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From course:

Industrial Strategy 2022

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Question:

What are the demand side determinants of diffusion?

Author: Hjalmer Pedersen



Answer:

1. Market awareness – better promotion (especially ‘push’ campaigns) speeds up diffusion. 2. Network effects – diffusion increases as more people adopting the innovation makes it more desirable (e.g. Facebook). 3. Customer propensity to adopt – targeting to the early adopters (often younger and wealthier consumers) speeds up diffusion by creating a bandwagon effect.


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