Sales practice and market evolution: the case of virtual reality

This paper analyses how sales practices of industry pioneers influence the evolution of a new market - with particular reference to the case of virtua l reality (VR). In the underlying diffusion process, the probability of a n ew user adopting this technology depends on the quality of experience enjoy ed by existing users, Good sales practice is expensive but leads to a high proportion of satisfied users, which is good for subsequent diffusion. Whil e suppliers may be tempted to 'hype up' the technology to obtain additional sales in the short term, those customers persuaded by 'hype' are often dis satisfied with their experiences, and that is bad for diffusion in the long er term. The paper draws on a detailed study of the selling process in VR t o develop a simulation model, which is used to explore how sales practice i nfluences adoption decisions, customer satisfaction and the ultimate evolut ion of the market, (C) 2001 Elsevier Science B.V. All rights reserved.