Customers' migration paths decided by relative advantage: longitudinal and comparative case study of successive generations of logic semiconductor technology

Abstract

Understanding customers and their behaviour has become important for success in a market. When successive generations of technology are available in a market, customers will decide their migration paths based on certain factors. This study focused on the relative advantage of successive generations positioned at different levels. Based on a longitudinal and comparative research design, the migration paths of customers are identified by understanding how their behaviours are affected by this relative advantage. The preferred relative advantage is positioned differently at early and majority markets. According to observations of the actual migration paths of 14 semiconductor customers, early and majority market players exhibit different migration paths (switching, new entrance, leapfrogging, or diffusion paths) depending on the relative advantage of the migrating generation. This study has theoretical implications by understanding the mechanism of customers' migration based on the relative advantage, as well as practical implications for suppliers and customers to sustain their competitive advantage in a market.