The Impact of Communication Strategy on Launching New

Products: The Moderating Role of Product Innovativeness

Yikuan Lee and Gina Colarelli OConnor
Academic literature is lled with debate on whether product innovativeness
positively impacts new product performance (NPP) because of increasing competi-
tive advantage or negatively impacts performance due to consumers fears of novel
technology and resultant resistance to adopt. This study investigates this issue by
modeling product innovativeness as a moderator that inuences the relationship
between communication strategy and new product performance. The authors
emphasize that the impact of innovativeness to producers is different from that to
consumers and that the differences have strategic impact when commercializing
highly innovative products. Product innovativeness is conceptualized as multi-
dimensional, and each dimension is tested separately. Four dimensions of
innovativeness are exploredproduct newness to the rm, market newness to the
rm, product superiority to the customer, and adoption difculty for the customer.
In this study, communication strategy is comprised of preannouncement strategy
and advertising strategy. First, the relationship between whether or not a pre-
announcement is offered and NPP is explored. Then three types of preannounce-
ment messages (customer education, anticipation creation, and market preemp-
tion) are investigated. Advertising strategy is characterized by whether the
advertisement campaign at the time of launch was based primarily on emotional or
functional appeals.
Using empirical results from 284 surveys of product managers, the authors nd
that the relationship between communication strategy and NPP is moderated by
innovativeness, and that the relationships differ not only by degree but also by type
of innovativeness. Implications for research and practice are discussed.
Introduction
S
ince the late 1980s, the issue of identifying
factors that account for new product success
and failure has drawn substantial attention.
Among those many factors, product innovativeness is
one of the most important. There are two streams of
literature that examine the relationship between a
products innovativeness and its market performance:
the new product performance literature (NPP) [19,26,
42,57,70], and the launch strategy literature [8,30,
38,79]. The evidence, however, is not conclusive. Some
of the work argues that product innovativeness
positively impacts new product performance (NPP)
because it increases a rms competitive advantage
[11,26], which in turn creates additional incentives for
rms to invest in innovations and increase product
innovativeness as they attempt to compete in high-
tech markets.
Other studies indicate that innovativeness nega-
tively impacts performance because of customers
fears associated with adopting unproven technology.
Address correspondence to Yikuan Lee, Department of Marketing
and Supply Chain Management, The Eli Broad Graduate School of
Business (NBC), Michigan State University, East Lansing, MI 48824.
Phone: 517 353-6381; E-mail: leeyik@msu.edu.
J PROD INNOV MANAG 2003;20:421
r 2003 Product Development & Management Association
These studies emphasize the negative effects that
increased product innovativeness may have on the
uncertainty that consumers experience (i.e., high
switching costs, high risk, and increased investment
of time to learn new behaviors) with highly innovative
products [49]. Technological fear is an essential issue
for commercialization of high-tech products [34].
Some consumers deal with the fear of uncertainty
and new learning requirements of the new innovative
products simply by avoiding or hesitating in pur-
chases of the new and improved version [21].
Finally, Cooper and Brentani (1991) propose that
the relationship between product innovativeness
and commercial success is U-shaped [18]. According
to this view, products exhibiting either high or
low degrees of innovativeness are likely to be more
successful than those in-between. The authors explain
that highly innovative products should create more
opportunities for differentiation and competitive
advantage and hence impact positively on perfor-
mance. Conversely, less innovative products are more
familiar, less uncertain, may have higher synergy, and
thus are likely to enjoy a higher success rate.
Closing the Gap
We believe there are at least two reasons for these
inconclusive results. First, we believe that product
innovativeness as a construct is not dened clearly
and unambiguously. What is perceived as offering a
clearly superior set of features by the producer in fact
may be perceived as a highly risky alternative to the
consumer, who must deal with higher levels of
technical uncertainty than comfortable with. Directly
relating innovativeness to performance without
clearly identifying different dimensions (both the
bright side and the dark side) of innovativeness can
cause invalid interpretation of the results.
A second reason for the inconclusive results that
surround the role of innovativeness, we believe, is that
it has been treated typically as an independent
variable that directly impacts NPP. It may be that
innovativeness is modeled more appropriately as a
moderator between launch strategy variables and
performance. Innovativeness itself does not guarantee
success. A successful innovation must be novel and, at
the same time, easy to comprehend [26]. Without an
appropriate introduction strategy, a products inno-
vativeness may be perceived by customers as offering
uncertainty and risk rather than as providing superior
benets. This negative perception of innovativeness
may lead to adoption resistance. For example, Philips
introduced its digital compact cassette (DCC) tech-
nology and attempted to replace existing recordable
tape technology (cassette tapes). The company has
been unable to persuade consumers to switch from
existing analog cassette tapes to its DCC system.
Philips failure might in part be attributed to its poor
product launch advertising strategy, which failed to
emphasize the issue of backward compatibility and
did nothing to dispel consumers confusion over the
benets of digital recording technology [35]. Com-
munication with customers to manage their percep-
tions of product innovativeness is critically important,
especially when launching a highly innovative pro-
duct that customers may reject due to lack of product
knowledge.
It is conceivable that the mechanisms used to
successfully prepare the market for a new product
introduction would be highly different depending on
the characteristics of the product. Therefore, in this
article, we do not look at innovativeness as an
independent variable that directly impacts new
product success but rather as a variable that
moderates the relationship between communication
strategies and NPP. Modeling innovativeness as a
moderator, we believe, has more managerial meaning
because the conceptual framework illustrates how to
communicate with customers under different condi-
tions of innovativeness.
BIOGRAPHICAL SKETCH
Dr. Yikuan Lee is visiting assistant professor in the marketing &
supply chain department at Michigan State University. Her
research interests include commercializing innovative products,
high-tech marketing, network effects, new product development,
and knowledge management in strategic alliances. She received the
Best Dissertation Award and the Best Paper Award at the 1999
Product Development and Management Association (PDMA)
International Conference. She also won the Edl and Edith Darger
Dissertation Prize in Management in recognition of outstanding
academic achievement and promise for a successful career in 2000.
Dr. Gina OConnor is assistant professor in the Lally School of
Management and Technology at Rensselaer Polytechnic Institute
(RPI). Her elds of interest include new product development and
radical innovation. Before joining RPI in February 1988, Dr.
OConnor earned her Ph.D. in marketing and corporate strategy at
New York University. Prior to that time, she spent several years
with McDonnell Douglas and Monsanto Chemical. The majority of
her research efforts focus on how rms link advanced technology
development to market opportunities. She has authored many
academic articles on the topic and is coauthor of the book Radical
Innovation: How Mature Companies Can Outsmart Upstarts,
published by Harvard Business School Press (2000).
THE IMPACT OF COMMUNICATION STRATEGY J PROD INNOV MANAG
2003;20:421
5
Objectives of the Article
In the literature, product innovativeness is typically
measured based on its impact on the producer [25].
The focus of most of this work investigates the impact
of technological newness on the new product devel-
opment process [32,40,44,45,70,71,78]. These studies,
however, focus on the part of the new product
development process that occurs prior to launch. In
this study, we are interested in the role of innovative-
ness in commercializing a new product rather than on
the internal product development process. A new
product may be unique and superior to competitive
offerings due to a nely tuned stage-gate product
development process but may still fail due to a poor
launch [15]. The type of launch strategy employed is
one of the key determinants of new product success.
Although many academic scholars have focused on
identifying the most successful launch strategies
[3,8,38,73,79], we believe that the relationship among
launch strategy, product innovativeness, and NPP is
not understood fully yet. This research question
requires that we consider innovativeness along
dimensions that are perceived by and impact both
producers and consumers when introducing a product
to the marketplace.
There are two goals of this study. The rst is to
model the communication mix factors that would
inuence consumers perceptions of product innova-
tiveness and to relate those to NPP. A rms
communication strategy is a critical element of its
launch planthe element most directly responsible
for aiding the markets acceptance of a new product.
We then model the products innovation character-
istics as moderators of this relationship. We select two
commonly accepted elements of a communication
strategypreannouncement strategy and advertising
strategyand investigate how to communicate with
customers under various conditions of innovative-
ness.
There are several reasons for choosing these
two particular communication strategies. First, a lack
of product knowledge causes a need for customers to
be educated before the innovative product is intro-
duced to the market. Preannouncement not only
can preempt the market against competitors but
also can be used as a tool to familiarize potential
customers with the new product concept and can help
shape their expectations. Second, advertising strategy
plays an essential role throughout the purchasing
decision process. Empirical results from previous
studies indicate that the magnitude of advertising
expenditures (or advertising effort) signicantly im-
pacts NPP [20,70]. Beyond the level of expenditures,
the content of the advertising message is critical to
help ease customer anxiety about new technologies.
A second goal of this study is to clarify several
dimensions of innovativeness. While many studies
have addressed the role of a products innovativeness
as a substantial differentiating factor in managing in
new product development and launch, there has not
yet been a clear, systematic articulation of this
concept [22]. Recent conceptual work offers a
thoughtful taxonomy of types of innovativeness [25].
However, there is as yet little empirical testing of
separate measures of these concepts and their
differential effects in managerial contexts. By clarify-
ing multiple perspectives on this issue and by
measuring them separately, we highlight the impor-
tance of treating the denition of innovativeness
carefully and completely for strategic and managerial
decision-making purposes.
This article is organized as follows. The rst
section discusses the differences in the meaning of
innovativeness to producers and to consumers. Four
dimensions of innovativeness are identied. The
second section presents the conceptual model that
illustrates the impact of two types of communication
strategies on product performance, each moderated
by various dimensions of innovativeness. Several
hypotheses are developed, and the relationships
between those hypotheses and previous literature also
are discussed. The next section describes the metho-
dology, including the sample, data collection proce-
dures, and measure development. The last section
presents the empirical results and the managerial
implications. We close with conclusions and some
thoughts about the limitations of this study.
Multiple Dimensions of Innovativeness
Several empirical studies have investigated successful
launch strategies under varying levels of innovative-
ness [8,38,79]. The denitions of innovativeness,
however, are not standard, making interpretation of
research results somewhat difcult [23,25]. First, the
concept has been operationalized at different levels of
analyses: the industry, the rm, and the product level.
Second, it has been measured from a variety of
perspectives, including the rm as developer, the rm
as an adopter, and consumers as adopters. These
6 J PROD INNOV MANAG
2003;20:421
Y. LEE AND G.C. OCONNOR
various combinations have led to at least the
following sets of measures of innovativeness: the
extent to which a product impacts an industrys
competitive structure [74]; the extent to which a
product impacts the relative advantage of a rm
among its rivals [1]; the extent to which developing an
innovation causes the rm to move into arenas of
technological and market uncertainty [8]; the extent
to which the product offers new to the world benets
[10]; and the extent to which an innovation impacts
established customer behavior patterns, consumption
requirements, and expectations [49,58,77].
The literature on launch strategy measures innova-
tiveness primarily based on product newness to the
rm and affords much less attention to the impact of
product newness on consumption behaviors. The impact
of innovativeness on consumption behaviors depends
on how customers perceive the new product. Surpris-
ingly, few authors measure innovativeness by con-
sidering the potential impact on consumers
purchasing and consumption behavior when discuss-
ing the relationship between innovativeness and
launch strategies. Mick and Fourniers work (1998)
is an exception in that they have begun to identify the
issues conceptually [49]. Sethi et al. (2001) measured
new product innovativeness based on whether the
novelty of the product is appropriate from the
perspective of the marketplace [67]. To date, however,
no specic empirical data on the impact of this
phenomenon on product performance has been
reported. Following from this, none of the launch
strategy studies focus on the nature of the commu-
nication messages for effective management of
customers perceptions of product innovativeness.
We suggest that in order to investigate the relation-
ship between innovativeness and product introduc-
tion, the following two questions must be considered:
(1) What is the impact of innovativeness on produ-
cers? and (2) How might innovativeness impact on
consumption behaviors via consumer perceptions?
The meaning of innovativeness to producers may be
very different from that to the consumers, and
therefore impacts differently on the relationship
between launch strategy and NPP. The differences
have strategic meaning when launching a new
product.
The impact of innovativeness on producers. The
impact of innovativeness on producers is apparent
during both the development process and the
products launch. If the new product relies on
technology never previously used in the industry,
then product innovativeness will inuence develop-
ment activities such as idea development and screen-
ing, technical development, and strategic planning.
Conventional wisdom suggests that highly innovative
products should benet more than less innovative
products from procient execution of technical
development activities [69]. Some studies suggest that
the interaction between research and development
(R&D) and marketing should be emphasized espe-
cially when innovativeness is high [32,71]. Iansiti
(1995) proposes that technology integration is critical
to the introduction of new technologies because it
provides a mechanism for the accumulation of system
level knowledge of product and process and for its
convergence into the integration of technologies for
the next generation [40].
However, if the products novelty lies primarily in
the extent to which it causes new markets to develop
but the technical uncertainty is relatively low, then the
impact of innovativeness on the producer is more
intense during the commercialization stage than in the
development stage. If the product is a really new
producta radical innovation that creates a line of
business that is new not only for the rm but also for
the marketplacethen the level of innovativeness
also will impact on the types of activities required to
learn about new markets [21,53]. New communication
strategies, new distribution channels, and new custo-
mer development approaches may be needed in order
to introduce the new product to unfamiliar markets,
and entirely new skills sets may be required to create
new market spaces.
The impact of innovativeness on consumers. The
meaning of innovativeness to consumers is very
different from that to producers [49,77]. A product
that requires technology that is new to the rm
necessarily may not be unfamiliar to the marketplace;
indeed the rm simply may be expanding its own
competency base into competitive territory. The
resultant product may not be very innovative as far
as the market is concerned. For example, the radical
innovation of substituting the vacuum tube with the
transistor is a technological breakthrough for the
radio market, but it requires little from consumers in
terms of usage pattern changes or new learning. Yet
another example is the recent set of technological
breakthroughs in new materials to speed the proces-
sing capabilities of computer chips (from silicon to
gallium arsenide to silicon germanium). From the
consumers perspective, this innovation has little
impact on their adoption and use patterns; these are
THE IMPACT OF COMMUNICATION STRATEGY J PROD INNOV MANAG
2003;20:421
7
just subsequent generations of PCs that operate at a
higher speed. By comparison, the invention and
commercialization of the Internet has impacted
substantially consumers behavior and thus is per-
ceived as a radical innovation by consumers, although
the technology has existed and has been used for
several decades.
The impact of innovativeness on consumers
depends more on the degree of learning and adoption
efforts required of them rather than on the newness of
the technology itself [65]. A marketing innovation
necessarily does not need to be technically novel,
so long as customers perceive its offering as novel
[11]. If an innovation is perceived as very difcult
to adopt rather than as a unique product with
substantial new benets, the marketers challenge
is to work hard in communicating with customers
to translate the technical uncertainty into useful
benets. Appropriate communication strategies at
launch can reduce effectively the negative impact of
technical fears on the adoption of an innovative
product.
Conceptual Framework and Hypotheses
Figure 1 presents our conceptual framework. Two
communication tools, preannouncement strategy and
advertising strategy, directly impact on NPP. How-
ever, the relationship between communication strat-
egy, and NPP is moderated by four dimensions of
innovativeness: product newness to the rm; market
newness to the rm; product superiority to the
customer; and adoption difculty for the customer.
Preannouncement strategy is dened as a formal,
deliberate communication before a rm actually
introduces the new product into the market [24,63].
In this study, we posit that preannouncement has a
stronger positive impact on performance for highly
innovative products than for less innovative products
based on the following reasons. First, the benets of
preannouncing are tied to the advantages of being a
pioneer in the market. Empirical evidence suggests
many advantages of being rst to the market
[30,63,64,76,79]. Primary among those is that pre-
announcing helps the rm develop an initial level of
opinion leader support and favorable word of mouth
needed to accelerate the diffusion of the innovative
product [76].
Second, as a communication tool, preannounce-
ment strategy can reduce consumers risk perception
of an innovative product. From the consumers
perspective, high innovativeness may be related to
fear of unfamiliar product/technology functions,
substantial change of consumption patterns, and
concomitantly high switching costs [24,62]. Switching
costs may be a signicant impediment to consumer
adoption of a highly innovative product and may
favor current competitors by acting as a barrier to
new entrant [58]. Under conditions of high customer
switching costs, preannouncement may begin the
process of educating potential customers about how
New Product Performance

Market penetration rate

Market share
Profitability
Customer satisfaction
Market extension
Product newness to the firm
Market newness to the firm
Product superiority to the customer
Adoption difficulty to the customer
Competitive Intensity
Market Turbulence
Technology Turbulence
Preannouncement Strategy
Advertising Strategy
Product Innovativeness
Communication strategy
Market Environment
Figure 1: The Impact of Communication Strategy on Performance Moderated by Product Innovativeness
8 J PROD INNOV MANAG
2003;20:421
Y. LEE AND G.C. OCONNOR
to change over with minimum disruption and costs
[24].
Although there may be risks of preannouncement
(i.e., revealing intentions to competitors), these
conditions are less likely to be the case with highly
innovative products. The reason is that if the rm has
strong patent protection or owns its own distribution
system, it may be able to signal with less regard for
competitive cuing [33]. Therefore, we expect that
engaging in preannouncement activities will lead to
higher performance for highly innovative products
(that may be perceived as high risk and high switching
costs by the customers) than for less innovative
products.
H1: Preannouncing the new product will have a
stronger positive impact on NPP when innovativeness
is high than when it is low.
Advertising message strategy is a term used in this
study to convey the nature of the advertising appeal.
According to Petty and Cacioppos elaboration like-
lihood model (ELM), persuasion may take a central
and/or peripheral route [55]. In the central route, a
person engages in extensive cognitive elaboration (i.e.,
issue-relevant thinking) of the message. However, a
person may take the peripheral route if he or she is
not motivated or lacks the ability to process the issue-
relevant information. In the case of the peripheral
route, post-communication attitudes are based on
message cues that are irrelevant to forming a reasoned
opinion (e.g., ones liking of the endorser).
Building on the ELM, we identify two types of
advertising strategies based on the content of the
messages in the ad. Functional ads use rational
appeals to demonstrate a products attributes and
features in an objective manner and thus correspond
to the central route persuasion process. Emotional ads
(such as humor, slice-of-life, fear, or guilt appeals)
express the subjective and symbolic benets of the
product, thus incorporating the peripheral route.
Message appeals that are emotional, evaluative,
transformational, or feeling messages often are
contrasted with more rational, informational, factual,
or thinking appeals [36,47]. We believe that con-
sumers are more likely to process functional appeals
via the central route, while they are more likely to
process emotional appeals via a peripheral route.
Identifying these two types of advertising strategies
is important and strategic in the context of commu-
nicating with customers about highly innovative
products. In some cases, consumers may not have
the product knowledge to process the functional
appeals (e.g., information about technical details or
sophisticated product features). Under those condi-
tions emotional ads that evoke consumers positive
feelings about the product through peripheral routes
may be a more effective approach.
Traditionally, educating the market has been
emphasized heavily for introducing innovative pro-
ducts. Beard and Easingwood (1996) propose that
market education is a tactic that takes the most
generic approach to attacking the market and is most
appropriate when the market is unaware of the
existence of the technology [8]. With this tactic,
marketing resources are concentrated mostly on
educating potential customers about the novel tech-
nology and its possibilities [16]. The newer and more
innovative a product is, the more likely it is that
the public might not appreciate it at the beginn-
ing [66], and in this case, customers need to be taught
to recognize the differential benets of the novel
product [72].
However, are customers with little product knowl-
edge able to evaluate such technically oriented
information as is given in a functional ad? Studies
demonstrate that rational communications are more
effective for well-educated or analytical people than
for less educated or less analytical people [12,37].
Information about physical features may be mean-
ingless to consumers with little product knowledge.
Previous studies have proposed that the efciency of
functional appeals depends on the degree of con-
sumers product knowledge, (i.e., whether they are
experts or novices) [2,12,37]. Functional appeals are
likely to be effective for well-educated customers
because experts are able to infer all of the related
benets and thus nd technical description to be more
convincing. This is because experts are likely to
elaborate upon the message information by evaluat-
ing it in relation to their prior knowledge. Novices, on
the other hand, are likely to represent message
information more or less literally in memory or
feelings [17]. Because physical features may be mean-
ingless to novices, advertisements directed at novices
usually are structured around easily comprehended
benets [46].
Another concern of providing too much technical
information about novel products is that it may
induce the novice market to focus on what is not
known and thus may cause them to feel even greater
uncertainty. Prior research suggests that an unantici-
pated stimulus that violates existing cognitive struc-
THE IMPACT OF COMMUNICATION STRATEGY J PROD INNOV MANAG
2003;20:421
9
tures is likely to generate high uncertainty since
individuals are likely to imagine alternative possible
scenarios and to create possible alternative explana-
tions for the particular stimulus [75]. Cognitive
response approach theory posits that people tend to
evaluate persuasive information based on their
existing knowledge about the topic [31]. We extend
this nding and assume that for less innovative
products, cases wherein customers have a depth of
knowledge about the product, they are more likely to
take a cognitive response approach and to evaluate
rationally the functional appeals offered in an ad. For
highly innovative products, when customers have
little product knowledge, they are more likely to take
an affect-based attitude to process the emotional
appeals rather than nonunderstandable functional
information.
Finally, overemphasizing functional information,
such as technological superiority, may lead to
miscommunication with customers. A common error
in innovation-driven ventures is that the rm usually
concerns itself with improved technologies rather
than with improved customer benets [66]. The reality
is that customers buy benets, not technologies. Most
consumers are not drawn to an innovative product by
its technological sophistication [34]. Therefore, the
communication objective of a highly innovative
product is not to emphasize whether the new techno-
ogy is superior to existing technology or not. Instead,
a more effective communication objective is to
persuade the customers that the new technology
provides a bundle of benets to them, such that they
are eager to abandon the older technology.
H2: Emotional ads (compared to functional ads) will
have a stronger positive impact on NPP when
innovativeness is higher than when it is low.
Controls
Figure 1 also shows a set of control variables
accounted for in the model. Market environmental
variables are designed to control features of market
competition that might serve as potential confounds
or alternative explanations for our hypotheses about
the relationship between communication strategies
and NPP [61]. Three market environmental variables
are adopted from the literature: Market Turbulence,
Technology Turbulence, and Competitive Intensity
[41]. These control variables are irrelevant to our
theoretical focus on the impact of communication
strategy on performance and the characteristics of
product innovativeness. However, previous studies
have shown that these environmental variables may
inuence NPP [13,41,60], thus we control these
variables in the regression models
1
.
Method
Data Collection
Survey respondents were product managers or
marketing managers that have been responsible for
at least one new product launch within the three years
prior to data collection. By new product we mean an
end product with an independently developed launch
strategy (e.g., a major release in which there was a
major change in the functionality of the product), not
a component of a product or a maintenance release
version. The respondent was asked to complete the
survey with respect to the most recent product launch
in which he or she had been involved.
The American Marketing Association (AMA)
membership list was used, and 3,742 pretested surveys
were sent out to product managers in the U.S. and
Canada. Among those, 30.4 percent of the surveys
were returned as undeliverable due to inaccuracies in
the mailing list. Of the remaining list, 67.5 percent of
the respondents were disqualied since they were not
product managers or since they had not launched a
product within the past three years. We had requested
these criteria on the questionnaire. This left 847 as the
qualied sample frame. Of these, 284 responded for
an effective response of 33.5 percent from the
qualied list. Demographic and other indicators
(including industry type) were compared for earlier
and later respondents. These results showed no
signicant differences, providing support for a lack
of nonresponse bias. A subsample of nonrespondents
was contacted to understand their rationale for not
responding. The vast majority indicated that they did
not have time.
Measurement
We developed the measures of the constructs in
several stages. In the rst stage, survey items were
1
Due to the page limits and the theoretical focus of this study, the
results of the interaction effects across various short-term and long-
term performances are summarized in Table 6, Table 7, and Table 8
[7,9,68]. The complete results of the main effects of the independent
variables as well as the control variables are available in [43].
10 J PROD INNOV MANAG
2003;20:421
Y. LEE AND G.C. OCONNOR
generated either by borrowing directly from the
literature or through theoretical bases reected in
existing literature. In the second stage, a list of the
dened constructs and the measures were pretested on
ve academic experts. We asked the academic experts
to evaluate whether these measures were appropri-
ately representative of the constructs. In the third
stage, a focus group meeting was conducted for item
renement. In the meeting, ve product managers
were interviewed and were asked to comment on
the clarity and relevance of the measures. The items
were rened based on their comments. Finally, the
modied measures and constructs were pretested on
25 product managers. All the scales used in the pretest
were examined for reliability and unidimensionality
through the use of exploratory factor analysis. We
examined the item-to-total correlations for items in
each construct. We modied the measures by deleting
items with low correlations that did not represent an
additional domain of interest. The nal survey
contained measures of the key constructs and a set
of control variables. Tables 1 and 2 present the
measurement items for the key constructs, factor
loadings, and Cronbachs alpha coefcients. The
nalized items were subjected to maximum likelihood
factor analysis and were chosen based on high
loadings on a single factor with no signicant cross-
loadings.
Innovativeness. In the literature, innovativeness
typically is distinguished either by technology new-
ness and market newness [8,51] or by whether the
product is new to the rm or new to the world [10]. As
previously discussed, we believe there is a shortfall in
the literature dening innovativeness in that it does
not characterize explicitly and completely the full
dimensionality of innovation. The impact of product
innovativeness to the producers will be different from
that to the consumers, thus creating differences in the
effectiveness of launch strategies on performance. In
order to capture this effect, we specify these and
measure innovativeness along dimensions that are
important to producers and to consumers separately.
From the producers side, innovativeness refers to
the degree of newness of a product to the rm, in
Table 1. Factor Analysis of the Independent and Moderator Variables
Independent Variables Measure Items
Factor Loading
(Cronbachs a)*
Advertising strategy Functional Ad
1. Emphasized the technology superiority 0.682
2. Provided detailed information about product attributes 0.780
3. Emphasized the rms technology competence 0.710
4. Persuaded customers by functional appeals (e.g., quality, economy, value, etc.) 0.734
Emotional Ad (0.713)
1. Evoked customers positive feelings of using this product 0.872
2. Persuaded customers by emotional appeals (e.g., joy, humor, love, pride, etc.) 0.872
(0.538)*
Innovativeness:
1. Product newness to the a. This product is a repositioning of an existing product. 0.867
rm b. This product is an updated version of an existing product. 0.867
(0.522)*
2. Market newness to the rm a. The market this product was introduced into was new. 0.800
b. The competition faced was new. 0.779
c. The new distribution channels needed for this product were new. 0.717
(0.644)
3. Product superiority to the a. The technology this product incorporates was new to the customers. 0.803
customer b. The benets this product offers were new to the customers. 0.822
c. Customers perceived the product features as novel/unique. 0.810
d. This product introduced many completely new features to the market. 0.807
e. This product offers dramatic improvements in existing product features. 0.657
(0.840)
4. Adoption difculty to the a. The knowledge required to use this product was new to the customers. 0.838
customer b. Customers needed to learn how to use this new product. 0.901
c. Customer tended to resist adopting this new product. 0.734
d. Customers needed to change their behavior in order to adopt this product. 0.864
(0.857)
* Correlation coefcients are reported for two-item constructs.
THE IMPACT OF COMMUNICATION STRATEGY J PROD INNOV MANAG
2003;20:421
11
terms of the technology used [8,10,42,52,74,79], the
relationship of the new product to products typically
offered by the rm [25], and the degree to which
current markets are strayed from as targets for the
innovation [8,50]. To the extent that new markets or
undeveloped markets are targeted, new market
research methods, new distribution channels, and
new customer development approaches will be
required [8,10,52,53,74,79]. Based on the literature,
we identify product newness to the rm and market
newness to the rm as two dimensions of innovative-
ness from the producers perspective.
From the consumers side, product innovativeness
refers to the degree of novelty of the products
features/functionality/benets [4], degree of change
required in consumption behavior [4,6,77], and effort
required to learn to use and to adopt the new product
[6,49,77,78]. Answeaon (1988) considers the magni-
tude of the major change in the benets offered to the
consumers and the behavior change required to use
the product [4]. Similarly, Atuahene-Gima (1996)
refers to innovation newness as the degree to which
the new products usage patterns vary from current
customer consumption requirements and experiences
[6]. Veryzer (1998) investigates key factors affecting
customer evaluation of discontinuous new products.
He views product innovation as changes in three
dimensions. The consumption pattern dimension
refers to the degree of change required in the
thinking and behavior of the consumer in using the
product [77, p. 138].
Drawing from this literature, we distinguish the
impact of innovativeness on consumers into two
dimensions: product superiority to the customer and
adoption difculty to the customer. When facing a new
technology, consumers may experience a variety of
paradoxes [49]. Consumers simultaneously experience
both positive perceptions (innovativeness and opti-
mism) and negative perceptions (discomfort and
insecurity) regarding new technologies [54].
The innovativeness scales that resulted after
modication required by the pretest were four scales
that were derived from a set of 16 items that assessed
the newness associated with producers issues and
the newness associated with consumers issues.
Maximum likelihood factor analysis conrmed that
the Likert scale had four dimensions as we expected:
(1) product newness to the rm; (2) market newness
to the rm; (3) product superiority to the consumer;
and (4) adoption difculty to the consumer. The
details of the factor loading and Cronbachs alpha
coefcients are presented in Table 1.
Note that our respondents are product/brand/
marketing managers but not consumers. We believe
that based on their marketing research and interac-
tions with customers, managers have reliable data on
how customers perceive their products. Similar
measurement approaches have been used in previous
work. Andrews and Smith (1996) measured mean-
ingfulness of an innovation (referring to the extent to
which the marketing initiatives are thought to be
attractive or valuable to the consumers or retailers)
Table 2. Factor Analysis of the Control Variables
Control Variables Measure Items
Factor Loading
(Cronbachs a)
Competition Intensity 1. Number of competitors 0.716
2. The intensity of price competition 0.747
3. The competitive intensity in this industry 0.808
4. Strength of major competitors distribution system 0.725
5. Strength of major competitors distribution system 0.710
6. Strength of major competitors advertising 0.708
(0.833)
Market Turbulence 1. Degree of market turbulence that exists 0.736
2. Frequency of changes in customer preferences 0.826
3. Frequency of changes in customers needs 0.760
4. The extent to which the product life cycle shortens 0.642
(0.730)
Technology Turbulence 1. Degree of technology turbulence in the market 0.848
2. The extent of investment in technology development among competitors 0.823
3. Number of new technologies introduced in the market 0.900
4. Number of new product ideas make possible through technological breakthroughs
in our industry
0.848
(0.877)
12 J PROD INNOV MANAG
2003;20:421
Y. LEE AND G.C. OCONNOR
from consumer goods product managers [5]. Veryzer
(1998) investigated key factors affecting customers
evaluation of discontinuous new products based on
project managers self-reports [77]. Recent empirical
work has demonstrated that the judgment of the
project manager about new product innovativeness
reliably reects that of consumers [67]. The author
reported a signicantly positive correlation (r5.75,
Po.01) suggesting a reasonably high match between
the two groups. This result supports the use of
managers ratings of new product innovativeness as
reasonable measures.
Performance Measures. NPP is measured on
multiple dimensions adopted from literature
[19,20,27,29,38], summarized in Table 3. Respondents
were asked to evaluate their products performance
on 12 items on a ve-point Likert scale with 1 being
Far below Expectations and 5 being Far above
Expectations. Previous empirical work has demon-
strated that the importance or priority of perfor-
mance objectives varies by the stages of the product
life cycle (PLC) [39]. Thus each performance objective
is evaluated at two time frames
2
: the short term
during the introduction and growth phase of the
product life cycle, when sales volume is growing; and
the long termonce the product has reached the
mature phase of product life cycle, when sales have
leveled off.
The results of exploratory factor analysis on the
ve performance measures are presented in Table 4.
The factor loadings for each construct of short-term
performance measures are greater than .87 and the
Cronbachs alpha coefcients for the ve constructs
are greater than or equal to .725.
Advertising Strategy. Building on the ELM [55], we
identify two types of advertising strategies based on
the message appeal. Functional Ad refers to an
advertising strategy that uses rational appeals to
demonstrate the objective and functional product
attributes (utilitarian benets) of the product. This
type of ad is usually informational-, factual-, or
thinking-oriented [36,47]. Emotional Ad refers to an
advertising strategy that uses emotional appeals to
demonstrate the subjective and symbolic benets
(hedonic benets) of the product. Emotional ads are
usually more emotional-, evaluative-, transforma-
tional-, or feeling-oriented [36,47]. The results of
factor analysis on the measures of advertising strategy
are presented in Table 1.
Preannouncement Strategy. The preannouncement
strategy refers to the formal, deliberate communica-
tion a rm engages in before it actually introduces a
new product into the market [24,63]. The rationale
and benets of applying a preannouncement strategy
can be illustrated from two perspectivesone per-
taining to a competitive behavior signaling rationale
and the other to a consumer behavior signaling
rationale. A preannouncement signal directed at
competitors usually is sent with the purpose of
inuencing competitive behavior [63] in order to
strengthen the rst-mover advantage [24].
Preannouncements to customers, on the other
hand, are articulated to achieve very different
purposes. Preannouncing a new product with the
intent to educate the customer would be advanta-
geous if the product requires substantial learning and
usage pattern adaptation on the consumers part [24].
Preannoucements directed at consumers can be used
effectively not only to reassure customers and to
Table 3. Operational Denition of Dependent Variables
Variable Operational Denition Relevant Reference
General Market
Performance
Market share performance Protability performance
Customer satisfaction
[19,29,38]
Extension to New Market The extent to which the product opens a window of
opportunity on a new market for the rm.
[19]
Extension to New Product
Class
The extent to which the product opens a window of
opportunity on a new category of products for the rm.
[19]
Market Penetration Rate The ratio of volume of sales to the total potential market. [27]
2
In order to ensure that respondents were not hampered by history
bias, we required that the new product they were referring to in their
responses must have been launched within the last three years. Some
products had not yet reached the mature stage of the PLC. Thus, the
sample sizes for short-term and long-term performance regressions are
not equal. On average, the sample size of the long-term performance
regressions is only around 50 percent of the size for the short-term
measures.
THE IMPACT OF COMMUNICATION STRATEGY J PROD INNOV MANAG
2003;20:421
13
create a stable image for the company [59] but also to
encourage purchasing by creating anticipation of the
coming new product [48]. Building on previous
research, we identify three types of preannouncement
strategies based on the content of the message: market
preemption preannouncement, customer education pre-
announcement, and anticipation creation preannounce-
ment. The factor loadings and Cronbachs a are
presented in Table 5.
Results of Tests for Moderators
The main effect model tests the results of regressing
the changes in communication strategies on the
changes in NPP. The contingent model with interac-
tion terms examines the changes in the relationships
between communication strategy and performance
with the four dimensions of innovativeness
3
.
The results of the moderating role of innovative-
ness on the link between communication strategy and
performance are as follows.
Preannouncement Strategy
The rst conceptualization of innovativeness, product
newness to the rm, does not moderate the impact of
preannouncing (whether or not to preannounce) on
performance (see Table 6). When we look at the
dimension of innovativeness characterized by market
newness to the rm, preannouncing (compared to not
preannouncing) is associated with higher performance
on market penetration rate (b50.36, Po0.01), and
marginally better performance on short-term custo-
mer satisfaction (b50.30, Po0.10) and long-term
protability (b50.36, Po0.10). However, on two
dimensions of innovativeness associated with custo-
mers perception of innovativenessproduct super-
iority to the customer and adoption difculty for the
customerwe nd some counter-intuitive results: (1)
Preannouncing is associated with decreasing market
penetration rates as the degree of product superiority
increases (b50.27); and (2) Preannouncing is
associated negatively with short-term market exten-
sion (b50.28, Po0.10) and long-term protability
performance (b50.36, Po0.10) at marginally sig-
nicant levels.
These ndings are different from our expectation
that the more customers need to learn and change
Table 4. Factor Analysis of Dependent Variables
Factor Loading (Cronbachs a)*
Dependent Variables Measure Items Short term Long term
General Market Market Share-Related Performance
Performance 1. Market share performance 0.899 0.745
2. Volume sales performance 0.929 0.771
3. Rate of market penetration 0.922 0.763
(0.905) (0.868)
Protability-Related Performance
1. Net prots margin 0.918 0.893
2. Gross prots margin 0.934 0.906
3. Return on investment 0.870 0.794
(0.886) (0.911)
Customer Satisfaction-Related Performance
1. Customer satisfaction 0.908 0.895
2. Customer loyalty 0.908 0.905
(0.651)* (0.743)*
Market Extension-Related Performance
1. Extension into new markets 0.909 0.865
2. Extension into new product categories 0.909 0.900
(0.651)* (0.610)*
Market Penetration Rate 1. Market penetration rate compared to rm objective 0.886
2. Market penetration rate compared to major competitors 0.886
(0.575)*
* Correlation coefcients are reported for two-item constructs.
3
Due to space limitations and the purpose of this study, we present
the results of the coefcients of the interaction terms only. Main effect
results can be obtained from the rst author.
14 J PROD INNOV MANAG
2003;20:421
Y. LEE AND G.C. OCONNOR
their behavior to adopt the new product, the more
likely it is that customers will appreciate the
preannouncement. To further investigate these coun-
ter-intuitive results, we investigated the nature of the
message delivered to customers in the preannounce-
ment. Therefore, a set of contingent regression
models with the interaction terms of three types of
preannouncement objectives or messages is tested.
The three types of preannouncement objectives are
customer education, anticipation creation, and market
preemption.
Customer education refers to a message that
describes the functionality of the product and
creates a sense of familiarity with it. The focus of
the message is on the product and how to use it.
Anticipation creation refers to a message that builds
momentum and demand for the product by heighten-
ing expectations of it and encouraging people to talk
about it. Finally, market preemption refers to a
message whose objective is to discourage competitors
from entering the market. Results of the regressions
(see Table 7) indicate that preannouncements empha-
sizing customer education lead to higher performance
for products that are difcult to adopt. When the
product requires a lot of learning effort and behavior
changes for the customer, customer education-
oriented preannouncements are associated with
higher market penetration rates (b50.22, Po 0.01),
and marginally positively are associated with both
short-term market share (b50.20, Po0.10) and long-
term market share (b50.28, Po0.10) (Table 7). The
empirical results demonstrate that customers
respond more to educational preannouncements
over the other two types of preannouncement
when they face a product that is very difcult to
adopt.
Table 5. Factor Analysis of Preannouncement Strategy
Independent Variables Measure Items Factor Loading
(Cronbachs a)*
Preannouncement Strategy Content of the Preannounced Message
A. Customer Education
1. Educate the customers about this product 0.743
2. Make customers more familiar with this product 0.728
3. Make customers more comfortable with the incorporated technology 0.743
4. Reduce customers resistance to this product 0.814
5. Reduce customers risk perception of this product 0.775
(0.820)
B. Anticipation Creation
1. Encourage potential customers to talk about our products 0.770
2. Make sales accelerate more rapidly when you introduce the product 0.632
3. Increase customers expectations of our products introduction 0.765
4. Begin building customer awareness 0.675
(0.670)
C. Market Preemption
1. Discourage competitors from introducing this type of product 0.880
2. Make it difcult for competitors to enter successfully 0.880
(0.591)*
* Correlation coefcients are reported for two-item constructs.
Table 6. Results of the Tests of the Impact of Innovativeness (four dimensions) on the Relationship between
Preannouncement Strategy (whether preannounce or not) and Performance
The Impact of Innovativeness to the Producer
Product newness to the rm Market newness to the rm
market penetration rate (b50.36*** )
customer satisfaction (S) (b50.30* )
customer satisfaction (L) (b50.36*)
The Impact of Innovativeness to the Consumer
Product superiority to the customer Adoption difculty to the customer
market penetration rate (b50.27**) market extension (b50.28*)
protability (L) (b50.36*)
*po0.1
**po0.05
***po0.01
THE IMPACT OF COMMUNICATION STRATEGY J PROD INNOV MANAG
2003;20:421
15
On the other hand, a preannouncement message
that focuses on creating anticipation for the coming
new product leads to higher performance for products
that provide high superiority to customers. Highly
superior products are unique and have clear advan-
tages over other known products. Therefore, a high
anticipation-oriented preannouncement leads to mar-
ginally greater customer satisfaction (b50.26,
po0.10) for such unique products because, we would
theorize, their expectations ultimately are met.
The results also indicate that preannouncement
messages with the objective of market preemption are
not appropriate for products that are new to the rm.
Market preemption-oriented preannouncements are
associated negatively with market penetration rate
(b50.24, Po0.05) and short-term market share
(b50.26, Po0.01) for new-to-the-rm products.
Products that are new to the rm are not necessarily
very innovative or unique to the marketplace. A
possible explanation of this negative moderating
effect is that preannouncing may provide signals to
competitors who are already active in those product-
market arenas, giving them time to react. For new-to-
the-rm products, preannouncing with market pre-
emption messages does not create preemption ad-
vantage, and, on the contrary, may raise severe
reactions from incumbents. Moreover, market pre-
emption-oriented preannouncements are associated
with lower customer satisfaction performance for
both products introduced to unfamiliar markets
(b50.23, Po0.10, marginally signicant) and for
highly superior products (b50.23, Po0.01). The
insight of these ndings is that in considering
preannouncement message strategy, ghting against
competitors (a market preemption message) is a less
effective path to increased performance than is
pleasing customers (via customer education or
anticipation creation messages).
Advertising Strategy
The relationship between advertising strategy and
NPP is consistent for both measures of innovativeness
from the producers perspective: the degree of
product newness to the rm and the degree of market
newness to the rm. However, on the dimension of
innovativeness characterized by product superiority
to the customer, if the products are perceived as
unique, novel, or superior, functional ads are
associated with higher short-term protability
(b50.36, Po0.10) than are emotional ads. This result
is marginally signicant (Table 8).
On the contrary, however, adoption difculty to
the customer negatively moderates the relationship
between advertising strategy and NPP as measured by
extensions into new market segments. When the
product requires a lot learning effort or behavior
changes on the part of the customer, functional ads
may decrease market extension performance
(b50.65, Po0.01).
The impact of advertising strategy on NPP is
moderated by innovativeness only when we look at
the dimensions associated with innovativeness to the
Table 7. Results of the Tests of the Impact of Innovativeness (four dimensions) on the Relationship between
Preannouncement Strategy (the Nature of the Message Preannounced) and Performance
Preannounced Message
Product Newness
to the Firm
Market Newness
to the Firm
Product Superiority
to the Customer
Adoption Difculty
to the Customer
Customer Education Mkt Pen. Rate
(b50.22*** )
Mkt Share (S)
(b50.20* )
Mkt Share (L)
(b50.28* )
Anticipation Creation Cus. Sat. (L) (b50.26*)
Mkt Ext. (L) (b50.25* )
Market Preemption Mkt. Pen. Rate
(b50.24**)
Cus. Sat. (L)
(b50.23* )
Cus. Sat. (S)
(b50.23***)
Mkt. Share (S)
(b50.26***)
*po0.1
**po0.05
***po0.01
16 J PROD INNOV MANAG
2003;20:421
Y. LEE AND G.C. OCONNOR
customers but not when we look at the dimensions
associated with innovativeness to the rm. Advertis-
ing strategy that impacts on performance differs
depending on how customers perceive the innova-
tioneither as providing product superiority to the
customer or as highly difculty to adopt.
When the product has clear advantages over other
known products and has superior benets to custo-
mers, functional ads lead to higher performance.
However, if the product requires that customers learn
a lot or change their consumption behavior, then
emotional ads lead to higher performance. The
possible explanation is that functional ads emphasize
the features of the products and clearly communicate
how this product is superior over other previous
products. Emotional ads, on the other hand, focus on
how this product ts customers needs. Emotional ads
skip all the technical details and emphasize the
benets to the customers to evoke their positive
feelings for trying the new product. If a product is
very innovative in a way that customers need to learn
a lot and change their consumption patterns, then
functional ads focusing on technical details may not
be appropriate because customers do not have the
knowledge to evaluate such technical information.
Rather, emotional ads focusing on the benets of the
innovation are more attractive to customers if the
product is very difcult to adopt.
Conclusions and Managerial Implications
Summarizing the results of this research, there are
several interesting ndings that have academic con-
tributions as well as potential managerial implica-
tions. First, the relationships between each
communication strategy and each dimension of
performance differ not only by degree of innovative-
ness but also by the dimension of innovativeness. The
insight of this nding is that innovativeness needs to
be measured on multiple dimensions. Oversimplifying
or aggregating the measures of innovativeness may
estimate incorrectly the impact of innovativeness on
launching a new product.
These results indicate that the links between
communication strategies and various conditions of
innovativeness differ. With respect to preannounce-
ment strategy, when customers perceive that the
product will require a lot of learning effort, a
customer education-oriented message is the prean-
nouncement tool most tightly linked with positive
NPP. However, if the product is perceived by
customers as providing superior quality or utility,
then anticipation creation-oriented preannouncement
messages outperform the other two types of pre-
announcement message strategies.
With respect to advertising strategies during
launch, the positive impact of emotional ads on NPP
increases with the degree of the adoption difculty of
the product perceived by the customers. On the other
hand, the positive relationship between functional ads
and NPP will become stronger as the degree of
product superiority increases.
Second, the relationships between the communica-
tion strategies available to the product manager and
performance are moderated the most by the two
dimensions of innovativeness associated with custo-
mers: product superiority to the customer and
Table 8. Summary of the Results of the Moderating Role of Innovativeness on the Relationship between Advertising
Strategy and Performance
The Impact of Innovativeness to the Producer
The impact of advertising strategy to NPP is NOT moderated by innovativeness associated with the rm:
1. Product newness to the rm
2. Market newness to the rm
The Impact of Innovativeness to the Consumer
The impact of adverting strategy to NPP is moderated by innovativeness associated with consumers:
1. Product superiority to the customer (b50.36* ) - Functional ads lead to higher protability than do emotional
ads, if customers perceive the product as unique, novel, and
superior compared to existing offers.
2. Adoption difculty to the customer (b50.65** ) - Emotional ads lead to higher market extension performance
than do functional ads, when the product requires a lot of
learning efforts or behavior changes on the part of consumers.
* po0.1
** po0.05
*** po0.01
THE IMPACT OF COMMUNICATION STRATEGY J PROD INNOV MANAG
2003;20:421
17
adoption difculty for the customer. This nding
supports our argument that measuring innovativeness
by technological uncertainty and market uncertainty
alone or by the Booz, Allen, and Hamilton typology
[10] does not give enough information to examine the
impact of innovativeness on launch strategies. We
suggest that innovativeness needs to be measured with
the producer and consumer dimensionality clearly
specied because the meaning of the term differs for
each perspective.
Third, among the four dimensions of innovative-
ness, product newness to the rm does not have much
signicant impact on the relationship between launch
strategy and performance. Many previous studies
have measured innovativeness, at least in part, on this
dimension. Our results suggest that, at least where
launch strategies are concerned, misinterpretations of
the effects of innovativeness on launching new
products may result from measuring innovativeness
as newness to the rm.
Fourth, the interaction results of adoption dif-
culty for the customer are different from the
interaction effects of the other three dimensions of
innovativeness. The possible reason is that, different
from other three dimensions of innovativeness,
adoption difculty for the customer may be perceived
by customers as negative information, meaning high
risk, high uncertainty, and high switching costs.
Therefore, the communication strategies for products
with high adoption difculty differ from those for the
other three dimensions of innovative products. Again,
this nding supports our argument that innovative-
ness measures that do not incorporate consumers
perspectives are incomplete, because the consumption
behaviors may change depending on customers
perception of the innovativeness, and that change is
associated with the impact of communication strate-
gies on NPP.
Finally, some strategies may receive immediate
reactions from the market, while others have delay
effects. For example, a hostile signal with the intent to
preempt the market is more likely to garner im-
mediate reactions from competitors. The negative
effects of these strong competitive reactions may
cause a loss of market share and the reduction of
market penetration in the short term. However, it
may take a longer time for anticipation creation
preannouncement messages to be effective. Signaling
the product superiority or uniqueness to the con-
sumer with the intent to create a positive feeling for
the forthcoming new product may increase customer
satisfaction. This positive effect is signicant in the
long term but not in the short term, according to the
data reported here.
Potential Limitations and Future Research
Issues
Some researchers have expressed concern about the
potential bias of using single informants in data
collection [56]. Although our study uses a single
informant approach, we believe that this approach is
appropriate for several reasons. First, because our
research objective focuses on investigating various
types of communication strategies applied to each
new product, using product managers who are fully in
charge of the launch of the new product seems
warranted. These informants were selected carefully
for their unique expertise [14]. Second, Grifn (1993)
measured the reliability of single informants for most
new product development studies. The estimates
provided by individual informants are surprisingly
robustthey usually fall within ve10 percent of
each other (p. 120) [28].
A related limitation is that we measured the
impacts of innovativeness on consumers based on
the perceptions of product managers rather than by
directly surveying consumers. Any bias that product
managers might incorporate would, we expect,
weaken our results. Accounts from consumers, to
the extent that they vary at all, would cause our
results to be stronger than reported here. The effect of
the differences, however, has been shown in the
literature to be small enough so as not to affect the
outcomes of the analysis. Sethi (2001) demonstrates
that there are no signicant differences between the
judgment of the project manager about product
innovativeness and that of consumers [67].
It also should be noted that consumers percep-
tions of product innovativeness likely are affected by
many endogenous and exogenous factors, such as
personality, level of product knowledge, experiences
of similar products, pressure from social norms, and
other factors. These behavior-related issues fall out-
side the theoretical focus of this study. The major
purpose of this study is to investigate the most
appropriate or effective communication strategies
under different conditions of product innovativeness.
We are interested in the average or overall rating of
product innovativeness in the marketplace as a guide
for designing communication strategies for the new
18 J PROD INNOV MANAG
2003;20:421
Y. LEE AND G.C. OCONNOR
product. In this case, it is more effective to collect
data from product managers who have general ideas
(based on their marketing research and interactions
with customers) of whether customers like or dislike
the product than from the individual customer. An
important area for future research is the need to
measure product innovativeness perceptions in this
dyad fashion to understand where, why, and how big
the gaps are in perceptions between producers and
consumers with respect to innovativeness and how
this impacts management of new product launches.
As a nal limitation, the sample is not representa-
tive of the population of all businesses. Though the
sample covers multiple industries, the data is collected
based on a convenience sample of product/brand/
marketing managers that participate in the AMA.
The fact that we exclude potential respondents that
are not the members of AMA may affect the
generalizability of this study.
In this article we have demonstrated empirically
that the impact of communications strategy on NPP
is moderated by product innovativeness and that the
conceptualization and measurement of innovativeness
is critically important in determining appropriate
strategies for success. We have built on the emerging
work that is dening innovativeness conceptually
along these various dimensions, [25,49,77] and have
shown how important it is in academic relevance and
managerial practice.
References
1. Abernathy, W.J. and Clark, K.B. Innovation: mapping the winds
of creative destruction. Research Policy 14:322 (1985).
2. Alba, J.W. and Marmorstein, H. The effects of frequency
knowledge on consumer decision-making. Journal of Consumer
Research 14(June):1425 (1987).
3. Ali, A. and Krapfel Jr., R., et al., Product innovativeness and
entry strategy: impact on cycle time and break-even time. Journal
of Product Innovation Management 12:5469 (1995).
4. Anderson, R.L. and Ortinaa, D.J. Exploring consumers post-
adoption attitudes and use behaviors in monitoring the diffusion
of a technology-based discontinuous innovation. Journal of
Business Research 17:283298 (1988).
5. Andrews, J. and Smith, D.C. In search of the marketing
imagination: factors affecting the creativity of marketing programs
for mature products. Journal of Marketing Research 33(May):174
187 (1996).
6. Atuahene-Gima, K Differential potency of factors affecting
innovation performance in manufacturing and services rms in
Australia. Journal of Product Innovation Management 13:3552
(1996).
7. Baron, R.J. and Kenny, D.A. The moderator-mediator variable
distinction in social psychological research: conceptual, strategic,
and statistical considerations. Journal of Personality and Social
Psychology 51(6):11731182 (1986).
8. Beard, C. and Easingwood, C. New product launch: marketing
action and launch tactics for high-technology products. Journal of
Marketing Management 25(2):87103 (1996).
9. Becherer, R.C. and Maurer, J.G. The moderating effect of
environmental variables on the entrepreneurial and marketing
orientation of entrepreneur-led rms. Entrepreneurship Theory and
Practice 22(1), 4758 (1997).
10. Booz, A. and Hamilton, I. New Product Management for the
1980s. New York: Booz, Allen, and Hamilton, Inc., 1982.
11. Brown, R. Managing the S curves of innovation. Journal of
Consumer Marketing 9(1):6172 (1992).
12. Cacioppo, J.T. and Petty, R.E., et al. Effects of need for cognition
on message evaluation, recall, and persuasion. Journal of
Personality and Social Psychology 45:805818 (1983).
13. Calantone, R. and Schmidt, J.B., et al. New product activities and
performance: the moderating role of environmental hostility.
Journal of Product Innovation Management 14(3):179189 (1997).
14. Campbell, D.T. The informant in quantitative research. American
Journal of Sociology 60(January):339342 (1955).
15. Campbell, T. Back in focus. Sales and Marketing Management
151(2):5661 (1999).
16. Chandy, R. and Tellis, G.J. et al. What to say when: advertising
appeals in evolving markets. Marketing Science Institute working
paper #01-103 (2001).
17. Chi, M. and Feltovich, P.J. et al. Categorization and representa-
tion of physics problems by experts and novices. Cognitive Science
5(April):121152 (1981).
18. Cooper, R.G. and Brentani, U.D. New industrial nancial
services: what distinguishes the winners. Journal of Product
Innovation Management 8:7590 (1991).
19. Cooper, R.G. and Kleinschmidt, E.J. New product success factors:
a comparison of kills versus successes and failures. R&D
Management 20(1):4763 (1990).
20. Cooper, R.G. and Kleinschmidt, E.J. Determinants of timeliness
in product development. Journal of Product Innovation Manage-
ment 11:381396 (1994).
21. Dhebar, A. Speeding high-tech producer, meet the balking
consumer. Sloan Management Review 37(2):3749 (1996).
22. Dougherty, D Understanding new markets for new products.
Strategic Management Journal 11:5978 (1990).
23. Ehrnberg, E. On the denition and measurement of technological
discontinuities. Technovation 15(7):437452 (1995).
24. Eliashberg, J. and Robertson, T.S. New product preannouncing
behavior: a market signaling study. Journal of Marketing Research
24(August):282292 (1988).
25. Garcia, R. and Calantone, R. A critical look at technological
innovation typology and innovativeness terminology: a literature
review. Journal of Product Innovation Management Forthcoming
(2001).
26. Goldenberg, J. and Lehmann, D.R., et al. The idea itself and the
circumstances of its emergence as predictors of new product
success. Management Science 47(1):6984 (2001).
27. Golder, P.N. and Tellis, G.J. Will it ever y? Modeling the takeoff
of really new consumer durables. Marketing Science 16(3):256270
(1997).
28. Grifn, A. Merics for measuring product development cycle time.
Journal of Product Innovation Management 10(March):112125
(March).
29. Grifn, A. and Page, A.L. PDMA success measurement project:
recommended measures for product development success and
failure. Journal of Product Innovation Management 13:478496
(1996).
30. Green, S.G. and Gavin, M.B., et al.. Assessing a multidimensional
measure of radical technological innovation. IEEE Transactions on
Engineering Management 42(3):203213 (1995).
THE IMPACT OF COMMUNICATION STRATEGY J PROD INNOV MANAG
2003;20:421
19
31. Greenwald, A.G. Cognitive learning, cognitive response to
persuasion, and attitude change. In. Psychological Foundations of
Attitude. Ed. A.G. Greenwald, T.C. Brock and T.M. Ostrom. San
Diego, CA: Academic Press, 1983. pp., 148170.
32. Gupta, A.K. and Raj, S.P., et al. The R&D-marketing interface in
high-technology rms. Journal of Product Innovation Management
2:1224 (1988).
33. Heil, O. and Robertson, T.S. Toward a theory of competitive
market signaling: a research agenda. Strategic Management
Journal 12:403418 (1991).
34. Higgins, S.H. and Shanklin, W.L. Seeking mass market acceptance
for high-technology consumer products. Journal of Consumer
Marketing 9(1):514 (1992).
35. Hill, C.W.L Establishing a standard: competitive strategy and
technological standards in winner-take-all industries. Academy of
Management Executive 11(2):725 (1997).
36. Holbrook, M.B. and OShaughnessy, J. The role of emotion in
advertising. Psychology & Marketing 1(2):4564 (1984).
37. Hovland, C.L. and Janis, I.L. Communication and Persuasion:
Psychological Studies of Opinion Change. New Haven, CT: Yale
University Press, 1953.
38. Hultink, E.J. and Grifn, A., et al. Industrial new product launch
strategies and product development performance. Journal of
Product Innovation Management 14(4):243257 (1997).
39. Hultink, E.J. and Robben, H.S.J. Measuring new product success:
The difference that time perspective makes. Journal of Product
Innovation Management 12:392405 (1995).
40. Iansiti, M Technology development and integration: an empirical
study of the interaction between applied science and product
development. IEEE Transactions on Engineering Management
40(3):259269 (1995).
41. Jaworski, B.J. and Kohli, A.K. Market orientation: antecedents
and consequences. Journal of Marketing 57(July):5370 (1993).
42. Kleinschmidt, E.J. and Cooper, R.G. The impact of product
innovativeness on performance. Journal of Product Innovation
Management 8:240251 (1991).
43. Lee, Y. The Impact of Launch Strategy on New Product
Performance: The Moderating Roles of Network effects and
Innovativeness. Doctoral Thesis, Rensselaer Polytechnic Institute
(May 2000).
44. Leifer, R. and McDermoot, C.M., et al. Radical Innovation: How
Mature Companies Can Outsmart Upstarts. Boston: Harvard
Business School Press, 2000.
45. Leifer, R. and OConnor, G.C., et al. Implementing radical
innovation in mature rms: the role of hubs. Academy of
Management Executive 15(3):102113 (2001).
46. Maheswaran, D. and Sternthal, B. The effects of knowledge,
motivation, and type of message on ad processing and
product judgments. Journal of Consumer Research 17(June):
6673 (1990).
47. McGuire, W.J. The nature of attitudes and attitude change.
In. The Handbook of Social Psychology. Ed. G. Lindzey and
E. Aronson. Menlo Park, CA: Addison-Wesley, 1969. pp.,
136341.
48. McIntyre, S Market adaptation as a process in the product life
cycle of radical innovations and high-technology products. Journal
of Product Innovation Management 5:140149 (1988).
49. Mick, D.G. and Fournier, S. Paradoxes of technology: consumer
cognizance, emotions, and coping strategy. Journal of Consumer
Research 25(September):123143 (1998).
50. Moriarity, R.A. and Kosnik, T.J. High-tech concept, continuity,
and change. IEEE Engineering Management Review 3:2535
(1990).
51. Moriarity, R.T. and Kosnik, T.J. High-tech marketing: concepts,
continuity, and change. Sloan Management Review 30(4):
717 (1989).
52. Mueser, R Identifying technical innovations. IEEE Transactions
on Engineering Management 32(4):158176 (1985).
53. OConnor, G.C Market learning and radical innovation: a cross-
case comparison of eight radical innovation projects. Journal of
Product Innovation Management 15:151166 (1998).
54. Pasuranan, A Technology readiness index (TRI). Journal of
Service Research 2(4):307320 (2000).
55. Petty, R.E. and Cacioppo, J.T. The elaboration likelihood model
of persuasion. In. Advances in Experimental Social Psychology. Ed.
L. Berkowitz. New York: Academic Press, 1986.
56. Phillips, L.W Assessing measurement error in key information
responses: a methodological note on organizational analysis in
marketing. Journal of Marketing Research 18(November):395415
(1981).
57. Polk, R. and Plank, R.E., et al. Technical risk and new product
success: an empirical test in high-technology business markets.
Industrial Marketing Management 25:531543 (1996).
58. Porter, M.E. Competitive Strategy. New York: The Free Press,
1980.
59. Rabino, S. and Moore, T.E. Managing new-product announce-
ments in the computer industry. Industrial Marketing Management
18:3543 (1989).
60. Redmond, W.H. An ecological perspective on new product failure:
the effects of competitive overcrowding. Journal of Product
Innovation Management 12:200213 (1995).
61. Rindeisch, A. and Moorman, C. The acquisition and utilization
of information in new product alliance: a strength-of-ties
perspective. Journal of Marketing 65(April):118 (2001).
62. Robertson, T.S. The process of innovation and the diffusion of
innovation. Journal of Marketing 31(January):1419 (1967).
63. Robertson, T.S. and Eliashberg, J., et al. New product announce-
ment signals and incumbent reactions. Journal of Marketing
59(July):115 (1995).
64. Robinson, W.T. and Fornell, C. Sources of market pioneer
advantages in consumer goods industries. Journal of Marketing
Research 22(August):305317 (1985).
65. Rogers, E.M Diffusion of Innovations. New York: The Free Press
of Glencoe, 1995.
66. Ryans, J.K Marketing to nonexistent markets. High Tech
Marketing Review 1(1):815 (1987).
67. Sethi, R. and Smith, D.C., et al. Cross-functional product
development teams, creativity, and the innovativeness of new
consumer products. Journal of Marketing Research 38(Febru-
ary):7385 (2001).
68. Slater, S.F. and Narver, J.C. Does competitive environment
moderate the market orientation-performance relationship? Jour-
nal of Marketing 58(January):4655 (1994).
69. Song, S.M. and Montoya-Weiss, M. Critical development
activities for really new versus incremental products. Journal of
Product Innovation Management 15:124135 (1998).
70. Song, X.M. and Parry, M.E. The dimensions of industrial new
product success and failure in state enterprises in the Peoples
Republic of China. Journal of Product Innovation Management
11:105118 (1994).
71. Souder, W.E Managing relations between R&D and marketing in
new product development projects. Journal of Product Innovation
Management 6:619 (1988).
72. Srivastava, R.K Marketing technology intensive products to
industrial rms. High Tech Marketing Research 1(2):1121 (1987).
73. Traynor, K. and Traynor, S.C. Marketing approaches used by
high-tech rms. Industrial Marketing management 18:281287
(1989).
74. Tushman, M.L. and Anderson, P. Technological discontinuous
and organizational environments. Administrative Science Quar-
terly 31:439465 (1986).
20 J PROD INNOV MANAG
2003;20:421
Y. LEE AND G.C. OCONNOR
75. Tversky, A. and Kahneman, D. A heuristic for judging frequency
and probability. Cognitive Psychology 5:207232 (1973).
76. Urban, G.L. and Carter, T., et al. Market share rewards to
pioneering brands: an empirical analysis and strategic implica-
tions. Management Science 32(June):645659 (1986).
77. Veryzer, R.W. Jr Key factors affecting customer evaluation of
discontinuous new products. Journal of Product Innovation
Management 15:136150 (1998).
78. Veryzer, R.W. Discontinuous innovation and the new product
development process. Journal of Product Innovation Management
15(4):304321 (1998).
79. Yoon, E. and Lilien, G.L. New industrial product performance:
the effects of market characteristics and strategy. Journal of
Product Innovation Management 2(3):134144 (1985).
THE IMPACT OF COMMUNICATION STRATEGY J PROD INNOV MANAG
2003;20:421
21