Diffusion of Hedonic Goods: A Literature Review

Abstract

The consumption of hedonic goods, such as movies or books, involves multisensory, fantasy, and emotive aspects. Hedonic products are often consumed because of symbolic motives. As experience products, hedonic goods involve a high consumption risk for consumers; furthermore, suppliers of hedonic goods face significant competition. Because of these characteristics, hedonic goods have unique diffusion patterns. To provide an overview of these patterns, this article summarizes the current state of research regarding the diffusion of hedonic goods, assesses existing proposed models, and provides guidelines regarding estimating diffusion models. Furthermore, this article explains the influences of special product characteristics on diffusion processes. Results show that flexible diffusion models outperform the well-known Bass model, although the optimal modeling approach differs according to the product. Whereas the diffusion of movies nicely fits Gamma models, the diffusion of music requires more flexible models, such as logistic hazard or mixed Weibull.