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Can brands reduce the level of consumer innovation resistance? : the moderating effect of brand innovativeness and brand credibility on the relationship between innovation type and active innovation resistance

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Master Thesis

MSc Business administration – Marketing Track Faculty of Economics and Business

University of Amsterdam

Can brands reduce the level of consumer innovation

resistance?

The moderating effect of brand innovativeness and brand credibility on the relationship

between innovation type and active innovation resistance

Name: Maud van den Broek Date: Thursday, 23 March 2017 Student number: 10370803 Supervisor: Frank Slisser

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Statement of Originality

This document is written by Student Maud van den Broek who declares to take full responsibility for the contents of this document.

I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it.

The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.

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Abstract

One of the causes of innovation failure is consumer resistance towards innovation. However, how this resistance can be overcome is still under-researched. Previous research suggests that brands can play an important role in innovations and can facilitate the innovation adoption. Many researches focuses upon the success of innovations and dive into the reasons to adopt an innovation, but do not dive deeper into the reasons that prevent innovation adoption. This research dives into this gap and investigates how brand innovativeness and brand credibility can influence the level of active

innovation resistance amongst consumers for two type of innovations; radical versus incremental. More specifically, the relation between innovation type and active innovation resistance was tested, as well as the moderating effect of brand innovativeness and brand credibility on this relationship. An experimental survey was conducted among 196 Dutch respondents. The results suggest that a radical innovation causes a statistical significant higher level of active innovation resistance than an incremental innovation. However, brand innovativeness and brand credibility did not moderate this relationship.

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Table of contents

_Toc478041295

1.

Introduction ... 6

Contributions ... 9

1.1

Managerial contribution ... 9

1.2

Theoretical contribution ... 10

2.

Literature review ... 11

2.1 Brands and innovations ... 11

2.2 Brand function in innovations ... 12

2.3 Introduction to consumer resistance towards innovation ... 13

2.4 Difference between consumers resistance and adoption ... 14

2.5 Innovation decision process ... 15

2.6 Resistance in consumer behavior ... 21

2.7 Barriers to adoption ... 23

2.8 Innovation types... 25

2.9 Branding an innovation ... 26

2.10 Brand innovativeness and brand credibility ... 28

3. Conceptual framework and integration ... 31

3.1 Hypotheses 1: effect of innovation type on active innovation resistance ... 31

3.2 Hypotheses 2: moderating effect of brand innovativeness ... 32

3.3 Hypotheses 3: moderating effect of brand credibility ... 33

4.

Research design ... 35

4.1

Research method ... 35

4.2

Measurement of variables ... 36

4.3

Experimental design ... 40

4.4

Limitations ... 43

5. Results ... 45

5.1

Sample characteristics ... 45

5.2

Distribution per condition ... 46

5.3

Validity and reliability ... 48

5.4

Manipulation check ... 48

5.5

Hypothesis testing ... 53

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6.1 Discussion of the results ... 60

6.2

Conclusion... 66

6.3

Limitations and future research ... 66

6.4

Theoretical and managerial contributions... 69

References ... 71

Appendix ... 78

Appendix 1: Innovation manipulations in pre-test... 78

Appendix 2: Brands used in pre-test ... 80

Appendix 3: Descriptives pre-test ... 81

Appendix 4: Hypotheses overview ... 82

Appendix 5: Survey ... 83

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1. Introduction

According to Gourville, (2006) most innovative products are unsuccessful. 70% to 90% of the 30.000 new introduced products every year in the packaged goods industry fail and even don’t remain on the shelves longer than twelve months. Highly innovative products that create new product categories are also often unsuccessful; 47% of those first mover products fail. Managers have to understand whether and why consumers will adopt a new product or service, in order to minimize failures (Arts, Frambach & Bijmolt, 2011). Most of the newly introduced products require a change in consumer’s behavior (Gourville, 2006; Laukkanen, Sinkkonen, Kivijarvi & Laukkanen, 2007). Those behavioral changes entail economic switching costs such as transaction costs or learning costs. But those costs are not the only aspects that have to be taken into account while introducing new products. Heidenrech and Kraemer (2015) suggest that there is a high failure rate of innovations because they are rejected by consumers due to their resistance to innovation. The greater the change the innovation entails, the greater the resistance amongst consumers (Laukkanen et al., 2007).

If an innovation has to deal with resistance from consumers, the final adoption only can begin after overcoming the resistance (Ram, 1989). Final adoption means that consumers make the decision to make full use of an innovation and this takes place at the end of the innovation decision process (Rogers, 2003). Innovation resistance is therefore not the contrary of innovation adoption, the final adoption only starts after overcoming the resistance (Ram, 1987). If the innovation resistance cannot be broken down, the adoption will decelerate and the innovation will fail. Innovation resistance may exist even when innovations are successful. There are many possible reasons as to why products fail. A lack of market orientation has been identified as the main issue, because the innovation will not be perceived as an innovation that meets consumers wants and needs (Ram, 1989). However,

consumers will resist the same innovation for different reasons, so it will have an effect on the innovation decision process of every particular consumer. This is why firms need to identify the different sources of consumer resistance to innovations, in order to minimize the failure of products (Ram, 1989).

One of those sources that can cause the resistance towards innovation, is a risk barrier (Ram & Sheth, 1989; Laukkannen et al., 2007). A risk barrier refers to the uncertainty and potential side

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effects of the innovation perceived by the consumer. Consumers therefore might try to postpone the innovation until they know more about it (Sheth & Ram, 1989). Innovations entail uncertainty and a degree of perceived risk for the consumer (Laukkanen et al., 2007). The level of perceived risk depends on the type and radicalness of the innovation (Ram, 1987). Small incremental innovations have lower levels of perceived risk for the consumer compared to large radical innovations, which disrupt the routine behavior, and are associated with higher levels of perceived risk (Ram, 1987). Furthermore, radical innovations are defined as innovations that break with traditions and can be named as discontinuous and breakthrough (Dahlin & Behrens, 2005). According to Ram and Sheth (1989), the more discontinuity of an innovation, the higher the resistance will be. On the other hand, a continuous innovation can also meet consumer resistance. Even though there may be little to no changes for the consumer, it can still conflict with their prior beliefs (Ram & Sheth, 1989). Therefore, the radicalness of an innovation is an important factor in researching consumer resistance.

There has been a lot of research on the different barriers that create consumer resistance, but there is more research needed about how resistance can be overcome (Bagozzi & Lee, 1999). Sheth and Ram (1989) mention a few solutions of how the risk barrier can be ripped. Three ways to overcome risk barriers are: offer the innovation on a trial basis to potential customers, elicit endorsements and testimonials from experts who objectively evaluate the innovation, and package the innovation under a well-known brand name (Seth & Ram, 1989). Meanwhile, there has not been researched on how this works, and to what extent these solutions can reduce the consumer resistance towards innovation. This paper will dive into this and will focus on the role of the brand in the innovation resistance. To be more specific, brands have the ability to reduce the risk for the consumer and set consumer expectations (Brexendorf et al., 2015). Branding influences the consumer response to innovation and its success in the market (Brexendorf et al., 2015). Previous research shows that brand strength can increase the probability that consumers test new products. Intrinsic and extrinsic factors of the brand have a proven impact on the adoption decision (Brexendorf et al., 2015).

The role of the brand as a strategic resource in innovation projects has only been superficially addressed in the literature (Nedergaard & Gyrd-Jones, 2013). There is a significant gap in the role of brand positioning in facilitating the innovation process. A lot of research is done one by one in the

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fields of new product development and brand development. The relationship between branding and innovation is still under-researched (Brexendorf, 2015). Branding has barely been referenced in the innovation literature and conversely. The neglecting linkages between branding and innovation result in a narrow perspective on factors that affect the success or failure of market introductions (Aaker, 1997; Calder and Calder, 2010; Hulting 2010 Kapferer, 2014). This will be further explained in the next chapter. Innovation is often driven by either consumer insights or technological development. Whereas brand-led innovation is miserably not very well understood (Nedergaard & Gyrd-Jones, 2013). Especially, to the best of my knowledge, there hasn’t been researching done on the role of the brand in consumers resistance towards innovation.

Brands are important in the judgment that consumers can make about the performance of

new products. Brands can play an important role in the valuation of innovations (Brexendorf et al., 2015). The adoption of innovative products is eased by the reputation and quality of the innovator (which contains characteristics of the brand) and helps to reduce the intrinsic risk of adoption. The intrinsic risk is also influenced by the radicalness of an innovation. The more discontinuity of an innovation, the higher the resistance will be. So, the brand can facilitate the final innovation adoption, but it is unknown whether the brand is able to reduce the resistance that precedes the final adoption. The brand is actually able to reduce the risk for the consumer while resistance towards an innovation, among other things, is caused by risk. A high failure rate of innovation is due to consumer’s resistance towards innovations; this degree of resistance is influenced by the level of radicalness. It is proven that a brand can have an impact on the adoption decision of consumers, but the final adoption only begins after overcoming the resistance. To conclude; there is a missing link in between those concepts. However, since a brand has many functions, two specific elements will be researched; brand credibility and brand innovativeness. Brand credibility has a positive impact on the acceptance of an new product. Brand innovativeness can provide credibility to new products and influences the acceptance of it. So those brand functions will be researched as the moderators on the relationship between innovation type and active innovation resistance.

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The research question that therefore will be addressed in this research is:

How do brand credibility and brand innovativeness influence the degree of active innovation resistance amongst consumers for incremental innovations compared to radical innovations?

Contributions

1.1 Managerial contribution

It is relevant to research the different concepts together. To be specific, a well-established brand has much meaning and set expectations for the consumer (Brexendorf et al, 2015). This meaning and these expectations are central in the brand positioning, and they support a strategic focus that will result in guidance to innovations. The strategic brand positioning will result in particular knowledge about the brand among consumers. Consumers will make decisions based on what they know, think, feel, and believe about the brand, and this will, therefore, have influence on the acceptation of the innovation. This consumer brand knowledge can encourage the introduction of innovations and increase the probability to make the grade. A successful innovation can encourage the meaning, expectations, perception, attitude and usage of the brand. All this updated knowledge together can have implications for the acceptance and development of following innovations (Brexendorf et al, 2015). However, it is still unknown whether this cycle will have an influence on the consumer resistance that precedes the final innovation adoption. Brands can play a role in adopting an innovation, but does it also influence the resistance towards innovation that precedes the final adoption? It is interesting to know whether and why consumers will resist or not resist an innovation, because it is one of the causes of the high failure rate of innovations (Cornescu & Adam, 2013). Also, if consumers don’t evaluate the potential of an innovation and thus reject it in advance, any

investment in later stages of the decision process are misspent (Kruisma, Laukkanen & Hiltunen, 2007). Laukkanen et al., (2007) suggest a waste of US$135 billion each year in the US on the marketing of new products that ultimately fail (Clancy, Wolf & Krieg, 2006). So there is demonstrable relevance to research these concepts together in order to get a better understanding of the factors that cause a high failure rate of innovations.

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1.2 Theoretical contribution

This research dives into the gap that exists between consumer’s level of resistance towards innovation, and the role of the brand within this concept. The difference between incremental innovations and radical innovations are taken into account, because the level of radicalness

influences the degree of consumer resistance (Ram & Sheth, 1989). Besides, little research has been conducted on the relationship between the brand and an innovation, especially in relation to consumer resistance towards innovation. Consumer resistance towards innovations is a major driver of market introduction failures. There has been a lot of research on the positive adoption decisions, but less on consumer resistance towards innovation, that precedes final adoption. However, there has been researching done to the effect of the brand in the adoption process, and it is known that it has a positive influence on whether someone is likely to adopt the innovation or not. But, it is unknown how a brand plays a role in consumer resistance towards innovation, which precedes final innovation adoption. So, the fact that a brand can have a positive influence on the innovation adoption, raises the question whether the brand can play a role in overcoming the resistance. Also, in the area of

consumer resistance, most research is done to discover how consumer resistance and their different barriers work. But it is unknown how brands can play a role in reducing the resistance. In this respect, there is an interesting gap where this research can contribute to the current theory.

In sum, this research tries to answer how brand credibility and brand innovativeness influence the degree of active innovation resistance for two type of innovations (radical vs. incremental). This will be measured by conducting an online experiment. The study will start in a broad scope by reviewing existing literature on innovation resistance, the function of brands in innovations, the radicalness of innovations and brand credibility and brand innovativeness. Based on this review, the argumentation of the hypotheses will be explained and the conceptual framework will be visualized. Next the research design, results, conclusion, discussion, and references will follow.

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2. Literature review

This literature review will elaborate upon the theory of the key concepts of this research.

First of all, the relationship between brands and innovations will be explained to show the relevance between those concepts. Next, the function of a brand in an innovation will be discussed, which will be followed by a general introduction of resistance towards innovations. After this, the difference between consumers resistance and adoption in this research is explained. Following that, the concept of consumer resistance will be explained in more detail. This is followed by the different levels of innovations. Finally, this literature review will dive deeper into the concepts around the brand, to be specific, brand credibility and brand innovativeness.

2.1 Brands and innovations

The role of branding and innovation is becoming more important. The role of branding has rapidly changed in the last decade (Abbing & Van Gessel, 2008). Nowadays, it represents a vision and strategic positioning of an organization in its environment, whereas it earlier represented an origin or sign of ownership (Abbing & Van Gessel, 2008). A strong brand has a number of marketing

advantages that ease the extension to a new product category. Strong brands support and have the ability to increase the marketing communication effect; brand names can help consumers recall product information, for instance (Brexendorf et al., 2015). Innovation is becoming more important and present in the DNA of the strategy in most organizations (Aaker, 2007). Innovation will lead to growth and profitability. Innovation is also seen as a way to differentiate (Aaker, 2007).

A brand strategy can be critical to the success of innovation (Aaker, 2007). Branding can make the difference; without a strong branding strategy, an innovation can be short lived. According to Aaker (2007), branding does not mean putting a name or logo on an innovation, but it means that the brand is part of a coherent strategy, which is supported by brand building programs. Branding can help improve the business in three ways (Aaker, 2007). First, it can create or improve the offering (make it differentiated and attractive). The innovation can act as a branded or sub-branded product. Secondly, it can create a new subcategory to change what customers are buying. And thirdly, it can affect perceptions of the organization and the innovation; it can give energy and more credibility to the innovation. In all three ways, the capacity of an innovation to be a success can be enhanced if it is

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branded, under the condition that the brand strategy is well conceived and executed (Aaker, 2007).

A brand provides an innovation from different important functions that help the innovation to be successful. The brand allows ownership of the innovation, adds credibility and legitimacy, enhances visibility, and helps to communicate facts (Aaker, 2007).

2.2 Brand function in innovations

Organizational competitive advantage and growth rely on strong brands and innovations (Brexendorf, Bayus and Keller, 2015). Brexendorf et al., (2015) argues that brands benefit from innovations and the other way around. But the forgotten dimension of innovation is branding (Aaker, 2007).

Brands have the ability to reduce the risk for the consumer and set consumer expectations

(Brexendorf et al., 2015). Brand and innovation management together play an important role in the evaluation and creation of a favorable consumer response. Therefore, during the introduction of a new product, brands can give a new product meaning that facilitates its launch (Page and Herr, 2002). Brand knowledge can also have an effect on intention to adopt. Chen and He (2003) researched the influence of brand knowledge on intention to adopt an online retailer. They showed that brand knowledge has a direct and positive effect on intention to adopt an online retailer. They discovered that this effect could largely be mediated through perceived risk (Chen & He, 2003).

How product and service innovations can enhance organizational value and profit is a current top of management priority (Srinivasan, Pauwels, Silva-Risso and Hanssens, 2009). Organizations increasingly hang down on the success of new products and services in order to secure and keep their competitive advantages (Steenkamp, Hofstede & Wedel, 1999; Keller and Lehmann, 2006). Organizations have to deal with a rapidly changing marketplace at the same time as consumers have to make difficult choices due to the lack of ability to judge product quality. This lack especially exists in judging the performance of new products. In this situation, brands can play an important role in the valuation of new products. Customers may form judgments about the company or organization behind the brand. This is about the reputation that the brand has achieved in the marketplace in terms of

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perceived expertise, trustworthiness, and likability (Brexendorf et al., 2015). These three dimensions can measure brand credibility.

Innovation and brands are both important when it comes to organizational competitive advantage (Brexendorf et al., 2015). They both can benefit from each other, but their relationship is still under-researched (Brexendorf et al., 2015). It is therefore important to get more insights into how this relationship works. However, as mentioned before, innovations are not always successful. The brand may have a positive effect on the innovation, but the innovation itself needs to be successful first. This, among other things, means that consumer resistance has to be overcome before the final adoption can start (Ram, 1987). One of the major causes for market failure of innovations is actually resistance from consumers towards innovation (Ram & Seth, 1989). Innovations require consumers to adopt different behaviors. This can create uncertainties and risks that make the adoption decision different than another type of decision the consumer has to make (Hoeffler, 2003). It is therefore important to understand the innovation decision process, where resistance and adoption take place.

2.3 Introduction to consumer resistance towards innovation

An innovation may require a high change in consumer’s daily routines and may conflict with consumer’s prior belief structure. Innovation resistance can therefore, according to Ram and Seth (1989), be defined as: ‘The resistance offered by consumers to innovation, either because it poses

potential changes from a satisfactory status quo or because it conflicts with their prior beliefs’.

Consumers’ resistance towards innovation has different characteristics. Ram and Seth (1989) explain three characteristics. The first one is that innovation resistance affects the timing of adoption and classifies adopters of innovation into five categories: innovators, early adopters, early majority, late majority, and laggards. Each of these classifications has a different level of resistance and differs in the timing of adoption. Secondly, resistance varies in degree from a continuum, increasing from passive resistance or inertia to active resistance. Thirdly, innovation resistance differs and exists across product classes. An important aspect of this characteristic is the two basic causes of

resistance: the degree of change or discontinuity brought by an innovation, and the extent to which it conflicts with the consumers’ belief structure (Ram & Seth, 1989).

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Ram (1987) also argues that resistance is a normal consumer response to an innovation. Adoption may begin after the initial resistance has been overcome, thus there is always some resistance before actual adoption. Adoption is the result of exceeding the resistant behavior (Cornescu & Adam, 2013). Adoption and resistance may also coexist and can occur at all the different stages of the adoption process. This explains that resistance is a primary cause for failure of innovations (Cornescu & Adam, 2013).

2.4 Difference between consumers resistance and adoption

Intrinsic and extrinsic factors of the brand have a proven impact on the adoption decision and can facilitate the innovation adoption (Brexendorf et al., 2015). It is also known that consumer resistance needs to be overcome first before the final adoption takes place (Ram, 1987). It is important to understand why consumers will or will not adopt a new product or service (Arts, Frambach & Bijmold, 2011). Research about the clear difference between adoption and innovation resistance is scarce (Conrnescu & Adam, 2013). Since the gap of this research lies in the moderating effect on the relationship between innovation type and consumers’ resistance, it is important to define the distinction between resistance and adoption.

Innovation adoption can be defined as: ‘Consumers decision to make full use of an innovation’ (Rogers, 2003). Adoption is the acceptation from the consumer to use a product, service, or idea on a continuous base. Many studies differentiate adoption from resistance and consider resistance as non-adoption. But this doesn’t mean that we can consider consumer resistance as the obverse of adoption (Gatignon & Robertson, 1989; Herbig & Day, 1992; Nabih & Poiesz, 1997; Ram & Sheth, 1989; Cooper, 1990). Studying the resistance towards an innovation is important for designing and improving products to ensure the market successes and diminish the market failures (Cornescu & Adam, 203). If resistance cannot come across, the adoption process slows down and the chance of failing the innovation is high (Ram, 1989). Consumer resistance is defined as: ‘The resistance offered

by consumers to innovation, either because it poses potential changes from a satisfactory status quo or because it conflicts with their prior beliefs’. It is about how consumers react to new or improved

products that come onto the market (Cornescu & Adam, 2013). The response of a consumer on an innovation can be in favor of or against it; they can choose to adopt or resist it. Cornescu and Adam

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(2013) consider adoption and resistance both as a result of resistance that arises by the consumers once they get confronted with an innovation. Both results are known as reactions toward the

innovation, but the adoption is described as the result of overcoming the resistance (Szmigin & Foxall, 1998). This means that if the response of the consumer is against the innovation, this is represented by the persistence of resistance (Cornescu & Adam, 2013). Thus, if the consumer is able to accept the refuse of the new product and he will judge the changes as satisfactory, the changes will be accepted. But, if the changes don’t fit the requirements or modifies in a way that is accustomed to the consumer, the consumer will not accept the change, and therefore resist it (Cornescu & Adam, 2013).

2.5 Innovation decision process

As mentioned before, actual adoption of an innovation may begin after the initial resistance has been overcome. However, this is still vague, because it still does not make clear when resistance stops en adoption starts. Therefore, this section will dive deeper into the innovation decision process. This process shows the different stages where consumers go through when they get confronted with a new innovation.

Talke and Heidenreich (2014) describe the fundamental structure that underlies the innovation decision model based on Rogers (2003). In this process it becomes clear how adoption and

resistance are related and where the different forms (active and passive) of resistance take place in this decision process. This model includes five stages: knowledge, persuasion, decision,

implementation, and confirmation (Rogers & Shoemakers, 1971). Talke and Heidenreich (2014) also incorporate the contextual factors that encircle and influence the decision process. Therefore, first the contextual factors will be explained, followed by the decision process, which includes the emergence of passive and active resistance.

Contextual factors of the decision process

The decision process is surrounded by three factors: adopter specific factors, situation specific factors and innovation specific factors (Talke & Heidenreich, 2014). Those factors are shown in figure 1.

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Figure 1: Contextual factors that lead to resistance (Talke & Heidenreich, 2014)

Adopter specific factors are characteristics of the decision maker, which includes her or his

personality, aspirations, change-related traits, and motivations that form their inclination to resist changes. Consumers with a high inclination to resist change, hardly ever search for product related information. Those consumers are therefore disrupted prior to the persuasion stage. This causes an early emergence of passive innovation resistance at the early stage of the adoption process, because it is driven by an inclination to resist change. Situation specific factors are characteristics of the situation in which the innovation takes place. The status quo satisfaction is driven by the usage and possession of products. The status quo satisfaction therefore directly influences the passive innovation resistance. A high level of situational passive innovation resistance is able to stop the decision process before the persuasion stage. This is due to the fact that consumers that are satisfied with the products they possess and use, are unlikely to search for information about potential

substitutes. Innovation specific factors represent attributes of the new product such as innovation’s relative advantage, complexity, compatibility, try ability, and observe ability. Those attributes become relevant as soon as consumers start to process information about the new product. As soon as consumers’ expectations and perceptions of the innovation attributes diverge, functional and psychological barriers can arise, which create a negative attitude towards the innovation. Innovation specific factors therefore cause active innovation resistance and strongly influence the persuasion stage, because in this stage a general perception of an innovation is formed. Nevertheless, innovation specific factors can also have an impact on the rest of the stages of the process, as consumers reflect

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on their decision and actions (Talke & Heidenreich, 2014). The three different contextual categories and their factors are visualized in figure 2 and 3.

Talke and Heidenrech (2014) show how passive and active innovation resistance can be incorporated in the innovation decision model. The model focuses on the early stages of the decision process where active and passive resistance appear. Figure 4 Shows their model and will be explained in more detail in the next paragraph.

Figure 2: Adopter and situation specific characteristics as a contextual factor, consisting of inclination to resist changes and status quo satisfaction that lead to passive innovation resistance (Talke & heidenreich, 2014).

Figure 3: Innovation specific characteristics as a contextual factor, consisting of function and psychological barriers that lead to active innovation resistance (Talke & Heidenreich, 2014).

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Figure 4: Innovation decision model (Talke & Heidenrech, 2014)

If consumers get exposed to an innovation, they become aware of the innovation in the first stage, which is called the knowledge stage (Talke & Heidenreich, 2014). In this stage, passive innovation resistance appears (Kruisma et al., 2007). This passive resistance depends on two factors:

consumers’ status quo satisfaction and consumers’ inclination to resist changes. If consumers contain a low level of passive innovation resistance, they seek further information to judge the innovation and the decision process will proceed. However, although there exist a low level of passive innovation resistance, it can still impact the rest of the decision process stages. The knowledge stage can have two outcomes: passive resistance and passive acceptance. Low levels of passive innovation

resistance may not cause passive rejection directly in the knowledge stage, but it creates functional and psychological barriers during new product evaluation, which may cause active innovation resistance (Talke & Heidenreich, 2014). Higher passive innovation resistance creates more negative responses to the innovation. Innovation attributes are then perceived less favorable and increase the deviation of expectations (Talke & Heidenreich, 2014). Passive innovation acceptance also may arise. This means that consumers positively accept and subsequently adopt the new product without evaluating it. However, for innovations, this is improbable because innovations bring routine changes which require an evaluation. Passive innovation acceptance is more likely to occur in impulsive purchases (Talke & Heidenreich, 2014).

In the persuasion stage consumers form a general perception based on their evaluation of the innovation. The outcome of this stage is active innovation acceptance or active innovation resistance.

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This outcome is driven by the positive or negative attitudes. The different innovation barriers, which will be explained later, create those attitudes. In this attitude formation, consumers evaluate the innovation based on information that comes from product descriptions, ads, social network or media. From those sources, they gather information such as product features and functions, costs, usage and possibilities to solve individual problems (Talke & Heidenreich, 2014). The general perception of the innovation that is formed in this evaluation process, needs to be compared to the expectations of the consumer. If the perception suits the expectations, functional and psychological barriers are limited. In this case, a positive attitude will be formed, which drive active innovation acceptance. However, if perceptions deviate from expectations, functional and psychological barriers will appear. If a consumer perceives the innovation as too complex or too risky, this may lead to a negative attitude toward the innovation that drives active resistance (Talke & Heidenreich, 2014).

In the decision stage, consumers make their intended decision to either adopt or reject the innovation based on the attitude that is formed in the previous stages (Talke & Heidenrich, 2013). In this stage consumers refine their understanding of how the innovation can act in their life, to make a judgment. This can be based on new information that is acquired accidentally or actively. If the information confirms the previous perception, active innovation acceptance or resistance leads to the final decision to adopt or reject. However, if new stimuli conflict with the previous impression and

expectation, it can affect functional and psychological barriers (Talke & Heidenrich, 2013). Contingent on the extent of the increase or decrease, the attitude may turn into a decision that was not in line with the result from the persuasion stage (Nabih & Poiesz, 1997).

In the implementation stage, the intentions become concrete behavior (Talke & Heidenreich, 2014). Adoption means purchasing the innovation with at least one initial use, and rejection means not purchasing the innovation. But, this intention to adopt or reject does not always turn into congruent behavior. Consumers can still be uncertain and therefore search for other stimuli, which still can reverse their decision. Even at this stage, passive innovation resistance can influence the likelihood of short-term rejections.

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In the last stage, the confirmation stage, consumers look for reinforcement of their adoption or rejection behavior. They can continue, stop or reverse their behavior. They may decide to reverse it if they have been exposed to contradicting information about the innovation (Talke & Heidenreich, 2014). According to Rogers (2003), the adoption process ends once the adopter uses the innovation or if the adopter will not buy the innovation at a later time.

Heidenrech and Spieth (2013) look at the influence of passive innovation resistance on active innovation resistance. They prove that passive innovation resistance could explain a substantial proportion in the variance of active innovation resistance and adoption intention. They indicate that status quo satisfaction and inclination to resist change have a negative effect on new product evaluation. This appears in the fact that consumers, in general, over-rate products they possess and underestimate new benefits that an innovation provides, due to the changes an innovation entails. So, if there is a high level of passive innovation resistance, this probably will result in high active

innovation resistance. Passive innovation resistance has a positive impact on the value, complexity, usage, and risk barrier, which create a higher level of active innovation resistance.

To conclude, passive innovation resistance occurs prior to the evaluation of a new product or innovation. Passive innovation resistance is caused by two factors: adopters inclination to resist change, and adopter’s status quo satisfaction. Active innovation resistance is driven by product specific barriers that evolve during the evaluation process (Talke & Heidenreich, 2013). See figure 4 for the complete decision model. In section 2.6 we will dive deeper into these specific barriers that create active innovation resistance.

Based on the literature mentioned above, this study will focus on the persuasion stage where active innovation resistance appears. This is because passive innovation resistance arises from adopter specific factors that form an inclination to resist change and situation specific factors that determine an individual’s status quo satisfaction. These factors take care of the fact that consumers resist innovations without evaluating them (Talke & Heidenreich, 2014). Whereas active innovation resistance is the attitudinal outcome of an unfavorable evaluation of a new product (Nabih et al., 1997). This is caused by innovation specific factors. A brand can be seen as an extrinsic cue which is

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an innovation specific factor (Keller & Aaker, 1998). Since this study looks into the moderating effect of a brand on innovation resistance, this research will focus on active innovation resistance in the specific persuasion stage of the innovation decision process.

2.6 Resistance in consumer behavior

The consumer does not interpret all of an organization’s innovations as beneficial changes. The important aspect of resistance to innovation is the resistance that is forced by innovation changes (specific changes in the product), which is named resistance to change (Gatignon & Robertson, 1989). Thus, it is not always an innovation itself that the consumer resists, but it is also about the associated changes that consumers resist. (Ellen, Bearden & Sharama, 1991).

Figure 5: The relationship between resistance and rejection according to Kruisma, Laukkanen and Hiltunen (2007).

Kruisma, Laukkanen and Hiltunen (2007) define resistance as an active behavior, which is possible to take place in every adoption process, but do not automatically mean that an innovation is not going to be adopted (figure 5). Another possible result can be rejection, which is seen as the passive form of behavior where consumers decide not to adopt, or to ignore the innovation (Kruisma et al., 2007).

However, consumer resistance can appear in other different forms of behavior; rejection,

postponement and opposition (figure 6) (Smizigin & Foxall, 1998). With these different behaviors, consumer resistance can further be outlined on the basis of ‘not trying the innovation’ (Roger, 2003).

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Figure 6: Concepts of consumer resistance according to Smizigin and Foxall (1998), compared to the concept of consumer resistance according to Kruisma, Laukkanen and Hiltunen (2007).

In this research consumer resistance will be defined as a response to an innovation, which precedes the final adoption or non-adoption. Innovation resistance can be expressed in different forms of behavior: rejection, postponement and opposition.

Rejection implies an active evaluation on the part of the consumer; this is a strong unwillingness to adopt an innovation (Rogers, 2003). As the amount and variety of risks increases, consumers are more likely to simply reject an innovation, rather than postpone an innovation, for example. According to Kleijnen et al., (2013) functional, economic and social risks are the most important drivers of rejection. However, the perceived image is important in the rejection of an innovation as well. The image is a set of associations that a consumer relates to the innovation; this can serve as a negative extrinsic cue, which will increase the probability of rejecting an innovation.

Postponement is about the fact that consumers may decide to not adopt the innovation although they find the innovation acceptable. This may occur when the circumstances are not suitable, or

consumers want to wait for a specific characteristic of the innovation. This is also known as a “delay,” which is a form of consumer resistance (Greenleaf & Lehmann’s, 1995). Postponement is also seen as the weakest form of resistance and is most of the time driven by situational barriers that can be temporary (Szmigin & Foxall, 1998). According to the research of Kleijen et al., (2013) economic risks and usage patterns are the main drivers for consumers to postpone an innovation.

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Opposition implies that consumers may be convinced that the innovation is unsuitable, and attack the launch of the innovation negatively by word of mouth, for instance. This is also called ‘innovation sabotage’, which occurs when the consumers purposefully engage in an attack to prevent an

innovation success (Davidson and Walley, 1985). Kleijen et al., (2013) found that opposition seems to mostly be driven by factors that are strongly embedded in the personal and social environment of the consumer. They also found that these factors are more likely to take place in radical innovations than incremental innovations.

2.7 Barriers to adoption

Consumers have different barriers that disable their desire to adopt an innovation (Ram & Seth, 1989). The different barriers of adoption create an attitude towards the innovation that together results in the level of active innovation resistance. These barriers can be divided into two dimensions:

functional and psychosocial barriers. Functional barriers are: Usage barrier, value barrier and risk

barrier and psychosocial barriers are: tradition barrier and image barrier (Lian & Yen, 2013; Ram & Seth, 1989). This is visualized in figure 7.

Figure 7: Barriers to adoption according to Ram and Seth (1989).

Functional barriers will arise when consumers become aware of the changes from adopting the innovation. Psychosocial barriers are generated through the conflict with consumer’s prior beliefs (Ram & Sheth, 1989). An usage barrier is the most common reason for consumers resistance. It could

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be that the innovation is inconsistent with consumers’ existing workflows, practices or habits, or with consumers’ past experiences, values, acceptance requirements. If this is conflicting with work and habits, the consumer need a long time to accept the innovation (Lian & Yen, 2013). Innovations that require a change in consumers behavior and routines, will create an usage barrier (Sheth & Ram, 1989). The value barrier addresses the performance-to-price value compared to substitutes. If there is no performance-to-price value compared to substitutes, consumers don’t have any incentive to change (Sheth & Ram, 1989). Thus, the user is only willing to accept changes if the innovation provides a higher value than the existing product (Lian & Yen, 2013). A risk barrier refers to the uncertainty and potential side effects of the innovation perceived by the consumer. Consumers therefore try to postpone the innovation until they know more about it (Ram & Sheth, 1989). Risk is constituted by the evaluation of the likelihood of negative outcomes. Consumers feel uncertainty about the adoption of the innovation. The assumption of a negative outcome of the usage of the innovation form consumers perceived risk. There are many forms of risks (Bredahl, 2001; Ram & Seth, 1989; Seba et al., 2000). Physical risk is about the perceptions of the potential damage to persons or property, which can be caused by the innovation (Klerck & Sweeney, 2007). Economic risk is about the costs of an innovation. Functional risk is about the uncertainty of the performance of the innovation. Social risk is whether the consumer feels that his or her social environment will support or accept the adoption; a lack of social support for the innovation can result in an isolation in consumers’ social system (Kleinen et al., 2009). The tradition barrier refers to the fact that consumers have to deviate from their established traditions. The more the innovation differs from their traditions, the greater the resistance.

Considering the traditions and norms, barriers are created by any behavior that is in contrast with group norms, or societal or family values (Herbig & Day, 1992). Resistance can be a consequence of habits; consumers who feel satisfied with a current situation do not have a reason to change (Sheth, 1989). Using a product frequently forms habits; resistance may thus be a logical result of innovations that conflict with the usage patterns. So routine behaviors needs to be changed before an innovation achieves acceptance (Kleijnen et al., 2009). The final barrier, the image barrier, is about the

identification with the origin of the innovation. This contains the product class, the industry, or the country where the innovation is produced. These all cause associations; when these associations are

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unfavorable, there is a barrier to adoption. The image is likely to be derived from stereotypes, rumors, or other non-experiential sources (Sam & Sheth, 1989). Perceived product image of an innovation also has influence on consumer’s resistance. An image serves as an extrinsic cue for consumers to base their decisions on (Bearden & Shimp, 1982). Extrinsic product cues are important for consumers to judge new products. Product characteristics and the functions of an innovation seem hard to be observed, but the image is likely to be derived from stereotypes, rumors, or other non-experiential sources (Ram & Seth, 1989). Besides, an identity or judgment may be obtained from the innovations’ origins, product class, industry, or country where it comes from. Complexity is also a part of the perceived product image. If an innovation is difficult to understand and use, it causes an obstacle to adoption (Rogers, 2003, Tornatzky & Klein, 1982). It is about the cognitive effort that is related to the innovation adoption.

To continue on the conceptualization of Talke and Heidenreich (2014), all the different functional and psychological barriers are innovation specific factors that lead to active innovation resistance. This is visualized in figure 3.

2.8 Innovation types

An innovation can be defined as ‘An idea, practice or material artifact that is perceived as new by the

relevant unit of adoption’ (Zaltman, Duncan & Holbek, 1973). Assinks (2006) defines it as “a product, process or service, either with unprecedented performance characteristics or familiar characteristic that offer significant improvements in performance of cost, which transforms the existing market or create new ones” (Assink, 2006, p.215). Innovations vary in newness for the adopter; this is the notion

of radicalness. Incremental innovations adapt, refine, simplify, and improve products of existing systems of production and distribution (Song & Montoya, 1998). Those innovations result in a lesser degree of departure from existing characteristics (Damanpour, 1988). Nord and Tucker (1987) named it as a routine innovation; an innovation that produces minor changes in products, services, or the production process. A non-routine innovation, also known as radical innovations, contains changes in the internal and external environment of the adopting organization. Radical innovations do have fundamental changes (Dewar & Dutton, 1986) and incorporate different core technology, however provide higher customer benefits compared to previous products in the industry (Chandy and Tellis,

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1998; Tunes & Post 2000). Radical innovations also have longer lifecycles and are more

unpredictable and context dependent, whereas incremental innovations are more predictable and have fewer uncertainties (Keizer & Halman, 2007). Radical innovations are represented by a fully novel idea or object which may create a new market, or produce major changes in existing products (Cornescu & Adam, 2013).

A product that is perceived by the consumer as new is an innovation. The perceived newness of a product comes through the changes it contains in one attribute of the product or a radical change in the product concept (Ram, 1987). The distinction between incremental and radical innovations can therefore not be categorized. It depends upon the perceptions of consumers that are familiar with the degree of innovation (Dewar & Dutton, 1986). This is accompanied by the knowledge that the consumer has prior to the introduction of the innovation. Whether some innovation is incremental or radical depends on the judgment of an innovation, which is based on the level of familiarity and experience (Ram, 1987). The greater the behavioral change the innovation entails, the greater the resistance amongst consumers (Laukkanen, Sinkkonen, Kivijarvi & Laukkanen, 2007). According to Keizer and Halman (2007), radical innovations bring inherently more risk. Also, the more the

innovation differs from traditions, the greater the resistance. This shows that the type of radicalness is subjective, rather than objective (Sam & Sheth, 1989). It thus can be assumed that the more the innovation is perceived as radical, the greater the risk barrier is for the consumer, and therefore the greater the chance is that the consumer rejects the innovation (Kleijnen et al., 2009; Sam & Sheth, 1989; Keizer & Halman, 2007).

2.9 Branding an innovation

A brand has the capability to own an innovation, add legitimacy and credibility, empower the visibility, and drive communication effectiveness (Keller & Aaker, 1998). A brand can support a

transformational innovation that is done in a new subcategory. It helps define, position, and dominate the new entered category. A good innovation can also affect the parent organizational brand.

Consumers form expectations based on the parent brand about whether or not they think they like a new product (Aaker, 1996; Keller, 2012). If the parent brand causes positive expectations, it will therefore improve the extension success. Innovations are not always made by the parent brand,

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however they are also likely to be made via a sub brand. Rao, Agarwal & Dahlhoff (2004) found that a branded house strategy in the form of the corporate branding is a more financially advantageous strategy than a branded house strategy. A branded house is a firm that shares all their products under the same brand name. The benefit of having a branded house is that one can build a reputation of technological innovation, which will be transferred to new products and service that share the same brand name (Brown and Dacin, 1997). Whereas a house of brands introduces all new products under a different brand name (Rubera & Droge, 2013). The type of branding strategy can thus influence the success of the innovation (Rao et al., 2004; Rubera & Droge, 2013).

New products can enter the market in different ways. They can be introduced by using the core brand name and add a series of newness indicators that convey the next generation; these can be in the form of a number (Iphone 4/5/5s/6/6s), a date (Powerpoint 2012), or a superlative. Another option is using a new brand name, a sub-brand (Gillette Mach, Gillete Fusion, Seat Ibiza, Seat Toledo), that strays from the existing brand name. The proper brand strategy depends on what the firm wants to signal, and how the firm wants to distinguish from or appear similar to an existing product (Bertini, Gourville & Ofek, 2011). Consumers tend to associate a switch from an established brand name to a new brand name with a higher degree of change in the new product (Bertini et al., 2011). Consumers expect greater potential rewards (quality and functionality) and risks (failure and learning cost) from a new branded product. The adoption of a new branded product is influenced by the salience of these risks and rewards, but also by the purchase context, personal character, and other factors (Bertini et al., 2011). Studies show that the preference for innovations that are launched under new versus existing brand names differs by the level of technological uncertainty. In a high technological uncertainty, it is good to pioneer with new brands across renewals because it enhances the preference of a new innovation over previous renewals. In a low level of technological uncertainty, using the same brand that already exists in different generations of the product leads to higher preferences to former product generations (Chang & Park, 2013).

According to Bearden and Shimp (1982), the adoption of innovations is facilitated by the reputations and quality of the innovation which is often signaled by brands. This can help reduce the inherent risk of the adoption. Prins and Verhoef (2007) also show that consumers that are loyal to the brand adopt

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innovation earlier than new customers. The brand thus has a strong influence on product and service adoption behavior.

Branded innovations can help the business in three ways. First, they can create or improve the product or service that they offer, or they can make it more attractive and differentiated from other others. Second, it can create a new sub-category for the brand, in which the brand can manage perceptions and ensure that consumers change what they tend to buy. And third, a branded innovation can affect perception of the organization or corporate brand on their innovativeness in order to make it respected, give it energy, or make new products more. Thus, if the innovation is branded, the ability for having a potential impact is enhanced (Aaker, 2007).

2.10 Brand innovativeness and brand credibility

Keller and Aaker (1998) found that an organization’s reputation for being innovative could affect the acceptation of a new product. Also, branding an innovation can affect the innovativeness image of the brand. As mentioned before, final adoption is the acceptation from the consumer to use a product, service, or idea on a continual basis (Rogers & Shoemakers, 1971; Rogers, 2003). This happens in the implementation stage, after resistance has been overcome. Therefore, it is interesting to look at the effect of those factors on the level of resistance.

2.9.1 Brand innovativeness

Brand innovativeness can be defined as the extent to which consumers perceive brands as being able

to provide new and useful solutions to their needs (Pappu & Quester, 2016). In most instances it is

beneficial for an organization to be perceived as innovative (Aaker, 2007). If a brand is seen as innovative, it can use its reputation for the successful introduction of a wider range of extensions (Brexendorf et al., 2015). Innovations are not always made to create innovative products and

processes, but also to influence the perception of the organization in the marketplace. There are three important reasons for an organization to have a reputation for innovations. At first, an innovative image provides credibility for new products. Research has proven that an image of being innovative enhances prospects for new products. The acceptance of a new product is affected by the reputation of being innovative. If an innovation comes from a firm that is viewed as innovative, customers reduce

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their natural skepticism about the innovation. Secondly, if an organization has the reputation of being innovative, it will make the organization more attractive to customers. And third, innovation can contribute to the stature of the firm because innovation is associated with leadership and success, and consumers like to be associated with leaders (Aaker, 2007). Brand innovativeness is often used as a part of the brand personality and positioning. Brands that are seen as innovative earn ‘innovation credit’. Innovation credit is an intangible credit that the brand equity gains with consumer’s admiration for the effort to develop new products, services, or other innovative practices for the market.

Innovation credit is a meaningful element of brand equity, since it permits a firm to engage in marketing strategies that can deviate or violate general category norms (Barone & Jewell, 2013). Being seen as innovative also impacts the brand’s credibility on three levels. This especially occurs on the level of brand expertise (Keller & Aaker, 1998).

2.9.2 Brand credibility

An innovative image can give new products more credibility. Also, corporate marketing that shows product innovation strengthens the brand credibility. It enhances the perceptions of corporate expertise, trustworthiness, and the likeability of a brand (Keller & Aaker, 1998). These concepts together are called brand credibility (Brexendorf et al., 2015; Keller & Aaker, 1998). Brand credibility is the extent in which consumers view the company or organization positively or not. Such as the extent to which consumers believe that a company is able to meet their needs and wants (Keller & Aaker, 1998). Erden and Swait (1998) define this as ‘Consistently deliver as promised’. Corporate expertise is the extent to which the company is perceived to be able to complete, make, and market their products. Second, corporate trustworthiness is whether the company is perceived to be dependable, sincere, and sensitive to the needs of their consumers. Third, corporate likeability is the extent to which a company is perceived as interesting, likable, and prestigious (Aaker & Keller, 1998). If a brand is seen as more credible, consumers tend to have less perceived risks (Srinivasan & Ratchford, 1991, Shugan, 1980). Perceived brand credibility increases the likelihood of considering a brand (Erdem and Swait, 2004). It also is important in the valuation of new products, because it act as an extrinsic cue on which consumers can judge new products (Keller & Aaker, 1998).

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Since the brand has many functions and underlying concepts, brand credibility will be used in this research as the ‘effect of the brand’ on consumer resistance. Because brand credibility can thus have a positive impact on the acceptance of a new product, this concept will be used to see whether it has an influence on the degree of consumer resistance. Due to the fact that it can have an effect on the acceptance, it is interesting to test whether the brand credibility is also able to reduce the degree of resistance, which precedes the final adoption a new product or innovation.

Also, being seen as innovative can impact all the dimensions of credibility (Erdem & Swait, 2004). Since, brand innovativeness can provide credibility to new products and acceptance of new products affected by the reputation of being innovative, brand innovativeness will also be used in the research as the ‘effect of the brand’ on consumer resistance. To conclude, brand innovativeness and brand credibility will be both used as a moderator on the relationship between innovation type and active innovation resistance.

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3. Conceptual framework and integration

This chapter will visualize the hypothetical relationships in a conceptual framework. Also, it will explain the hypothesis with the substantiated literature that underpins the expected direction of the

hypothesis.

Figure 8: Conceptual framework

3.1 Hypotheses 1: effect of innovation type on active innovation resistance

First of all, as mentioned before, the greater the change an innovation entails, the greater the

resistance amongst consumers (Laukkanen et al., 2007). A radical innovation entails greater changes than an incremental innovation. Radical innovations often produce major changes in existing products (Cornescu & Adam,2013), which require also more change in consumers behavior. It thus can be assumed that the more the innovation is perceived as radical, the greater the chance that the consumer rejects the innovation (Kleijnen et al., 2009; Sam & Sheth, 1989; Keizer & Halman, 2007), and thus the higher the level of active innovation resistance is expected to be. Therefore it is expected that the type of innovation will have a direct influence on the level of active innovation resistance. Subsequently, we expect that the influence of a radical innovation on active innovation resistance, significantly differs from the influence of an incremental innovation on active innovation resistance. Besides, it can be expected that a radical innovation causes a significantly higher level of active

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innovation resistance than an incremental innovation. Hence, the following hypotheses have been established:

H1: The type of innovation has a direct influence on the degree of consumer resistance towards

innovation.

H1a: The influence of a radical innovation on active innovation resistance significantly differs from an

incremental innovation on active innovation resistance.

H1b: A radical innovation causes a significantly higher level of resistance than an incremental

innovation.

3.2 Hypotheses 2: moderating effect of brand innovativeness

Secondly, it is expected that brand innovativeness can moderate the relationship between innovation type and the level of active innovation resistance, since the acceptance of a new product is affected by the reputation of being innovative. If an innovation comes from a brand that is perceived as innovative, customers reduce their natural skepticism about the innovation (Aaker, 2007). If brand innovativeness thus can influence the acceptance of a new product, it can be expected that it also will influence the level of resistance. This can also be linked to the innovation decision process, in the persuasion stage the attitude towards the innovation is created, in which active innovation acceptance or resistance is the outcome. If a brand is able to influence this acceptance, it can be expected that the level of resistance is lower when a brand is seen as innovative. Also, being seen as innovative, can have a positive impact on credibility (Keller & Aaker, 1995; Aaker, 2007), and if a brand is seen as more credible, consumers tend to have less perceived risks (Srinivasan & Ratchford, 1991, Shugan, 1980). Since brands on its own also have the ability to reduce risk for the consumer (Brexendorf et al., 2015), and radical innovations bring inherently more risk (Keizer & Halman, 2007), it can be also expected that the effect of brand innovativeness is stronger for a radical innovation than for an incremental innovation. Because the level of risk is higher in a radical innovation, it is expected that a brand is able to reduce more resistance in a radical innovation than in an incremental innovation. Therefore the following hypotheses can be stated:

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H2: Brand innovativeness has a moderating effect on the relationship between innovation type and

active innovation resistance.

H2a: Brand innovativeness moderates the relationship between innovation type and active innovation

resistance, so that a high level of brand innovativeness can reduce the level of active innovation resistance.

H2b: The effect of H2a is stronger for an radical innovation than for an incremental innovation.

3.3 Hypotheses 3: moderating effect of brand credibility

Finally, brand credibility is expected to have a moderating effect on the relationship between innovation type and consumer resistance towards innovation. Since brand credibility increases the likelihood of considering a brand (Erdem and Swait, 2004) and is important in the valuation of new products (Keller & Aaker, 1998), brand credibility might have an effect on the level of active innovation resistance. Brand credibility is an extrinsic cue, where consumers can judge new products on. Those cues are important in the persuasion and decision stage of the innovation decision model, because it contributes to the attitude that will be formed towards the innovation. This attitude is important for either innovation acceptance or innovation resistance. Also, if a brand is seen as more credible, consumers tend to have less perceived risks (Srinivasan & Ratchford, 1991, Shugan, 1980), which indicate that it can have an influence on the innovation resistance since one of the factors that creates resistance, is the risk barrier. Based on these facts, it is expected that brand credibility has a

moderating effect on the relationship between innovation type and consumer’s active innovation resistance towards innovation. Also, since consumers tend to have less perceived risks if a brand is more seen as credible (Srinivasan & Ratchford, 1991, Shugan, 1980), and a radical innovation inherently brings more risks (Keizer & Halman, 2007), it can be expected that the effect of brand credibility is stronger for a radical innovation than for an incremental innovation. Hence, the following hypotheses have been established:

H3: Brand credibility has a moderating effect on the relationship between innovation type and active

innovation resistance.

H3a: Brand credibility moderates the relationship between innovation type and active innovation

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4. Research design

In order to answer the research question ‘How do brand credibility and brand innovativeness influence

the degree of active innovation resistance amongst consumers for incremental innovations compared to radical innovations?’, an online experiment was distributed. Therefore, the research has a

quantitative approach. The independent variable is the innovation type. Two types of innovations (radical and incremental) are used to discover how these differ in the dependent variable. Active innovation resistance is the dependent variable. Brand credibility and brand innovativeness are tested as the moderators on the relationship between those variables. Four different brands were used to cover different levels of brand innovativeness and credibility. This chapter will explain how the hypotheses are going to be researched.

4.1 Research method

An online experiment is applicable to measure the effect of innovation type on the level of active innovation resistance, done by brands that differ in their level of brand credibility and brand innovativeness.

4.1.1 Sample description

The population sample that is used in this research was taken from consumers. The experiment survey was made in Qualtrics and spread via internet. A convenience sample was used. The subjects are recruited via Facebook, e-mail and the personal network of the researcher. Due to the financial constraints of this research, subjects are gathered in this manner. The disadvantage of the sampling technique is that it is prone to bias and is influenced beyond the control of the researcher. Also, subjects that are excluded from the research may be different from those who are included.

Therefore, the representativeness and generalizability of the results are not guaranteed. There were no incentives provided to the participating subjects.

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4.2 Measurement of variables

In this section all the different variables that were measured will be explained. All measurements are tested on their internal consistency by measuring the Cronbach’s Alpha. Also, to secure the construct validity, validated standardized scale measurements from the literature are used.

The different measurements of the variables will take place in the car industry. The car industry frequently innovates and there are several well-known brands available in this industry. At the time of the data collection, several innovations in the car industry were new in the market or weren’t available in the market yet. To enhance the internal validity and to eliminate potential extraneous variance of the research, there was a focus in a single industry; the car industry.

4.2.1 Innovation type

According to Dewar and Dutton (1986), the degree of radicalness is not the same for every consumer. Incremental and radical innovations cannot be categorized, because it depends on the perceptions of consumers that are familiar with the degree of innovativeness and on the judgment of an innovation that is based on the level of familiarity and experience (Ram, 1987). The distinction between the two is difficult to define (Dewar & Dutton, 1986). Also, innovations change over time as well as the classifications. Steam locomotives were once really new, but today they aren’t anymore. This research thus has to deal with the fact that innovations change rapidly and that the perceived

radicalness is dated because there is a continuum of innovation that range from radical to incremental (Hage, 1980). The position of this continuum depends on the perceptions and the familiarity with the degree of anomalies of the innovation. So, whether an innovation is perceived as radial or incremental can be different across various consumers, because it depends also on the state of knowledge prior to the introduction of the innovation. To control this consequence, there is a pre-test done to establish the radicalness of an innovation. Based on this pre-test, two innovations are chosen which either represent a radical or incremental innovation. Also, by doing so the independent variable can be established and it can be assumed that the manipulations work.

To test whether an innovation is perceived as radical or incremental, innovation radicalness is

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