Winning Back Consumers To An Abandoned Technology

New technologies can have teething problems such that some users give up the whole class of technology itself (and not just the brand). A case in point was 2G mobile internet services that used wireless application protocol (WAP). The performance was so unreliable that some consumers dubbed it “wait and pay” and stopped using 2G altogether. When the 3G version came along, service providers had to figure out how to lure back these consumers.

Researchers Xin Xu, James YL Thong and Kar Yan Tam have used the evolution from 2G to 3G mobile technology as a natural experiment to show information and communications technology (ICT) firms how to handle consumers who they call “disadopters” when unveiling a new generation of technology.

“Disadoption, though not often seen on a large scale in the later stages of technological evolution, is nevertheless recurrent at the early stage. These cases are often labelled ‘technology failures’. Prominent examples include the disadoption of Apple Newton, an early-generation personal digital assistant that was finally abandoned due to poor performance and poor value for money, and Microsoft Tablet PC, which was abandoned due to the incompatibility of its user interface and design with the mobile context of use.”

“Disadoption can have serious consequences for the particular vendor or even the whole industry because it can delay the diffusion of an entire category of ICT, thus affecting the growth of a whole industry sector or its ecosystem,” the authors said. For example, consumers’ disadoption of 2G services significantly delayed the proliferation of application developers, device manufacturers, content providers and other members of the mobile internet ecosystem.”

Despite these impacts, there has been scant research on winning back disadopters. The authors take on this challenge by focusing on consumers’ negative experiences with the older technology generation and the drivers that encourage them to readopt the new version.

For previous negative experiences, they looked at the time passed since disadoption, tenure of use of the old technology, and intensity of use. They conjecture that the longer the period since that experience, the more likely the customer may readopt the technology because it may have faded from memory. Longer and more intensive use of the old technology may also affect whether they want to readopt as they may have incorporated its use more deeply into their daily lives.

The drivers of readoption are the perceived superiority of the technology, effort expectancy in using it, social influence, and price value. Here, the reasons for trying out the technology in the first place matter. The authors determine that two types of consumers are most likely to disadopt. One is the consumer keen about innovation and early adoption, who places a higher premium on performance. The other is the “early majority” – those who care about the economic value of the technology as well as the social influence from other consumers.

These concepts were tested on a sample of 274 disadopters in Hong Kong, which was among the first cities in the world to introduce 3G technology. For the most part, the results showed that the interplay between consumer type, negative experiences with 2G, and drivers of readoption affected consumers’ intention to try out the new 3G technology.

“The duration of disadoption has a positive effect on readoption intention because accessibility of prior negative experience diminishes with elapsed time since disadoption. We also found a profound and positive impact of usage intensity. This may be because a higher usage intensity can indicate the earlier technology generation is previously highly integrated into the disadopter’s life, which increases the likelihood of readoption,” they said.

“Finally, we identified poor performance and low economic value as primary reasons for consumers’ technology disadoption. These can moderate the impacts of tenure, usage intensity, social influence, and price value.”

The authors suggested several strategies for winning back disadopters. One is to show that the new technology generation is better. “Our study shows that the superiority of the new technology generation as perceived by disadopters has the greatest impact on their readoption intention,” they said.

ICT service providers could also examine the usage history of disadopters to identify those with the highest likelihood of readoption. The providers should also take into account the perceived price value and social endorsement of their services, and they should segment disadopters into categories such as “price sensitive” and “performance oriented” to tailor marketing strategies to them.

THONG, James Y L

Michael Jebsen Professor of Business, Chair Professor
Information Systems, Business Statistics & Operations Management

TAM, Kar Yan

Dean of Business and Management, Chair Professor, Director of Tongyi Industrial Group Center for Electronic Commerce
Information Systems, Business Statistics & Operations Management