| New product preannouncement is a strategy in which companies send information about new products to external target groups in the process of research and development of new products or even in the planning process.It has important influence on many aspects such as market position,economic efficiency,and consumer trust.The "cannibalization effect" is the inevitable impact of the company in the process of new products introduction.That is,after the new products are launched,the existing products in the market of their own companies are reduced in price or sales.many researchers have conducted research on the "cannibalization effect" of the new products launch.The relevant theoretical and empirical literature is very rich.However,in the stage of preannouncement of new products,but the"cannibalization effect" caused by the preannouncement of new products still lacks empirical research support.Therefore,this research focuses on an innovative new product preannouncement is how to influence predecessors and consumer behavior on the C2C market platform.We take the 1st generation iPhone preannouncement and launch as a case to examine whether there are cannibalization effects on existing Apple iPod products on eBay.The Difference-in-Differences(DID)Model is applied as the main econometrical analysis methods in this empirical study.We collect the auction listings and bidding records of these products from December 10th 2006 to August 20th 2007(including the date of iPhone preannouncement January 9th 2007 and its launching into the market June 29th 2007)for DID analysis.Our analysis results show that new product introduction cannibalizes other existing products of the same firm.That is,the preannouncement and launching of new product both promote the occurrence of cannibalization.Specifically,new product cannibalizes the most recent version of existing products more significantly than older versions.The managerial implications of the findings are also discussed. |
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