• Journal of Global Scholars of Marketing Science
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• v.19 no.4
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• pp.24-31
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• 2009

Firms produce various products that differ by function, design, color, etc. Product proliferation occurs for three different reasons. When there exist economies of scope, the unit cost for a product is lower when it is produced in conjunction with another product than when it is produced separately. Second, consumers are heterogeneous in the sense that they have different tastes, preferences, or price elasticities. A firm can earn more profit by segmenting consumers into different groups with similar characteristics. For example, product proliferation helps a firm increase profits by satisfying various consumer needs more precisely. The third reason for product proliferation is based on strategy. Producing a number of products can not only deter entry by providing few niches, but can also cause a firm to react efficiently to a low-price entry. By producing various products, a firm can reduce niches so that potential entrants have less incentive to enter. Moreover, a firm can produce new products in response to entry, which is called fighting brands. That is, when an entrant tries to attract consumers with a low price, an incumbent introduces a new lower-quality product while maintaining the price of the existing product. The drawback of product proliferation, however, is cannibalization. Some consumers who would have bought a high-price product switch to a low-price product. Moreover, it is possible that proliferation can decrease profits when a new product is less differentiated from a rival’s than is the existing product because of more severe competition. Many studies have analyzed the effect of product line rivalry in the areas of economics and marketing. They show how a monopolist can solve the problem of cannibalization by adjusting quality in a market where consumers differ in their preferences for quality. They find that a consumer who prefers high-quality products will obtain his or her most preferred quality, but a consumer who has not such preference will obtain less than his or her preferred quality to reduce cannibalization. This study analyzed the effects of product line rivalry in a duopoly market with two types of consumers differentiated by quality preference. I assume that the two firms are asymmetric in the sense that an incumbent can produce both high- and low-quality products, while an entrant can produce only a low-quality product. The effects of product proliferation can be explained by comparing the market outcomes when an incumbent produces both products to those when it produces only one product. Compared to the case in which an incumbent produces only a high-quality product, the price of a low-quality product tends to decrease in a consumer segment that prefers low-quality products because of more severe competition. Prices, however, tend to increase in a segment with high preferences because of less severe competition. It is known that when firms compete over prices, it is optimal for a firm to increase its price when its rival increases its price, which is called a strategic complement. Since prices are strategic complements, we have two opposing effects. It turns out that the price of a high-quality product increases because the positive effect of reduced competition outweighs the negative effect of strategic complements. This implies that an incumbent needs to increase the price of a high-quality product when it is also introducing a low-quality product. However, the change in price of the entrant’s low-quality product is ambiguous. Second, compared to the case in which an incumbent produces only a low-quality product, prices tend to increase in a consumer segment with low preferences but decrease in a segment with high preferences. The prices of low-quality products decrease because the negative effect outweighs the positive effect. Moreover, when an incumbent produces both kinds of product, the price of an incumbent‘s low-quality product is higher, even though the quality of both firms’ low-quality products is the same. The reason for this is that the incumbent has less incentive to reduce the price of a low-quality product because of the negative impact on the price of its high-quality product. In fact, the effects of product line rivalry on profits depend not only on changes in price, but also on sales and cannibalization. If the difference in marginal cost is moderate compared to the difference in product quality, the positive effect of product proliferation outweighs the negative effect, thereby increasing the profit. Furthermore, if the cost difference is very large (small), an incumbent is better off producing only a low (high) quality product. Moreover, this study also analyzed the effect of product line rivalry when a firm can determine product characteristics by focusing on the issue of fighting brands. Recently, Korean air and Asiana airlines have established budget airlines called Jin air and Air Busan, respectively, to confront the launching of budget airlines such as Hansung airline and Jeju air, among others. In addition, as more online bookstores have entered the market, a leading off-line bookstore Kyobo began its own online bookstore. Through fighting brands, an incumbent with a high-quality product can increase profits by producing an additional low-quality product when its low-quality product is more differentiated from that of the entrant than is its high-quality product.

• IE interfaces
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• v.21 no.1
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• pp.18-32
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• 2008

In recent, a general trend is observed towards more customized products and shorter product life cycles in manufacturing companies. In these companies, customers often wish to influence the product they order and to get a variant of product that meets their requirements. This environment is called as a customer-oriented manufacturing companies. This paper presents a procedure of product specification management for customer-oriented manufacturing companies by using product specification framework. This framework is founded on the product specification based product structure which is made of model, specification, function, and part. Also, a product specification management system(PSMS) is implemented by using the proposed product specification framework and is a core system in product data integration system. To illustrate an utilization of the proposed framework and procedure, a case of a ship engine product is applied. As a result, PSMS reduces delivery time and improves customer relationships. Moreover, the case shows that PSMS can be used as a tool for improving inter-department coordination within a company during product life cycle.

• Journal of the Korean Society for Precision Engineering
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• v.17 no.8
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• pp.140-150
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• 2000

In this paper module of a product is determined by the characteristics of a product itself and process. To analyze the characteristics of the product information on subassemblies and parts can be obtained by analyzing the existing product. Based on the analysis of characteristics of product structure and function determination rules of a module degree could be proposed for assembly and disassembly process and product structure and function. By applying these rules of a module, module of a product is classified into full half and non-module depending on the module degree of a product. As a result of module degree analysis simpler assembly process and reduced structural interference can be realized. For the product function simpler updated and multi function can be also achieved.

• Proceedings of the Korean Society for Technology of Plasticity Conference
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• 2003.05a
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• pp.371-374
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• 2003

The bending process for the "ㄱ" section product can be developed by the hot metal extrusion machine with the two punches moving in the different velocity. The bending phenomenon can be controlled by difference of velocity at the die exit section by the different velocity of billets through the two-hole container. The results of the experiment show that "ㄱ" section product can be bended by the extrusion process and that the curvature of the product can be controlled by the velocity of punch and that the defects such as the distortion of section and the thickness change of the product and the folding and wrinkling of the product did not happen after the bending processing by the extrusion bending machine.

• Korean Journal of Computational Design and Engineering
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• v.20 no.3
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• pp.254-262
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• 2015

This study proposes an approach to Product Data Management (PDM) education for collaborative product data management, which can support collaborative product development process. This approach introduces social media and a PDM system into a framework for PDM education supported by consistent product development process and product data model. It has been applied to two PDM classes and the result shows that the social media in PDM education can support not only experiences of the collaborative product data management but also interactive and informal communications among instructors and participants using integrated social media with product data during courses.

• Journal of Distribution Science
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• v.13 no.8
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• pp.81-90
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• 2015

Purpose - To vitalize a market or develop a new one, companies frequently release new products into the market, often by shortening the time to market, called the release period. This research aims to investigate the purchase intention behavior of consumers in terms of buying new products at the time of product release based on the release speed. Research Design, Data, and Methodology - The research reviews the influence of relative advantage, complexity, and compatibility among innovative attributes of new products, as proposed by Rogers. Moreover, it examines the moderating effect of the innovative new product attributes in terms of speed of obsolescence of old products and how that influences consumer purchase behavior. Additionally, this study tests the research hypotheses using empirical analysis. Results - The analysis demonstrated that the relative predominance (H1) and suitability (H3) of new products had a statistically significant positive influence on new product purchase intention. However, the complexity (H2) of new products had a statistically significant positive influence on new product purchase intention in contrast to its predicted sign (-). The results of the moderating effect of the old product use period were as follows. H4-1 was not supported since the difference between the path coefficients of the group with the low level old product use period and the group with the high level, represented by the relationship of relative predominance and new product purchase intention, was not statistically significant. H5-1 was also not supported since the difference between the path coefficients of the group with the low level of old product use period and the group with the high level, represented by the relationship of complexity and new product purchase intention, was not statistically significant. However, H4-2 was supported since the difference between the path coefficients of the group with the low level of old product use frequency and the group with the high level, represented by the relationship of relative advantage and new product purchase intention was statistically significant. H5-2 was not supported since the difference between the path coefficients of the group with the low level of old product use frequency and the group with the high level, represented by the relationship of complexity and new product purchase intention, was not statistically significant. H6-2 was also not supported since the difference between the path coefficients of the group with the low level of old product use frequency and the group with the high level, represented by the relationship of compatibility and new product purchase intention, was not statistically significant. Conclusion - According to the results, only H4-2 among the hypotheses on the moderating effect of the old product use period and use frequency was statistically significant. Future research should focus on carrying out a detailed review of the hypothesis on the moderating effect of the old product usage period and frequency, find the cause, and connect this to potential new research.

• Asia pacific journal of information systems
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• v.18 no.3
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• pp.67-90
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• 2008

Prior to making choices among online products and services, consumers often search online product reviews written by other consumers. Online product reviews have great influences on consumer behavior because they are believed to be more reliable than information provided by sellers. However, ever-increasing lists of product reviews make it difficult for consumers to find the right information efficiently. A customized search mechanism is a method to provide personalized information which fits the user's requirements. This study examines effects of a customized search mechanism and perceived similarity between consumers and product reviewers on consumer behaviors. More specifically, we address the following research questions: (1) Can a customized search mechanism increase perceived similarity between product review authors and readers? (2) Are product reviews perceived as more credible when product reviews were written by the authors perceived similar to them? (3) Does credibility of product reviews have a positive impact on acceptance of product reviews? (4) Does acceptance of product reviews have an influence on purchase intention of the readers? To examine these research questions, a lab experiment with a between-subject factor (whether a customized search mechanism is provided or not) design was employed. In order to enhance mundane realism and increase generalizability of the findings, the experiment sites were built based on a real online store, cherrya.com (http://www.cherrya.com/). Sixty participants were drawn from a pool that consisted of undergraduate and graduate students in a large university. Participation was voluntary; all the participants received 5,000 won to encourage their motivation and involvement in the experiment tasks. In addition, 15 participants, who selected by a random draw, received 30,000 won to actually purchase the product that he or she decided to buy during the experiment. Of the 60 participants, 25 were male and 35 were female. In examining the homogeneity between the two groups, the results of t-tests revealed no significant difference in gender, age, academic years, online shopping experience, and Internet usage. To test our research model, we completed tests of the measurement models and the structural models using PLS Graph version 3.00. The analysis confirmed individual item reliability, internal consistency, and discriminant validity of measurements. The results show that participants feel more credible when product reviews were written by the authors perceived similar to them, credibility of product reviews have a positive impact on acceptance of product reviews, and acceptance of product reviews have an influence on purchase intention of the readers. However, a customized search mechanism did not increase perceived similarity between product review authors and readers. The results imply that there is an urgent need to develop a better customized search tool in order to increase perceived similarity between product review authors and readers.

• Journal of Korean Society for Quality Management
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• v.47 no.3
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• pp.509-522
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• 2019

Purpose: The purpose of this study is to analyze how the writing rules of the product user guide affect consumers' understanding of products and the prevention of product accidents. Methods: We surveyed consumers to see how the writing rules of the product user guide help consumers to understand products and prevent product accidents. Results: We derived the importance, necessity, usability, and readability of the principle of making product manuals through analysis of previous research. Usability is the writing rule of the product user guide that the consumer has the most influence on the understanding of product use and the product accident. Conclusion: It is necessary to make product user guide so that consumers can understand the function and safety of products by using video and various image media. Also, It is the obligation to explain all stages of the product and to communicate through the product user guide how to prevent the product accident step by step.

• Proceedings of the Technology Innovation Conference
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• 2005.06a
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• pp.44-68
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• 2005

The purpose of this paper is to analyze the organizational design and management of product development in creating new product architecture by an established firm. For the purpose, the paper put up the organizational design in the process of PDA(Personal Digital Assistant) development of Sharp and Casio which were Japanese major PDA firms in 1990s. PDA is the product born through architectural change from Electronic Organizer. Prior research on the product architecture change and organizational adaptation emphasized that an established firm is difficult to adapt to new product architecture due to the restriction of prior technology or organizational inertia. For overcoming these problems and successful development of new product architecture, organizational design and management in the process of product development becomes essential. In case of Sharp, corporate development project team had been used to overcome the restrictions from architectural knowledge accumulated through previous product. After launching first new PDA by corporate development project team, Sharp created a new division and pushed an evolution of PDA, when new PDA market start to grow up rapidly toward a major market segmentation. As a result, Sharp was able to build up stable PDA project trajectory. However, Casio was late for three years in launching of new PDA architecture because previous division charging of Electronic Organizer tried to develop first new PDA. Casio's PDA development was prohibited by engineers of previous division because new PDA architecture was inferior on user interface and display definition. That is, Casio's first PDA development was restricted by architectural knowledge of previous product.

• Journal of the Korean Institute of Gas
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• v.7 no.4 s.21
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• pp.30-35
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• 2003

Product liability(PL) law imposes the liability on manufacturer or wholesaler when the product defects cause harm to consumers of the products or any other parties in their lives, bodies, or properties. In Korea, the law of product liability was enforced in July 2002. In this study the Product Liability Response System of chemical products was developed by using Failure Mode and Effect Analysis(FMEA). For a case study peformed for N,N-Dimethylethylamine. First, product information was gathered through Material Safety Data Sheet(MSDS)and which considered as an instruction manual of chemical product. And an effect caused by product defects is analyzed by FMEA to get Risk Priority Number(RPN) which is calculated by multiplying of severity, occurrence, and detection of the defects. Then hazard was estimated quantitatively by RPN.