Rates of Takeoff in Europe

The best way to introduce products in Europe may be to showcase them in Scandinavia first. According to a paper published in a 2003 issue of Marketing Science (Volume 22, Issue 2), Scandinavian consumers embrace new products an average of two years sooner than the European average.

The authors of “The International Takeoff of New Products: The Role of Economics, Culture and Country Innovativeness” studied the launches of 10 new consumer-durables categories — from washing machines to CD players — throughout 16 industrialized European countries after 1950. In each of these categories, the authors found a distinct takeoff in sales: a period of low sales followed by a rapid uptick. However, the timing of that takeoff varied from country to country.

Although consumer-product companies often launch first in the larger European economies of Germany, the United Kingdom and France, these countries are not among the quickest to embrace new introductions on the continent, where the average was six years to takeoff. Marketers under pressure to pull the plug on investment during an initial period of low sales, may risk prematurely canceling new products that simply need a longer gestation period, suggests co-author Gerard J. Tellis, professor of marketing at the University of Southern California’s Marshall School of Business. Indeed, the average of 7.4 years to takeoff in Mediterranean Europe (almost double the average of 3.8 years required in Denmark) makes product introduction there an even more daunting prospect.

Tellis and his co-authors — Stefan Stremersch, assistant professor of marketing at Erasmus University Rotterdam, and Eden Yin, university lecturer in marketing at the University of Cambridge’s Judge Institute of Management — examined a variety of economic and cultural variables to determine predictors of the adoption rate, and they attempt to explain country by country variances. Surprisingly, economic factors such as GDP per capita, income inequality and levels of international trade were not strong predictors of which nations fostered earlier takeoff. Information-access factors such as exposure to newspapers were also measured separately, but they tend to correlate with economic factors in samples from developed economies, making it difficult to separate out their effects. Economic factors, the authors point out, could play a much larger role in other samples, especially those comprising developing economies.