Rethinking the Effect of Perceived Fit on Customers' Evaluations of New Products

Abstract

Prior research has demonstrated that customer evaluations of a new product are directly related to the degree to which a company ` skills are perceived to "fit" with those required to provide the new product. This finding has led to recommendations that firms focus on perceptually close new product areas. However; many firms have successfully entered perceptually distant markets. We reconcile this apparent contradiction by proposing that the effect of perceived fit on new product evaluation is not direct, but is mediated by the certainty a customer has that a company can deliver the proposed new product. Our findings indicate that, by itself perceived fit has a positive impact on industrial product evaluations. However, the relationship between fit and new product evaluations, previously held to be direct, is instead mediated by customer certainty. That is, when the effect of customer certainty is considered, the direct effect of fit disappears. Implications for theory and practice are discussed.