Consumer Behavior in High Technology Markets

Citation:

Rashi Glazer (1995) ,"Consumer Behavior in High Technology Markets", in NA - Advances in Consumer Research Volume 22, eds. Frank R. Kardes and Mita Sujan, Provo, UT : Association for Consumer Research, Pages: 224.

Advances in Consumer Research Volume 22, 1995      Page 224

CONSUMER BEHAVIOR IN HIGH TECHNOLOGY MARKETS

Rashi Glazer, University of California Berkeley

Among the most important business phenomena of our generation is the degree to which entire categories of products and services are based on technologies that did not even exist just a few years prior to their introduction. Recent surveys of executives across a wide range of industries suggest that an increasingly high proportion (as much as 80% in some cases) of both future sales and profits are expected to stem from such "high technology" products.

At the same time, most of our understanding of consumer behavior is, at best, "technology neutral" and, at worst, rooted in both theoretical and empirical work with product categories which have essentially remained unchanged for many years with respect to their underlying technologies. While there is no single agreement as to the precise definition of "high technology," theories of competitive strategy as well as actual business practice now explicitly recognize that there are important characteristics (rapidly changing life cycles, turbulence, information-intensity, etc.) which distinguish high technology from more traditional markets. Noticeably absent from the literature, however, has been systematic investigation into what might be assumed to be one of the most important defining characteristics of any market C the nature of its consumer behavior.

The special session was designed to address this under-researched C yet crucial C issue affecting a major and ever-growing sector of modern business activity. The premise of the session was that consumer behavior in high technology markets is not just "institutional" in nature (and therefore not worthy of serious academic inquiry), but rather may be fundamentally different than behavior in traditional environments and thus demands serious study. Indeed, the motivation for the session was derived from the fact that there are an increasing number of researchers C with interests in both traditional consumer behavior, industrial organization, and marketing/technology strategy C who are beginning to explore the dynamics of consumer behavior as they relate to high technology markets. The purpose of the session was to bring together a representative sample of this research within a single forum, so as to highlight the extent to which a variety of seemingly independent research streams are conceptually and formally related.

The three papers in the session dealt with a range of issues and phenomena and differed with respect to their theoretical/empirical orientation (although, in all cases, actual data are involved). In this regard, the papers reflect the fact that he session's general topic represents a meeting ground for researchers coming from a variety of orientations.

The first paper, "A Consumer-Behavior Definition of High-Technology Markets", by Glazer and Stiving, attempts to derive a definition of "high technology" that is based less on producer-based characteristics than on consumer decision-making characteristics. After developing a conceptual framework for characterizing markets, the authors present data from a study suggesting that there is often more inter-product category variance than intra-product category variance with respect to the level of "technological intensity." Thus, for example, one company's soap offering may be deemed considerably more "high tech" by consumers than another company's computer.

The second paper, "Metrics by Which Managers Evaluate R&D Groups," by Zettelmeyer and Hauser takes an expanded view of consumer behavior C by considering internal as well as external customers for new technologies. (This wider perspective on the meaning of a customer C and hence of consumer behavior C is in itself an important development that typifies much of the on-going research in the general area of marketing and technology.) The research focuses on the methods by which managers value R&D activity (or technology) and how these internal metrics, in turn, are related to external measures of customer satisfaction with new technologies.

The third paper, "Consumer Behavior and Interactive Media", by Sultan and Winer, presents the initial findings of a rather broad research stream into the set of issues associated with emerging interactive media products and services (early efforts of the "information superhighway"). The authors present a number of hypotheses associated with consumer adoption of these new technologies that are rooted in the behavioral decision making literature. One of the features of the research is that the empirical component is based on a multi-firm panel survey of actual users of interactive media.

When taken as a group, the papers help improve our understanding not only of certain specific real-world marketing phenomena, but more generally, of the degree to which the insights about consumer decision making in high technology markets can provide the foundation for a richer (and perhaps more "realistic") consumer behavior theory.

----------------------------------------