How 'Status Quo Products' Can Make Digital Innovations Fail
Jin P. Gerlach, Rush M. Stock and Peter Buxmann, Technische Universität Darmstadt
Originally published: 2015 (PDMA Visions Magazine • Issue 1, 2015 • Vol. 39 • No.1)
Read time: 6 minutes
What do 3D television, Windows 8 and electronic books have in common? The short answer to this question: All of these products struggled with consumer acceptance when they were first introduced to the market. The more elaborate answer digs deeper into the reasons for these struggles and has to do with existing products, certain product characteristics and biased evaluations.
Status Quo Products and Their Characteristics
In an era of increasing digitization, all three of the previously mentioned innovations were meant to substantially change an existing product or product class that was already well established in the consumers’ minds or daily practices. The release of Windows 8, for instance, led to a huge outcry among users who could not operate without their “start button,” which Microsoft had conditioned them to use for two decades. Electronic books tried to replace an existing product that hadn’t changed its appearance for many centuries. These innovations faced the challenge of replacing certain status quo products and, more or less, struggled in this attempt. In fact, many technological innovations are actually imperfect substitutes for previously existing products. Consider digital cameras with electronic viewfinders, electronic cigarettes and so on.
Of course, this does not mean that all substitute products face the same challenges as these examples. One important aspect to consider is the consumers’ habituation to some existing attributes of status quo products. Consider those old-fashioned cigarettes, which have very unique characteristics that consumers might get used to over the years — the rustle of the cigarette paper when taking one out of the box, its soft feel between the fingers, even the noise of the lighter when lighting up the smoke — consumers are very accustomed to all these aspects. And then, some R&D department announces a revolutionary innovation: an electronic cigarette with an LED at its tip to simulate glowing, with all the other familiar aspects removed. Can you imagine Bruce Willis activating an electronic cigarette in the 2013 “Die Hard” movie?
Similarly, since the invention of the modern printing press by Gutenberg back in the 15th century, paper-based books have been our pathway to new insights, distant cultures and exciting fiction from all around the globe. Each book has its own individual look and feel on our shelves. We also might be a little proud of our bookshelves, as they display all of the books we have explored throughout the years. When we open up a new book and make ourselves comfortable on the couch, we experience the new book smell and we can feel the paper between our fingers when turning the page. It’s no wonder that the e-book market share has begun to stagnate, as so many readers still find that electronic books are not a real replacement for traditional books.
There are many reasons why consumers start to like the characteristics of an existing product or product category. Aesthetics, for example, is connected to experiencing something special about a book printed on paper that has a precious feel to it. This feeling often makes the content seem more valuable. Another reason could be due to an effect psychologists have labeled as mere exposure, in which we somehow start liking certain characteristics of things around us just by being exposed to them for a long period of time. I’m sure we can all think of some weird object in our apartments that might not be a thing of beauty or provide any useful functionality, but maybe we just cannot throw it away because we have started to feel a connection to this object. What happens then if some technology comes along aiming to replace the status quo product while failing to provide those much preferred characteristics?
Formation and Consequences of Negative Affect Toward Electronic Books
To answer this question, we conducted a study in the context of readers’ acceptance for electronic books. Over the course of this study, we spoke to many readers and non-readers, observed individuals presented with electronic reading technology and finally, we carried out a survey among more than 200 individuals to validate the following observation.
For many readers, the sensory attributes of printed books had become very important, as the readers had internalized these characteristics over the years. Confronting these individuals with an electronic book, they immediately showed a negative affective reaction (i.e., an emotional response such as fear, anxiety or disgust) toward it before they could even assess its functional advantages and disadvantages.
Those readers who had a negative “gut feeling” from the outset afterwards evaluated the advantages of electronic books significantly worse than those experiencing weaker negative affect or none at all. This eventually led to a much lower acceptance of electronic books for these individuals.
Figure 1 illustrates these relationships. A higher liking of books’ sensory characteristics increased the extent of a negative affective reaction toward electronic reading technology (step 1), which in turn led to worse evaluations of the technology’s functionalities (step 2). Eventually, the better the consumers’ evaluations of the technology, the higher their acceptance was (step 3).
How do we explain these observations? Consumers who have developed a feeling that certain product characteristics are very important to them will certainly be upset if those characteristics get taken away. And these upset consumers can make life very difficult for the marketing departments trying to advertise all the advantages of these new substituting products.
Individuals who experience negative affect toward an object will process information very differently from those who do not. Negative affect has a symbolic function for us human beings: It warns us that something or some situation might be problematic, and we start to process information much more skeptically. Furthermore, we also tend to only pay attention to such information that is consistent with our gut feeling, as we have a hard time holding inconsistent beliefs and feelings simultaneously. This means that consumers who have a bad feeling about a new product may not thoroughly consider all the advantages of the substitute. They may not even have the motivation to understand how the substitute works differently and how it might help improve their situation.
Conclusion
We argue that new product development can profit from being more aware of the pre-existing status quo products, which can significantly influence consumers’ adoptions of substituting innovations, especially digital goods and technologies. This does not mean that start buttons cannot be removed from digital products or technologies in general, but if such a button is removed, then consumers need convincing compensations for those product characteristics that have gained importance for them but are being taken away. For some products this may be easy, but for others it might be close to impossible.
In many cases, avoiding heavy alterations to established product designs or functionality might be the right way to go, at least in the short term. Considering radical innovations, however, communication of the product will become extremely important. Positioning a new product in an established product class could evoke adverse emotional responses in the consumers’ minds as they recall existing product characteristics they had grown accustomed to, leading to unconscious, negative comparisons. In short, we recommend product managers actively take into account those overlooked status quo products. One way to do so would be to involve target users in early stages of new product development processes to discover possible conflicts with desired characteristics of existing products. Product developers and managers need to be aware of consumers’ ties to the status quo in order to effectively communicate the benefits of their new product.
About the Authors
Dr. Jin Gerlachis an assistant professor at Technische Universität Darmstadt, Germany, where he obtained his Ph.D. in information systems. He is now conducting research in the fields of technology use and adoption, privacy management, and social media management.
Dr. Ruth Maria Stock is a professor of Marketing and Human Resource Management at Technische Universität Darmstadt, Germany. She holds a Ph.D. in marketing from the University of Mannheim, Germany, and a habilitation degree from the University of the Federal Armed Forces Hamburg, Germany. She has published in various forums, including the Journal of the Academy of Marketing Science, Journal of Product and Innovation Management, and Psychology & Marketing. Her primary research areas are innovation management, customer relationship management and leadership.
Dr. Peter Buxmann is a professor of Information Systems at Technische Universität Darmstadt, Germany. He holds a Ph.D. in general management and information systems from Frankfurt University. His main research areas are the future Internet economy, software business and information management. Buxmann is a member of the executive board of the House of IT, where he is responsible for interdisciplinary research and startups in the IT sector.