• Title/Summary/Keyword: Market diffusion

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A Study on the Diffusion Pattern of Mongolian Mobile Market (몽골 이동통신 시장의 확산 패턴 연구)

  • Enkhzaya Batmunkh;Jungsik Hong;TaeguKim
    • Journal of Korean Society for Quality Management
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    • v.51 no.4
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    • pp.691-700
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    • 2023
  • Purpose: This study aims to analyze the diffusion pattern of the Mongolian mobile phone market. In particular, we used a generalized diffusion model to explore the factors affecting market potenial. Methods: We used three diffusion models to estimate the number of mobile subscribers in Mongolia. Based on the Logistic model with the best fitness, we introduced time-varying market potential and explored the influence of various independent variables such as GDP and inflation. Results: Among the basic diffusion models, the Logistic model was the best in terms of estimation performance and statistical significance. The estimation results of the Generalized Logistic model confirm that investment in the telecommunication sector has a significant positive effect on market potential. The estimation of the Generalized Logistic model effectively describes the continuous growth of the Mongolian telecommunications market until recently. Conclusion: We have analyzed the diffusion pattern of the Mongolian telecommunications market and found that the amount of investment in the sector leads to the growth of the market size. This study is original in terms of its subject - Mongolian telecommunications market and methodology - time-varying market potential.

Relationship between Service-Related Activities, Service Capability and Market Diffusion: Case of WiBro

  • Kim, Moon-Koo;Park, Jong-Hyun;Paik, Jong-Hyun
    • ETRI Journal
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    • v.36 no.3
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    • pp.490-497
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    • 2014
  • The market performance of WiBro in Korea has not been as expected, and its rapid diffusion in the near future is unlikely owing to the existence of competing services. There has been little research on the factors affecting this low market diffusion. This study is based on an analytical framework in which a lack of service capability and the insufficiency of service-related activities have resulted in the current poor market performance. An expert survey was conducted on WiBro specialists and verified using the analytical hierarchy process method. The result of this analysis is as follows: underinvestment in network deployment and marketing, insufficient promotional policies, and a shortage of service capabilities are to be analyzed as the main causes of WiBro's low market diffusion.

Analysis and Forecasting of Diffusion of RFID Market in Korea (국내 RFID 시장의 확산 분석 및 예측 모형)

  • Son, Dongmin;Moon, Seonghyeon;Jeong, Bongju
    • Journal of Korean Institute of Industrial Engineers
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    • v.40 no.4
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    • pp.415-423
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    • 2014
  • In recent decades, RFID (Radio Frequency IDentification) technology has been recognized as one of the most core competencies in implementing ubiquitous society. However, Korea has not seen good success in diffusion of RFID even though Korean government continues funding many projects to diffuse the technology in industries. Most previous researches overestimate the growth of Korean RFID market in contrary to real market situation. This study aims to analyze the Korean RFID market and find a reasonable forecasting model for it. Our experimental results show that Bass forecasting model provides the more realistic estimates than any other models and the analyses of forecasting error provide useful information for the better forecasting. We also observed that government policy plays a crucial role in the diffusion of RFID technology in Korea.

Consumer-Agent Based Sensitivity Analysis of Product Diffusion Dynamics for Domestic Automobile Market (국내 자동차 시장에서 소비자 에이전트 모형 기반의 제품 확산 다이나믹스 민감도 분석)

  • Kim, Shin-Tae;Kim, Chang-Ouk
    • Journal of the Korea Society for Simulation
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    • v.20 no.2
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    • pp.29-40
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    • 2011
  • This paper focuses on the sensitivity analysis for the calibration of an agent-based simulation that analyzes the brand-level diffusion dynamics of competing products in the domestic premium mid-sized car market. In this paper, we employ a consumer-agent model that imitates the purchasing characteristics and behaviors of the consumers. The group of consumer agents that are socially interconnected represents a virtual market. By spreading the product information from previous adopters to potential consumer agents in the virtual market, the word-of-mouth phenomenon emerges like in the real market. The phenomenon influences the product choice of potential consumer agents that causes the variation of the product diffusion dynamics. In this simulation model, it is important to calibrate the virtual market parameters(e.g., ratio of innovators, social network structure, purchase time decision method) so that the virtual market can simulate the real market. However, it is difficult to measure these parameters directly from the real market. In this paper, we analyze the diffusion dynamics of simulations under various conditions in comparison with real sales data to calibrate the parameters.

Spatial effect on the diffusion of discount stores (대형할인점 확산에 대한 공간적 영향)

  • Joo, Young-Jin;Kim, Mi-Ae
    • Journal of Distribution Research
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    • v.15 no.4
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    • pp.61-85
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    • 2010
  • Introduction: Diffusion is process by which an innovation is communicated through certain channel overtime among the members of a social system(Rogers 1983). Bass(1969) suggested the Bass model describing diffusion process. The Bass model assumes potential adopters of innovation are influenced by mass-media and word-of-mouth from communication with previous adopters. Various expansions of the Bass model have been conducted. Some of them proposed a third factor affecting diffusion. Others proposed multinational diffusion model and it stressed interactive effect on diffusion among several countries. We add a spatial factor in the Bass model as a third communication factor. Because of situation where we can not control the interaction between markets, we need to consider that diffusion within certain market can be influenced by diffusion in contiguous market. The process that certain type of retail extends is a result that particular market can be described by the retail life cycle. Diffusion of retail has pattern following three phases of spatial diffusion: adoption of innovation happens in near the diffusion center first, spreads to the vicinity of the diffusing center and then adoption of innovation is completed in peripheral areas in saturation stage. So we expect spatial effect to be important to describe diffusion of domestic discount store. We define a spatial diffusion model using multinational diffusion model and apply it to the diffusion of discount store. Modeling: In this paper, we define a spatial diffusion model and apply it to the diffusion of discount store. To define a spatial diffusion model, we expand learning model(Kumar and Krishnan 2002) and separate diffusion process in diffusion center(market A) from diffusion process in the vicinity of the diffusing center(market B). The proposed spatial diffusion model is shown in equation (1a) and (1b). Equation (1a) is the diffusion process in diffusion center and equation (1b) is one in the vicinity of the diffusing center. $$\array{{S_{i,t}=(p_i+q_i{\frac{Y_{i,t-1}}{m_i}})(m_i-Y_{i,t-1})\;i{\in}\{1,{\cdots},I\}\;(1a)}\\{S_{j,t}=(p_j+q_j{\frac{Y_{j,t-1}}{m_i}}+{\sum\limits_{i=1}^I}{\gamma}_{ij}{\frac{Y_{i,t-1}}{m_i}})(m_j-Y_{j,t-1})\;i{\in}\{1,{\cdots},I\},\;j{\in}\{I+1,{\cdots},I+J\}\;(1b)}}$$ We rise two research questions. (1) The proposed spatial diffusion model is more effective than the Bass model to describe the diffusion of discount stores. (2) The more similar retail environment of diffusing center with that of the vicinity of the contiguous market is, the larger spatial effect of diffusing center on diffusion of the vicinity of the contiguous market is. To examine above two questions, we adopt the Bass model to estimate diffusion of discount store first. Next spatial diffusion model where spatial factor is added to the Bass model is used to estimate it. Finally by comparing Bass model with spatial diffusion model, we try to find out which model describes diffusion of discount store better. In addition, we investigate the relationship between similarity of retail environment(conceptual distance) and spatial factor impact with correlation analysis. Result and Implication: We suggest spatial diffusion model to describe diffusion of discount stores. To examine the proposed spatial diffusion model, 347 domestic discount stores are used and we divide nation into 5 districts, Seoul-Gyeongin(SG), Busan-Gyeongnam(BG), Daegu-Gyeongbuk(DG), Gwan- gju-Jeonla(GJ), Daejeon-Chungcheong(DC), and the result is shown

    . In a result of the Bass model(I), the estimates of innovation coefficient(p) and imitation coefficient(q) are 0.017 and 0.323 respectively. While the estimate of market potential is 384. A result of the Bass model(II) for each district shows the estimates of innovation coefficient(p) in SG is 0.019 and the lowest among 5 areas. This is because SG is the diffusion center. The estimates of imitation coefficient(q) in BG is 0.353 and the highest. The imitation coefficient in the vicinity of the diffusing center such as BG is higher than that in the diffusing center because much information flows through various paths more as diffusion is progressing. A result of the Bass model(II) shows the estimates of innovation coefficient(p) in SG is 0.019 and the lowest among 5 areas. This is because SG is the diffusion center. The estimates of imitation coefficient(q) in BG is 0.353 and the highest. The imitation coefficient in the vicinity of the diffusing center such as BG is higher than that in the diffusing center because much information flows through various paths more as diffusion is progressing. In a result of spatial diffusion model(IV), we can notice the changes between coefficients of the bass model and those of the spatial diffusion model. Except for GJ, the estimates of innovation and imitation coefficients in Model IV are lower than those in Model II. The changes of innovation and imitation coefficients are reflected to spatial coefficient(${\gamma}$). From spatial coefficient(${\gamma}$) we can infer that when the diffusion in the vicinity of the diffusing center occurs, the diffusion is influenced by one in the diffusing center. The difference between the Bass model(II) and the spatial diffusion model(IV) is statistically significant with the ${\chi}^2$-distributed likelihood ratio statistic is 16.598(p=0.0023). Which implies that the spatial diffusion model is more effective than the Bass model to describe diffusion of discount stores. So the research question (1) is supported. In addition, we found that there are statistically significant relationship between similarity of retail environment and spatial effect by using correlation analysis. So the research question (2) is also supported.

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  • Applications of Innovation Adoption and Diffusion Theory to Demand Estimation for Communications and Media Converging (DMB) Services (혁신채택 및 확산이론의 통신방송융합(위성DMB) 서비스 수요추정 응용)

    • Sawng Yeong-Wha;Han Hyun-Soo
      • Korean Management Science Review
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      • v.22 no.1
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      • pp.179-197
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      • 2005
    • This study examines market acceptance for DMB service, one of the touted new business models in Korea's next-generation mobile communications service market, using adoption end diffusion of innovation as the theoretical framework. Market acceptance for DMB service was assessed by predicting the demand for the service using the Bass model, and the demand variability over time was then analyzed by integrating the innovation adoption model proposed by Rogers (2003). In our estimation of the Bass model, we derived the coefficient of innovation and coefficient of imitation, using actual diffusion data from the mobile telephone service market. The maximum number of subscribers was estimated based on the result of a survey on satellite DMB service. Furthermore, to test the difference in diffusion pattern between mobile phone service and satellite DMB service, we reorganized the demand data along the diffusion timeline according to Rogers' innovation adoption model, using the responses by survey subjects concerning their respective projected time of adoption. The comparison of the two demand prediction models revealed that diffusion for both took place forming a classical S-curve. Concerning variability in demand for DMB service, our findings, much in agreement with Rogers' view, indicated that demand was highly variable over time and depending on the adopter group. In distinguishing adopters into different groups by time of adoption of innovation, we found that income and lifestyle (opinion leadership, novelty seeking tendency and independent decision-making) were variables with measurable impact. Among the managerial variables, price of reception device, contents type, subscription fees were the variables resulting in statistically significant differences. This study, as an attempt to measure the market acceptance for satellite DMB service, a leading next-generation mobile communications service product, stands out from related studies in that it estimates the nature and level of acceptance for specific customer categories, using theories of innovation adoption and diffusion and based on the result of a survey conducted through one-to-one interviews. The authors of this paper believe that the theoretical framework elaborated in this study and its findings can be fruitfully reused in future attempts to predict demand for new mobile communications service products.

    Valuation of Options in Incomplete Markets (불완전시장 하에서의 옵션가격의 결정)

    • Park, Byungwook
      • Journal of the Korean Operations Research and Management Science Society
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      • v.29 no.2
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      • pp.45-57
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      • 2004
    • The purpose of this paper is studying the valuation of option prices in Incomplete markets. A market is said to be incomplete if the given traded assets are insufficient to hedge a contingent claim. This situation occurs, for example, when the underlying stock process follows jump-diffusion processes. Due to the jump part, it is impossible to construct a hedging portfolio with stocks and riskless assets. Contrary to the case of a complete market in which only one equivalent martingale measure exists, there are infinite numbers of equivalent martingale measures in an incomplete market. Our research here is focusing on risk minimizing hedging strategy and its associated minimal martingale measure under the jump-diffusion processes. Based on this risk minimizing hedging strategy, we characterize the dynamics of a risky asset and derive the valuation formula for an option price. The main contribution of this paper is to obtain an analytical formula for a European option price under the jump-diffusion processes using the minimal martingale measure.

    Forecasting the Evolution of Innovation Considering Consumers' Choice : An Application of Home-Networking Market in Korea (소비자 선택을 고려한 신기술 혁신의 확산 예측: 한국의 홈네트워킹 시장을 대상으로)

    • Lee, Cheol-Yong;Lee, Jeong-Dong;Kim, Yeon-Bae
      • Journal of Technology Innovation
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      • v.13 no.1
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      • pp.1-24
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      • 2005
    • This paper applies a prelaunch forecasting model to the Home-Networking (HN) market of South Korea. The HN market of Korea is categorized into two distinctive markets. One HN market consists of new apartments in which builders install HN and the other HN market consists of existing houses in which residents purchase HN Among these markets, this paper focuses on existing houses as capturing consumers' choice. To forecast sales of HN for existing houses, we use a conjoint model based on our survey data of consumer preferences. By incorporating various indicators of HN technologies into our conjoint model, we also forecast diffusion of HN system embodied in PLC or Wireless Lan. We call this model Choice-Based Diffusion Model. In addition, based on the simulation experiments, we also identify important factors that affect the demands of HN system.

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    Constrained NLS Method for Long-term Forecasting with Short-term Demand Data of a New Product (제약적 NLS 방법을 이용한 출시 초기 신제품의 중장기 수요 예측 방안)

    • Hong, Jungsik;Koo, Hoonyoung
      • Journal of the Korean Operations Research and Management Science Society
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      • v.38 no.1
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      • pp.45-59
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      • 2013
    • A long-term forecasting method for a new product in early stage of diffusion is proposed. The method includes a constrained non-linear least square estimation with the logistic diffusion model. The constraints would be critical market informations such as market potential, peak point, and take-off. Findings on 20 cases having almost full life cycle are that (i) combining any market information improves the forecasting accuracy, (ii) market potential is the most stable information, and (iii) peak point and take-off information have negative effect in case of overestimation.

    Forecasting the Growth of Smartphone Market in Mongolia Using Bass Diffusion Model (Bass Diffusion 모델을 활용한 스마트폰 시장의 성장 규모 예측: 몽골 사례)

    • Anar Bataa;KwangSup Shin
      • The Journal of Bigdata
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      • v.7 no.1
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      • pp.193-212
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      • 2022
    • The Bass Diffusion Model is one of the most successful models in marketing research, and management science in general. Since its publication in 1969, it has guided marketing research on diffusion. This paper illustrates the usage of the Bass diffusion model, using mobile cellular subscription diffusion as a context. We fit the bass diffusion model to three large developed markets, South Korea, Japan, and China, and the emerging markets of Vietnam, Thailand, Kazakhstan, and Mongolia. We estimate the parameters of the bass diffusion model using the nonlinear least square method. The diffusion of mobile cellular subscriptions does follow an S-curve in every case. After acquiring m, p, and q parameters we use k-Means Cluster Analysis for grouping countries into three groups. By clustering countries, we suggest that diffusion rates and patterns are similar, where countries with emerging markets can follow in the footsteps of countries with developed markets. The purpose was to predict the timing and the magnitude of the market maturity and to determine whether the data follow the typical diffusion curve of innovations from the Bass model.


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