Marketing Consumer Durables in Mature Product Categories - Do Innovators Matter?

Abstract:     
Sales in consumer durable goods categories are dominated by repeat purchases. Managers are particularly interested to know: Which consumers can be encouraged to make earlier repeat purchases? When are they likely to purchase? What factors drive their purchases? We, the authors, make three contributions towards answering these questions. First, we explore whether consumer innovativeness, a crucial driver of first purchase adoptions, also influences repeat purchases. Second, we argue that it is important to examine the differential impact of purchase factors between replacements forced by failure and discretionary replacements of working units. Third, we empirically explore additional unit purchases at a household level for the first time. In order to address these questions, we apply a competing risks hazard approach to information we gathered from a survey of the purchase behavior of 8,077 households for six durable products. We find that consumer innovativeness is a strong driver for the timing of both discretionary replacements and additional purchases, but not for forced replacements. We show the strength of this effect varies between products and household types. Overall, our results indicate that durable goods managers should pay special attention to innovative consumers when marketing to repeat buyers. We also find evidence of strong asymmetric effects of household characteristics between forced and discretionary purchases. For example, income acts to accelerate discretionary replacements, but leads to longer forced replacement times.

Number of Pages in PDF File: 41

Keywords: Diffusion of Innovation, Replacement Purchases, Consumer Innovativeness, Consumer Durables, Hazard Analyses

JEL Classification: M31

working papers series