| Understanding the diffusion process of new products is a key factor in business success. Firms have been able to understand the adoption of their product at the individual level (micro) and the diffusion of their product at the aggregate level (macro), but they have not been able to link the two, thus leading to difficulties of demand estimation, which in turn has led to shortages in supply or oversupply as well as challenges to developing effective marketing strategies (e.g., pricing, branding). This study proposes a model of innovation diffusion, which emerges from individual level adoption decisions, and shows how the aggregate level properties of the diffusion of innovations are in fact the results of variations at the individual level. The study investigates, both domestically and internationally, the four different dimensions of social processes and how each of these social process dimensions plays a role in individual adoption decisions. By showing the differential effects of social process dimensions on adoption decisions, the study provides a more refined understanding of the interplay among innovation characteristics, individual heterogeneity, and aggregate adoption. |
