The Disruption That Never Was: Unpacking the Process of Product Substitution
7 Jun 2024
13:00 -17:30
Times are shown in local time.
Open to: All
Room W2.02 (Cambridge Judge Business School)
Trumpington St
Cambridge
CB2 1AG
United Kingdom
Join our Organisational Theory and Information Systems Seminar
Speaker: Professor Stine Grodal, Northeastern University
About the seminar topic
Market disruption is a central topic in management theory. For a new product to disrupt an existing market, users need to view the existing and the new products as substitutes. However, in most studies of market disruption, the process underlying product substitution is black-boxed. Understanding the process underlying product substitution is important because otherwise we cannot understand whether or not market disruption will occur. To advance knowledge in this area, we conducted an inductive qualitative study of the introduction of e-cigarettes into the US market. Initially, experts – financial analysts, vape shop owners and e-cigarette producers – predicted that e-cigarettes would disrupt the market for traditional combustible cigarettes. However, this disruption never occurred, instead e-cigarettes were exapted by another user group – teenagers and young adults. Another group of experts – public health researchers – then predicted that e-cigarette users would switch to combustible cigarettes. Yet, this reverse substitution also did not occur.
We explain this lack of substitution by pointing to differences in how experts and users judged product substitutability. We found that while experts relied on the technical dimension of the product, users focused primarily on the products’ socio-cognitive and social dimensions to judge product substitutability. This paper extends theories of market disruption by unpacking the black box of product substitution and showing that different stakeholder groups judge product substitution along different product dimensions. We show that without an understanding of how multiple stakeholder groups – including experts and users from both the existing and the new market – assess the substitutability of products along multiple dimensions, we cannot make accurate predictions about when market disruption will or will not occur nor understand the process through which market disruption unfolds.
Speaker bio
Stine Grodal is Distinguished Professor at Northeastern University D’Amore-McKim School of Business in Entrepreneurship and Innovation. She received her PhD from Stanford University in Management Science and Engineering. Her research examines the emergence and evolution of technologies, markets, and industries. She is especially interested in how firms can shape and exploit the socio-cognitive elements of markets during different stages of industry evolution. Professor Grodal uses a plurality of methods but is particularly passionate about increasing the rigor and breath of qualitative methods.