Short answer
Leverage existing technological expertise to target early adopters and innovators, and leverage market expertise to appeal to the broader, less intensive user base.
- Field
- Innovation & Markets
- Source
- Organization Science (2020)
- Method
- Empirical analysis of historical market data
- Evidence
- Strong effect
A firm's prior experience with a technology or its market significantly shapes its ability to capture different user segments upon market entry. This innovation & markets research insight is drawn from a 2020 study published in Organization Science. Using Empirical analysis of historical market data, researchers explored how this design variable affects real-world outcomes. The key design takeaway: Leverage existing technological expertise to target early adopters and innovators, and leverage market expertise to appeal to the broader, less intensive user base.
Pre-entry technological experience drives early adoption, while market experience targets mass-market users.
A firm's prior experience with a technology or its market significantly shapes its ability to capture different user segments upon market entry.
Organization Science · 2020
Key Findings
- 01Pre-entry technological experience is associated with attracting intensive users, particularly when entering the market early.
- 02Pre-entry market experience is associated with attracting lighter users, aligning with mass-market adoption.
Application
Design takeaway
Leverage existing technological expertise to target early adopters and innovators, and leverage market expertise to appeal to the broader, less intensive user base.
How to apply
Before launching a new product, assess the company's technological and market experience. If targeting early adopters, emphasize technological depth. If targeting the mass market, emphasize market understanding and user-friendliness.
Project actions
- 01When defining your target audience, consider what kind of experience your design or manufacturing team has.
- 02Think about whether your project is aiming for early adopters or a wider market, and how your team's background fits that goal.
Method & Evidence
Variables
Strengths & Limitations
Strengths
- +Utilizes a large-scale, real-world industry dataset.
- +Differentiates between two distinct types of firm experience and their impact.
Limitations
The specific industry studied (2G mobile phones) might have unique characteristics that don't apply to all product categories. The definition of 'intensive' vs. 'lighter' users could be subjective.
Reliability & validity
The study's reliance on historical industry data for performance metrics and inferred experience levels may introduce potential for measurement error or confounding variables. The broad definitions of 'technological' and 'market' experience could impact construct validity.
Think critically
How might the 'fit' between firm experience and consumer preferences change as a technology matures and the market evolves?
Design Principles
"Align firm experience with target user segment characteristics for optimal market entry performance."
Understanding the nuances of pre-entry experience allows design and product development teams to strategically position new technologies. This insight is crucial for forecasting market reception and tailoring product roadmaps to specific user groups, ultimately influencing market penetration and adoption rates.
What This Means for Your Design
If your company knows a lot about making a certain type of tech, it's good at getting the first people who really love that tech to buy it. If your company knows a lot about selling things to people in general, it's better at getting lots of regular people to buy it later.
How to use in your project
- 1.Use this research to justify why you are targeting a specific user group based on the capabilities and experience of a hypothetical or real company.
- 2.Discuss how the type of experience your design team has might influence the product's market entry strategy.
Add to My Project
Quick Cite
Paragraph starter
The strategic implications of pre-entry experience are significant for new technology market entry. Research indicates that firms with deep technological experience are better positioned to attract early, intensive users, aligning with the characteristics of early adopters. Conversely, firms with extensive market experience tend to appeal more effectively to lighter users, which is consistent with strategies for mass-market penetration. This suggests that a firm's prior expertise should be carefully considered when defining target user segments and tailoring product development and marketing efforts for optimal post-entry performance.
Source
Organization Science
Experience, Consumers, and Fit: Disentangling Performance Implications of Preentry Technological and Market Experience in 2G Mobile Telephony
journal · 2020
View sourceQuestions About This Research
- What does the research say about pre-entry technological experience drives early adoption, while market experience targets mass-market users?
- Leverage existing technological expertise to target early adopters and innovators, and leverage market expertise to appeal to the broader, less intensive user base. Evidence: Organization Science (2020).
- Why does "Pre-entry technological experience drives early adoption, while market experience targets mass-market users." matter for design?
- Understanding the nuances of pre-entry experience allows design and product development teams to strategically position new technologies. This insight is crucial for forecasting market reception and tailoring product roadmaps to specific user groups, ultimately influencing market penetration and adoption rates.
- How can designers apply this research?
- Leverage existing technological expertise to target early adopters and innovators, and leverage market expertise to appeal to the broader, less intensive user base.
- What were the main findings?
- Pre-entry technological experience is associated with attracting intensive users, particularly when entering the market early.. Pre-entry market experience is associated with attracting lighter users, aligning with mass-market adoption.
- What research method was used?
- Empirical analysis of historical market data.
- How strong is the evidence?
- Evidence strength is rated Strong effect, based on a 2020 journal from Organization Science.
- What should I do differently in my next project?
- Before launching a new product, assess the company's technological and market experience. If targeting early adopters, emphasize technological depth. If targeting the mass market, emphasize market understanding and user-friendliness.
- What are the limitations?
- The findings are specific to the 2G mobile telephony market and may not directly translate to all technology sectors or market conditions.