Factors affecting consumer adoption of product innovation: a review of literature

In the present business environment, product innovation has become an imperative for the business firms to grow and survive in the long run by providing their customers what they want in the form of new and improved products. But there always exist a gap as to what customers want and what businesses perceive they want. Business firms develop product by taking into account their perception of customers’ needs and wants which might be different from the actual needs of the customers. Also, a large number of geographic, demographic, cultural, socio-economic and psychographic factors influence the buying behaviour of consumers leading to either adoption or rejection of an existing or a new product. As a result of these factors, not all product innovations are welcomed by the consumers. Hence, this paper presents a review of literature to highlight the major factors affecting consumer attitudes towards product innovation and how they lead to the adoption or rejection of new and improved products by the consumers.