Retailers' new product acceptance decisions: incorporating the buyer‐supplier relationship perspective

Abstract

PurposeGiven the increasing number of new products competing for limited shelf space, retailer acceptance of new products is crucial to both retailers and suppliers. However, limited empirical research has investigated what drives retailers to accept or decline a new product offering. Extant research on retailers' new product acceptance focuses mainly on product and market factors. Despite the growing importance of buyer‐supplier relationships in new product marketing, few studies have addressed their influence on retailers' acceptance of new products. This study aims to fill the research gap by proposing a model of retailers' new product acceptance that incorporates the buyer‐supplier relationship perspective.Design/methodology/approachThis study develops an integrated research framework assessing the determinants of retailers' acceptance of new products. Four constructs were derived from the literature on buyer‐supplier relationship marketing and new products literature to investigate their influence on the retailer's decision to adopt a new product. The constructs include buyer‐seller relationship factors (relationship intensity and channel motivation) and non‐relationship factors (product advantage and market competitiveness). Hypotheses were developed and tested with a sample of retailers.FindingsOwing to the lack of appropriate existing scales for the four constructs that influence retailers' adoption of new products, this study developed and validated multiple‐item scales through psychometric scale development procedures. Hypotheses were then tested with ordinary least squares regression analysis, and all factors were found to have a positive relationship with the retailer's acceptance of new products. Results further show that buyer‐supplier relationship factors are stronger predictors of retailer new product adoption than traditional non‐relationship factors.Research limitations/implicationsThis research represents an attempt to incorporate the buyer‐supplier relationship into the process of retailer new product acceptance. Future research directions are discussed, with an emphasis on two‐way viewpoints, multiple supplier choice, and product sales performance after acceptance.Practical implicationsThe willingness of a retailer to stock a new product does not depend solely on product and market factors. In an age of intense competition and seemingly limitless product choices, suppliers must also consider the implications of the buyer‐supplier relationship before entering negotiations with retailers regarding the stocking of a new product.Originality/valueThis paper represents the first study to propose and empirically test a research model that incorporates the literature regarding both buyer‐supplier relationship marketing and new product literature. Suppliers can strengthen their competitive advantage by understanding and enhancing their performance in these factors.