New technological attributes and willingness to pay: the role of social innovativeness

Abstract

PurposeIntegrating new technological attributes into existing products is a common way to innovate and is supposed to meet consumers’ functional needs. This paper aims to demonstrate how adding such attributes also increases willingness to pay (WTP) a premium for a product by activating consumers’ social need to feel unique.Design/methodology/approachThe data were collected through a quantitative survey based on a nationally representative sample (N= 345). A choice-based conjoint analysis was used to estimate the perceived value of the new technological attribute and WTP a premium.FindingsThe perceived value of the new technological attribute has a positive effect on WTP a premium only for consumers with a high degree of social innovativeness (linked to their need for uniqueness) because they interpret this innovation as an opportunity to differentiate themselves from others.Practical implicationsWhen companies innovate by introducing new technological attributes, their communication should emphasize and trigger these attributes’ high performance and uniqueness. Thus, consumers seeking social differentiation through innovation will be much less sensitive to price and will be more prone to pay a premium for these products.Originality/valueThe main contribution of this article is to show that integrating and emphasizing a new technological attribute can increase consumers’ WTP a premium beyond that of the attribute’s functional value. Thus, new technological attributes will decrease the price sensitivity of consumers high in social innovativeness and increase their WTP a premium for the product, because they consider it as a means to stand out from others.