Does Customer Engagement with Internet Based Services Influence Adoption of Other New Products?

By White, Darin W; Harrison, Joe C; Turner, Sam | Canadian Journal of Administrative Sciences, March 2010 | Go to article overview

Does Customer Engagement with Internet Based Services Influence Adoption of Other New Products?


White, Darin W; Harrison, Joe C; Turner, Sam, Canadian Journal of Administrative Sciences


Abstract

The impact of the Internet on how and when individuals decide to adopt new products and services remains a critical yet under examined topic. This research examines the linkage between Internet use and the new product diffusion process through the examination of a very large, detailed, Internet usage dataset. Our 12-month longitudinal analysis of 34,731 customers' Internet related behaviours indicates that the introduction of Internet based services is positively correlated with expedited adoption behaviour. Customers that utilized a company's Internet related service innovations were over twice as likely to adopt the company's new product offering during the first year of introduction. We conclude by discussing the implications and need for additional research.

Copyright © 2010 ASAC. Published by John Wiley & Sons, Ltd.

JEL Classifications: M30, L86

Keywords: technology-based services, product diffusion, electronic bill payment and presentment (EBPP), age-in-computing, E-SERVQUAL

Résumé

L'Internet influence-t-il quand et comment les personnes décident d'adopter de nouveaux produits et services ? Cette question, quoiqu' importante, est loin d'avoir fait l'objet de recherches approfondies. Le présent article examine, grâce à une très grande base de données détaillées sur l'usage de l'Internet, la corrélation entre l'utilisation de l'Internet et le processus de diffusion de nouveaux produits. Douze mois d'analyses longitudinales du comportement de 34 731 clients indiquent que l'introduction de services par internet est positivement reliée à une conduite d'adoption accélérée. Les clients qui utilisent les services Internet d'une compagnie sont plus de deux fois plus enclins à adopter l'offre d'un nouveau produit de cette compagnie pendant la première année de son lancement. Nous concluons en examinant les implications de l'étude et en proposant des pistes pour des recherches futures. Copyright © 2010 ASAC. Published by John Wiley & Sons, Ltd.

Mots clés : services basés sur la technologie, diffusion des produits, paiement des factures par voie électronique (EBPP), age-in-computing, E-SERVQUAL

The power of the Internet to help businesses establish a relationship with customers has become increasingly strong and one that must not be overlooked in their marketing strategies (Bakos, 1997). Companies are recognizing the importance of using "clicks and mortar" to bridge the physical and virtual worlds (Georgia, 2001). E-commerce is estimated to have generated over $25 billion in revenue in 2009, experiencing an annual growth rate of more than 11% - the fastest growing form of retail sales in the US (Laudon & Laudon, 2010). It is estimated for 2010 that over 60 million US businesses will have Internet registered sites with over 138 million Americans shopping online, and 34 million Americans researching a product daily, which will account for over 10 billion web searches each month (Laudon & Laudon). The Internet has been identified as a key enabler in customer interaction (Rayport & Sviokla, 1995). Indeed, the Internet is now recognized by most business leaders as the ultimate tool in relationship marketing (Zineldin, 1998).

A growing body of academic literature is beginning to show that the Internet has dramatic and positive effects on customers in myriad ways. Early studies of Internet markets took a simplistic view of consumers as simply searchers for low cost transactions (Strader & Hendrickson, 2001). More recently, researchers have begun focusing on the complex psychological and sociological effects of the Internet on customer satisfaction (Ding, Verma, & Iqbal, 2007) and brand loyalty (Cristobal, Flavian, & Guinaliu, 2007). Such research is in its infancy and presents researchers with more questions than answers. With many questions about how technology-based services influence customer behaviour still unanswered, additional study is warranted. …

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