Leapfrogging and profit maximizing new product preannouncement timing
This paper is concerned with the question when to preannounce the introduction of a future product when a company whishes to maximize profits across product life cy-cles. Based on a model proposed by Lilly and Walters (1997) an extended framework is developed to identify the determinants of new product preannouncement timing. Attention is focused on individual buyer's technological leapfrogging and the influ-ence of postponed purchases on optimal new product preannouncement timing. For that purpose a normative model is developed to analyze the influence of the determi-nants of new product preannouncement policy on preannouncement timing decisions.It is shown that optimal preannouncement policy depends on the specific situation of the company and the market it is operating in. Generally, to maximize profits across product life cycles dominating players with product quality advantages should prean-nouncelate whereas smaller suppliers should preannounce early to take advantage of changing market position.