Seeing the Forest or the Trees? The Impact of Global and Local Processing Styles on Consumer Responses to New Products

• Applicant: Professor Dr. Daniel Wentzel
• Subject Area: Accounting and Finance
• Term: from 2014 to 2018
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 255461980

To gain a competitive advantage, companies spend billions of dollars on developing new products and launching them on the market. Despite these enormous investments, failure rates for new products are substantial. Against this background, a broad body of research has examined how consumers evaluate and adopt new products and how companies can increase the effectiveness of new product development. One limitation of this literature, however, is that is has not examined how consumer acceptance of new products is influenced by their psychological lens, that is, by the manner in which they mentally process information relating to new products. In this proposal, we develop a conceptual model that argues that consumers may process new products in a global manner (i.e., beginning with the overall configuration of a product and then working downward toward the details) or a local manner (i.e., beginning with the details of a product and then working up to a global configuration) and that these different processing styles may affect their evaluations. In particular, the conceptual model seeks to address three interrelated issues: (1) Existing research suggests that responses to a new product are affected by the extent to which consumers are able to access prior knowledge that is potentially relevant for understanding the product. However, it is unclear if and to what extent different processing styles may affect new product evaluation by facilitating or hindering the transfer of appropriate knowledge structures. (2) While consumers may be drawn to new products because of their innovative benefits, studies have also found that consumers often discard new products shortly after they have purchased them because they do not learn to use them properly. Hence, we seek to develop a better understanding of how consumers learn to use complex products and how different processing styles may affect this learning process. (3) Lastly, whereas existing studies on global and local processing may help to explain how consumers respond to new products, there is little research that can guide firms in implementing these findings in an applied context. Thus, we want to examine how firms can systematically trigger different processing styles in new product marketing. Given the breadth of the research program, we will test the effects of processing styles on consumer responses to new products through a range of different experimental methods. That is, we will not only conduct a number of laboratory studies where consumers will evaluate verbal descriptions of new products, but also aim to design a number of studies where we will ask consumers to engage with a new product prototype and will observe how they learn to use the features of the product. These studies may not only yield important theoretical insights, but may also show how firms can increase the effectiveness of new product launches by guiding consumer processing styles.

• DFG Programme: Research Grants
• International Connection: Switzerland
• Participating Person: Professor Dr. Gerald Häubl