The psychology of new product adoption
Read The psychology of new product adoption and check the IELTS Reading answers. An American philosopher once said, "If a man can ... make a better mousetrap than his neighbor... the world will make a beaten path to his door." If only marketing innovation was that simple. In today's marketplace, co…
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An American philosopher once said, "If a man can ... make a better mousetrap than his neighbor... the world will make a beaten path to his door." If only marketing innovation was that simple. In today's marketplace, companies that successfully introduce new products are more likely to flourish than those that don't. However, businesses spend billions of dollars making better "mousetraps" only to find consumers rejecting them. Studies show that new products fail at the staggering rate of between 40% and 90%. In the US packaged goods industry, for example, companies introduce 30,000 new products every year, but 70% to 90% of them stay on store shelves for less than 12 months. According to one study, 47% of the start-up companies that pioneered new products later went out of business altogether.
Vocabulary from this passage
13 words worth learning before you sit the test, each with the sentence it appears in.
- cornerstone noun
An important quality or feature on which a particular thing is based or depends for its fundamental integrity
Freedom of expression is considered a cornerstone of democratic societies throughout the entire modern world.
- delve into verb
To research or examine something in detail in order to find hidden information or understand a complex subject
The documentary will delve into the complex social issues that lead to persistent urban poverty.
- deviate verb
To depart from an established course, standard, or expected behavior; to turn aside from a planned path or logic
The results of the latest study deviate significantly from the patterns observed in all previous trials.
- flourish verb
To grow or develop in a healthy or vigorous way, especially as the result of a favorable environment
Small businesses often flourish when they receive consistent support from the local community and the government.
- implicit adjective
Suggested though not directly expressed; existing as an essential part of something without being clearly or explicitly stated
There was an implicit agreement between the two companies to avoid competing in certain international markets.
- loss aversion noun
A tendency in behavioral economics where the pain of losing is psychologically more powerful than the joy of gaining
Investors often experience loss aversion, leading them to hold onto declining stocks for far too long.
- novice noun
A person who is new to and inexperienced in a job or situation; a beginner in a particular field
The workshop is designed to help a novice understand the basic principles of modern graphic design.
- oblivious adjective
Not aware of or not concerned about what is happening around one, particularly regarding one's own internal cognitive processes
She remained oblivious to the technical problems that were affecting the performance of her new computer.
- phenomenon noun
A fact or situation that is observed to exist or happen, especially one whose cause is in question
Scientists are still trying to explain the natural phenomenon of the Aurora Borealis in the North.
- pioneer verb
To be among the first to explore, develop, or use a new method, area of knowledge, or specific product
She was a pioneer in the field of digital animation, developing techniques that are used today.
- psychological biases noun
Systematic patterns of deviation from rationality in judgment, whereby individuals create their own subjective reality from their perception
Marketers often exploit common psychological biases to influence the purchasing decisions of many unsuspecting consumers.
- quantify verb
To express or measure the quantity of something using numbers, making abstract data concrete for analysis or comparison
It is difficult to quantify the precise impact of social media on modern political discourse today.
- staggering adjective
So great, shocking, or surprising that it is difficult to believe or process; often used for extreme statistical data
The company reported a staggering loss of five billion dollars during the final quarter of the year.
Answers with explanations
- 27. A
The text states that **47%** (**almost half**) of companies pioneering new products ultimately **went out of business** (**collapse**). This makes Option A the only correct and supported conclusion about the US marketplace.
- 28. D
The writer argues that blaming failure on bad ideas is **too simple an explanation**. The mention of having to delve into the **psychology of behavior change** indicates that the reasons are highly **complex**, making Option D correct.
- 29. A
Kahneman and Tversky's second characteristic explicitly states that consumers judge **new products** by evaluating them **relative to** (**compare... with**) products they **already own** (**things they have bought previously**). Option A precisely mirrors this idea.
- 30. B
The experiment results show that the **Sellers demanded... twice as much** money for their mugs compared to what the Choosers were willing to pay. This means the Sellers **valued their coffee mugs more**, confirming Option B.
- 31. B
Knetsch first gave the second group coffee mugs (what they had) and then offered them the opportunity to **exchange** them for a chocolate bar (**a new product**). Therefore, they were **asked to choose between what they had and a new product** (Option B).
- 32. C
The results of the demonstration showed that **90%** of students (**almost all**) found giving up their item to be a painful loss, which severely **reduced their desire to trade** (**unwilling to swap**). Option C accurately captures this conclusion.
- 33. B
The concept of relative advantage relies on the assumption that if an innovation is **superior to existing products** (**better than those they already own**), consumers will naturally **purchase them**. This seamlessly matches sentence ending B.
- 34. A
Kahneman won the prize because he researched why individuals **deviate from rational economic behavior**, which is another way of saying that **consumers do not follow expected purchasing patterns**. This corresponds to ending A.
- 35. D
The first characteristic reveals that people judge an alternative using its **subjective or perceived value**, meaning that **consumers have their own idea of the value of a product** rather than purely rational pricing. This points to ending D.
- 36. NO
The statement claims that Rogers' theory explains the psychology of consumer choices. However, the writer explicitly states that the theory **fails to capture the psychological biases**. Because it contradicts the writer's claim, the answer is NO.
- 37. YES
The text explains that **loss aversion** creates a strong desire to keep existing products over gaining new ones. This directly supports the idea that it helps **explain why people fail to buy new products**. Thus, the statement agrees and the answer is YES.
- 38. YES
The passage points out that developers are **convinced that the product works** and believe it overcomes the shortcomings of alternatives. This aligns with the claim that they **believe their latest product will be a success**, making the answer YES.
- 39. NOT GIVEN
The text acknowledges that developers work on a new product for **years**. However, the writer never judges this process as developers **wasting too much time perfecting** it. Because this opinion is not expressed, the answer is NOT GIVEN.
- 40. NO
The text defines a **product champion** simply as a developer who strongly believes in their own innovation. There is no claim that they are only called this if they develop a **best-selling** new product (in fact, many fail). Therefore, the answer is NO.