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Vendor Consideration and Switching Behavior for Buyers in High-Technology Markets

✍ Scribed by Jan B. Heide and Allen M. Weiss


Book ID
121290712
Publisher
American Marketing Association
Year
1995
Tongue
English
Weight
635 KB
Volume
59
Category
Article
ISSN
0022-2429

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✦ Synopsis


High-technology markets represent unique problems for organizational buyers and, in turn, for their existing and potential vendors. These problems are due to high levels of uncertainty and the presence of switching costs tied to existing technologies or vendors. The authors focus on two aspects of buyer decision making in such markets: (1) whether buyers include new vendors at the consideration stage of the process and ( 2) whether they switch to new vendors at the choice stage. Using survey data from organizational buyers' purchases of computer workstation equipment, the authors present a joint test of the antecedent conditions that influence the two processes. Based on a sequential logit model, they show that individual antecedents have different effects on consideration and switching behavior. The authors then discuss the implications of their study for the literatures on high-technology markets and organizational buyer behavior. A large and growing portion of marketing activity occurs in high-technology markets (Glazer 1991; Moriarty and Kosnik 1989). Such markets represent particular challenges both for buyers and, in turn, for existing and potential vendors. References, such as "mass confusion" (Wall Street Journal 1994), "vendor choice can be tricky" (Computerworld 1994), and "customer bewilderment" (Business Week 1991, 1993), made by industry observers suggest that high-technology markets involve considerable problems for market participants. From a buyer'sl perspective, past research has suggested that the problems that exist in high-technology markets are of two different kinds. First, such markets are characterized by considerable uncertainty. The uncertainty is due, in part, to heterogeneous and rapidly changing technologies (Glazer 1991; Norton and Bass 1987; Teece 1986), and to the fact that buyers frequently lack relevant prior experience (von Hippel 1986). Second, buyers frequently face switching costs, as a result of earlier commitments to particular product technologies or vendors (Jackson 1985; Moriarty and Kosnik 1989).

Although the previous literature has argued that hightechnology markets have unique implications for firms' de-lThroughout the article the term "buyer" will be used to describe a buying firm rather than individual buyers or organization members.


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