The Psychology of New Product Adoption

likely to flourish than those that don't. However, businesses spend billions of dollars making better "mousetraps" only to find consumers rejecting them. Studies show that new products fail at the staggering rate of between 40% and 90%. In the US packaged goods industry, for example, companies introduce 30,000 new products every year, but 70% to 90% of them stay on store shelves for less than 12 months. According to one study, 47% of the start-up companies that pioneered new products later went out of business altogether. B Experts and novices alike tend to dismiss unsuccessful innovations as bad ideas that were destined to fail. But surely that's too simple an explanation. If these innovations were so misguided, why wasn't it obvious from the outset? Why don't consumers buy innovative products with distinct advantages over existing ones? To understand why new products fail we must delve into the psychology of behavior change. Companies have long assumed that they have only to develop innovations that are objectively superior to existing products, and consumers will have sufficient incentive to purchase them. In the 1960s, communications scholar Everett Rogers called the concept "relative advantage" and identified it as…