The diffusion of new products in Latin America: a new comparative approach

Abstract

Purpose The purpose of this study is to examine the diffusion pattern of new products in Latin America, and to compare the results of principal component analysis with other descriptive approaches. Design/methodology/approach The author studies the introduction of eight new products in nine Latin American countries, analysing their diffusion rate, market potential, adoption and take-off. He performs a principal component analysis and presents a biplot. The results obtained are compared using the Mantel test. Findings The results indicate that the approaches used are complementary. The biplot describes 92 per cent of the explained variance. Except for a few cases, in general, the diffusion pattern in Latin America is mainly determined by cross-country wealth differences. Research limitations/implications This study only analyses durable goods, and does not include any Central American country. Practical implications This study helps companies to predict which will be the characteristics of the diffusion pattern of other new products and to forecast their future sales. Social implications This study helps public actors to decide how to segment the Latin American market when implementing policies that encourage the diffusion of new products. Originality/value This research extends our current knowledge on the diffusion of innovations in emerging and less developed countries. This is the first study to compare the characteristics of innovation diffusion patterns in Latin America.