Hey All,
I was private messaged about this question, so I'm here to do my best with it. I've seen it before, but it's never been one of my favorites. Anyone know where it's from (maybe it's
MGMAT!). Let's take a look:
The pace of new technology brings a constant stream of new devices to the market and many of them enjoy commercial success. But analysts warn that announcing new technology too soon after the introduction of a successful device can backfire: consumers may resent feeling pressured to spend money to replace a device they have just purchased, even if the new technology is clearly superior. The result is that consumers either do not buy the old device in anticipation of the new one, or they do not buy t he new device out of resentment over having already spent their money on the old one. So if a company wishes to introduce a new device, it should wait until purchases of the old device have begun to decline.
Conclusion: If introducing a new device, don't ANNOUNCE until old device purchases down.
Premise: Consumers don't want to buy new tech soon after old tech. This means they don't buy old tech if they know new tech is coming.
We want to strengthen this argument.
a· New technology often becomes less expensive after an initial surge in sales.
PROBLEM: We don't actually care about the amount of money made, only all the sales.
b. Media outlets such as television and magazines often report on the planned introduction of new devices while sales of old devices are still strong.
ANSWER: If media outlets report new devices even while sales of old devices are strong, then announcing it is super dangerous, because word will get out and people will stop buying the old product. Best not to announce until old sales have gone down, because then the coverage won't hurt the old device sales.
c· Consumers are usually able to determine whether new technology is superior to current technology.
PROBLEM: The issue isn't about what's better, just newer.
d· Surveys have shown that consumers prefer to make only one or two technology purchases per year.
PROBLEM: This strengthens the idea of not releasing technology too often, not the notion that one should wait to announce something until old sales are down.
e· Consumers tend to be loyal to technology companies whose products they enjoy using.
PROBLEM: This has nothing to do with loyalty at all. The question is if people will keep buying new products from the same company if they know that something better is coming.
Hope that helps!
-tommy