Using cellular automata modeling of the emergence of innovations

Introducing innovations and new products to the market is an essential activity for leading firms. Firms wishing to exploit the advantages of pioneer status strive to attain exclusivity in their discovery of a new market need. Our work introduces some insights relating to the clarification and representation of the dynamics of market awareness of an emerging need. The implications of eliciting knowledge from consumers are discussed, and the probability of competitors attaining “pioneer” status in the market is examined. A low probability of achieving the objective of an exclusive and original discovery of an emerging need via marketing research is indicated. We use Stochastic Cellular Automata to model the collective dynamics grounded in the study of local interactions between agents. Using this paradigm, we show that due to extreme volatility of discovery probabilities concentrated in a short time span, there is a high probability that at least one other competitor will discover the same need before, or concurrently with, its discovery by the firm in question, if traditional exploration is applied. Consequently, a firm is unable to ensure that its discovery of a new need is a singular, pioneering event. A model to assess the odds that the emergent need discovery is exclusive (based on parameters that can be collected during the survey itself) is proposed and evaluated.

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