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Innovation EquityAssessing and Managing the Monetary Value of New Products and Services$
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Elie Ofek, Eitan Muller, and Barak Libai

Print publication date: 2016

Print ISBN-13: 9780226618296

Published to Chicago Scholarship Online: May 2017

DOI: 10.7208/chicago/9780226394145.001.0001

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PRINTED FROM CHICAGO SCHOLARSHIP ONLINE (www.chicago.universitypressscholarship.com). (c) Copyright University of Chicago Press, 2021. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in CHSO for personal use.date: 25 October 2021

Innovation Equity Makes the World Go ’Round

Innovation Equity Makes the World Go ’Round

(p.216) Chapter Eight Innovation Equity Makes the World Go ’Round
Innovation Equity

Elie ofek

Eitan Muller

Barak Libai

University of Chicago Press

This chapter considers the book’s main framework in a global context. It establishes that innovation equity assessments typically differ across countries, even after controlling for population sizes, because diffusion and customer lifetime value parameters are generally not the same in each of them. An innovation’s diffusion scale and speed, for example, are typically affected by country-specific factors: the economic environment and cultural orientation. Cross-cultural differences in the degree of collectivism and homophily are particularly relevant for understanding international variations in the social force. Evidence is presented for how adoption in some countries can spill over to affect adoption in other countries. A global diffusion model can be constructed that allows capturing such cross-country social effects. The chapter also suggests there are often differences in customer per-period profit margins, retention rates and acquisition costs between countries. The iPhone’s global roll-out strategy is discussed and an example is presented for how to assess the equity of a particular innovation in multiple countries. Emerging online data sources, such as Google Trends, can help managers better understand the commercial prospects of new products and services in various countries and obtain proxy inputs for crafting global innovation equity analyses.

Keywords:   globalization, convergence, collectivist culture, homophilous culture, cross cultural differences, cross country effects, clout, product rollout, iPhone, Google Trends

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