaman S. P. and U. K. Srivastava, (1988). "Agricultural Input Marketing: Emerging Opportunities," paper presented in the seminar on Marketing in Rural Areas, Confederation of Engineering Industries, Chennai, India.

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Authors

Pingali Venugopal, XLRI, India



Volume

AP - Asia Pacific Advances in Consumer Research Volume 5 | 2002



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