Pricing Behavior of Consumer Innovators
(A2019-9986)

AUTHORS

Tobias Ebbing, Technical University Hamburg; Christian Lüthje, Technical University Hamburg

KEYWORDS

Consumer Innovation; Pricing; Game Development

ABSTRACT

The household sector (HHS) predominantly innovates out of non-commercial motives. Marketization comes with high opportunity costs, hence found rare interest amongst HHS-innovators and accordingly research too. With virtual marketplaces and more HHS-Innovations this is changing. We empirically show that, in terms of pricing, the HHS does marketize differently than established firms: (1) they charge less for products of similar value (2) in line with that, they charge less for additional costs than firms (3) they are trained in estimating the perceived value of a product and, other than firms, set their prices accordingly (4) they are more sensitive towards competitors pricing pressure. Our results contribute to (A) marketing research by examining the applicability of known concepts on new market entities (B) Innovation Research by understanding how the HHS commercializes and diffusion costs can be recovered and (C) practice by examining behaviors of a new type of competitor.