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A Conjoint-Hazard Model of the Timing of Buyers' Upgrading to Improved Versions of High Technology Products

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  • Kim, Sang-Hoon

    (Seoul National U)

  • Srinivasan, V. Seenu

    (Stanford U)

Abstract

This paper presents a method to forecast the sales path of an improved version of a high technology product defined in terms of its price path and multiattribute product specification. The approach is potentially useful to managers to answer what if questions on the effects of alternative price paths and product specifications of the upgrade on when and how many of their customers will upgrade. The proposed approach integrates an individual-level conjoint utility model with a hazard function specification. An illustrative application to the personal digital assistant (PDA) category confirms the predictive validity and potential usefulness of the proposed approach. Among the empirical findings are that higher upgrade costs and expectation of faster product improvement tend to delay buyers' upgrading decisions.

Suggested Citation

  • Kim, Sang-Hoon & Srinivasan, V. Seenu, 2006. "A Conjoint-Hazard Model of the Timing of Buyers' Upgrading to Improved Versions of High Technology Products," Research Papers 1720r1, Stanford University, Graduate School of Business.
    • Handle: RePEc:ecl:stabus:1720r1
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    References listed on IDEAS

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    Cited by:

    1. Huh, Young Eun & Kim, Sang-Hoon, 2008. "Do early adopters upgrade early? Role of post-adoption behavior in the purchase of next-generation products," Journal of Business Research, Elsevier, vol. 61(1), pages 40-46, January.
    2. Karniouchina, Ekaterina V. & Moore, William L. & van der Rhee, Bo & Verma, Rohit, 2009. "Issues in the use of ratings-based versus choice-based conjoint analysis in operations management research," European Journal of Operational Research, Elsevier, vol. 197(1), pages 340-348, August.

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