Striking the Right Balance: How Familiarity Shapes Consumer Response to Smartphone Innovations

Why It Matters

Developers of digital devices, such as smartphones, face constant pressure to deliver the “next big thing.” Yet not all innovations are equally well received. New research shows that the timing of hardware upgrades and the role of supporting software can determine whether consumers embrace or reject innovations.

Key Takeaways

• Familiar hardware improvements (like better cameras or batteries) are best introduced early, while unfamiliar innovations (like brand-new sensors) fare better when launched later.
• Software support enhances consumer experience with familiar components but may backfire when paired with highly novel features.
• The secret to successful product launches lies in balancing novelty with familiarity.

When Familiar Components Should Go First

Consumers appreciate improvements to features they already understand. Dominant components, such as the CPU, display, or camera, fit this category. Because customers know what “faster,” “clearer,” or “longer battery life” mean, they can easily recognise the value of these upgrades.

The research shows that firms introducing improvements to dominant components early in the market receive stronger consumer evaluations. Early releases set the bar, excite customers, and position the firm as an innovation leader. In contrast, companies that bring such improvements late are often met with disappointment, as rivals may already offer the same enhancements. The study found that lagging behind with dominant upgrades risks being seen as uncompetitive.

Why Novel Features Need Time

By contrast, non-dominant components, such as features that are new and unfamiliar to users, require a different strategy. Examples include adding a heart-rate monitor or face recognition to smartphones when they first emerged.

Consumers often struggle to gauge the usefulness of these novel features, leading to confusion or unmet expectations. When such innovations are introduced too early, they may be poorly understood or even resisted. However, if rolled out later, once consumers have been exposed to them through other devices or word of mouth, evaluations improve. The study shows that a “late follower” approach works better for highly novel innovations, as it leverages growing familiarity in the market.

Software: When It Helps and When It Hurts

Software plays a crucial role in how consumers interact with hardware innovations. When paired with familiar components, software interfaces make improvements tangible and easy to appreciate. For instance, a sharper camera sensor becomes more valuable when paired with an app that allows instant previews or editing. In these cases, software support raises consumer satisfaction.

But for unfamiliar components, software support may inadvertently highlight their complexity, making them feel even harder to grasp. For example, when Apple replaced the fingerprint sensor with Face ID, many consumers were sceptical, citing usability and security concerns. Here, additional software interaction amplified discomfort rather than easing adoption. The study concludes that while software boosts appreciation for familiar upgrades, it can diminish the appeal of radical new features.

Business Implications

The findings carry important lessons for firms in the fast-moving consumer electronics market:

• Sequence matters: Launch familiar improvements early to set industry standards, but introduce unfamiliar innovations later, once customers are ready.
• Support wisely: Use software to showcase and simplify upgrades to familiar components, but avoid overwhelming consumers with software-heavy interfaces for unfamiliar features.
• Balance novelty with familiarity: Striking this balance is key to sustaining consumer satisfaction and product success in a highly competitive environment.

For smartphone makers, this means resisting the urge to be first with every new feature. Instead, the smarter strategy is to lead on the familiar while pacing the introduction of the unfamiliar.

Authors & Sources
Authors: Nila Zhang (Fudan University), Wai Fong Boh (Nanyang Technological University), and Gunwoong Lee (Korea University).
Original article: MIS Quarterly