article

Software Preannouncements and Their Impact on Customers' Perceptions and Vendor Reputation

Author:

John A. HoxmeierAuthors Info & Claims

Journal of Management Information Systems, Volume 17, Issue 1

Pages 115 - 139

Published: 01 June 2000 Publication History

Abstract

Software preannouncements are often called “vaporware” (systems or features announced long before a ship date). The challenge confronting software vendors and consumers is understanding the balance between the need to inform the market and the negative consequences of unfulfilled promises. Based on signaling theory from marketing science and research, this study looks at the perceived importance of software preannouncement factors on customers, of unfulfilled promises and unreliable software on a company's reputation, and whether vendor dependence changes these perceptions. Database administrators were surveyed on the perceptions of their database software vendor. Fulfilling commitments to software functionality was more strongly correlated with vendor reputation than on-time delivery of the software. Customer dependence on the vendor was not correlated with perceptions of vendor reputation and credibility. Thus, unlike other industries, it seems that vendors can use software delivery time preannouncements for competitive purposes with minimal concern for the impact on customers, provided the software ultimately delivers the features and functionality promised and is largely free of errors.

References

[1]

1. Anderson, E., and Weitz, B.A. The use of pledges to build and sustain commitment in distribution channels. Journal of Marketing Research, 29, 1 (February 1992), 18-34.

[2]

2. Banks, J.S., and Sobel, J. Equilibrium selection in signaling games. Econometrica, 55, 3 (May 1987), 647-661.

[3]

3. Boulding, W., and Kirmani, A. A consumer-side experimental examination of signaling theory: do consumers perceive warranties as signals of quality? Journal of Consumer Research, 20, 1 (June 1993), 111-123.

[4]

4. Brandel, W. Late, unstable wares plague IS projects. Computerworld, 28, 21 (May 21 1994), 1, 14.

[5]

5. Brandel, W. Product propaganda battle rages on. Computerworld, 28, 22 (May 30, 1994), 41.

[6]

6. Brockhoff, K.K., and Rao, V. Toward a demand forecasting model for preannounced new technological products. Journal of Engineering and Technology Management, 10, 3 (September 1993), 211-228.

[7]

7. Casselman, G. Vaporware: vile or valid? Computing Canada, 17, 26 (December 19, 1991) 1, 5.

[8]

8. Cho, I., and Kreps, D.M. Signaling games and stable equilibria. Quarterly Journal of Economics, 102, 2 (May 1987), 179-221.

[9]

9. Dawson, S.P. Continuos improvements in action: applying quality principles to software. Information Systems Management, 11, 1 (Winter 1994), 31-39.

[10]

10. Eliashberg, J., and Robertson, T.S. New product preannouncing behavior: a market signaling study. Journal of Marketing Research, 25, 3 (August 1988), 282-292.

[11]

11. Eliashberg, J.; Robertson, T.S.; and Rymon, T. Market signaling and competitive bluffing. Working paper, The Wharton School, University of Pennsylvania (1992).

[12]

12. Engers, M. Signaling with many signals. Econometrica, 55, 3 (May 1987), 663-674.

[13]

13. Engers, M., and Fernandez, L. Market equilibrium with hidden knowledge and self-selection. Econometrica, 55, 2 (March 1987), 425-439.

[14]

14. Famous Vaporware Products. Byte Magazine, September 1995; www.byte.com/art/9509/ sec7/art26.htm, accessed 11/99.

[15]

15. Fitzgerald, T.J. Understanding the differences and similarities between services and products to exploit your competitive advantage. Journal of Services Marketing, 2, 1 (Winter 1988), 25-30.

[16]

16. Foley, M. Vapor: Where? ZDNet, May 20, 1998. http://www.zdnet.com/sr/columns/foley/ 980519.html, accessed 11/11/99.

[17]

17. Fombrun, C., and Shanley, M. What's in a name? Reputation building and corporate strategy. Academy of Management Journal, 33, 2 (June 1990), 233-258.

[18]

18. Foster, E. Vaporware is more than just annoying--it can be downright expensive. Info World, December 1, 1997. http://www.infoworld.com/cgi-bin/displayNew.pl?/foster/ 971201ef.htm, accessed 11/99.

[19]

19. Ganesan, S. Determinants of long-term orientation in buyer seller relationships. Journal of Marketing, 58, 2 (April 1994), 1-19.

[20]

20. Gillin, P. Vaporstriking. Computerworld, 28, 6 (February 7, 1994), 34.

[21]

21. Green, P. Analyzing Multivariate Data. Hinsdale, IL: Dryden Press, 1978.

[22]

22. Hall, R. The strategic analysis of intangible resources. Strategic Management Journal, 13, 2 (February 1992), 135-145.

[23]

23. Hayes, F. Pow! Right in the kisser. Computerworld, February 9, 1998.

[24]

24. Heil, O.P., and Robertson, T.S. Toward a theory of competitive market signaling: a research agenda. Strategic Management Journal, 12, 6 (September 1991), 403-419.

[25]

25. Heil, O.P., and Langvardt, A.W. The interface between competitive market signaling and antitrust law. Journal of Marketing, 58, 3 (July 1994), 81-96.

[26]

26. Heil, O.P., and Walters, R.G. Explaining competitive reactions to new products: an empirical signaling study. Journal of Product Innovation Management, 10, 1 (January 1993), 53-66.

[27]

27. Herbig, P. Market signalling: a review. Management Decision, 34, 1 (1996), 35-45.

[28]

28. Herbig, P., and Milewicz, J. The relationship of reputation and credibility to brand success. Journal of Consumer Marketing, 10, 3 (Summer 1993), 18-24.

[29]

29. Herbig, P.; Milewicz, J.; and Golden, J. A model of reputation building and destruction. Journal of Business Research, 31, 1 (September 1994), 23-31.

[30]

30. Hosage, D.A. Realware v. vaporware. Telecommunications, 19, 2 (February 1985), 65- 66.

[31]

31. Ippolito, P.M. Bonding and nonbonding signals of product quality. Journal of Business, 63, 1 (January 1990), 41-60.

[32]

32. Jenkins, A. Long overdue: the reasons behind vaporware. Computerworld, 22, 40a (October 5, 1988), 11-13.

[33]

33. Johnston, S.J. Vaporware tactics elicit mixed views. Computerworld, 29, 18 (May 1, 1995), 1, 147.

[34]

34. Johnston, S.J., and Betts, M. Industry debates U.S. vaporware probe. Computerworld, 29, 7 (February 13, 1995), 2.

[35]

35. Kay, S. Poor communication equals vaporware. Computerworld, 26, 2 (January 13, 1992), 81-82.

[36]

36. Keefe, P. Microsoft feels heat of FTC investigation. Computerworld, 25, 11 (March 18, 1991), 1, 101.

[37]

37. Keen, P. Instead of the perfect product, how about the perfect supplier? Computerworld, September 14, 1998.

[38]

38. Kihlstrom, R.E., and Riordan, M.H. Advertising as signal. Journal of Political Economy, 92, 31 (June 1984), 427-450.

[39]

39. Kohli, C.S. Signaling new product introductions: a framework to explain the timing of preannouncements. Ph.D. dissertation, Indiana University, 1992.

[40]

40. Lawton, G. Software ship dates under scrutiny. Software Magazine, 15, 1 (January 1995), 26.

[41]

41. Levine, M.S. Canonical Analysis and Factor Comparison. Beverly Hills, CA: Sage, 1967.

[42]

42. Mahmood, M., and Mann, G. Measuring the organizational impact of information technology investment: An exploratory study. Journal of Management Information Systems, 10, 1 (Summer 1993), 97-122.

Digital Library

[43]

43. Margolis, N. Software clan to patrol hype. Computerworld, 24, 42 (October 15, 1990), 1, 8.

[44]

44. McConnell, S. Code Complete: A Practical Handbook of Software Construction. Redmond, WA: Microsoft Press, 1993.

[45]

45. Meachim, N. Users to vendors: quality, quality, quality. Datamation, 40, 12 (June 15, 1994), 38-45.

[46]

46. Milewicz, J., and Herbig, P. Evaluating the brand extension decision using a model of reputation building. Journal of Brand and Product Management, 3, 1 (1994), 1-12.

[47]

47. Milgrom, P., and Roberts, J. Price and advertising signals of product quality. Journal of Political Economy, 94, 4 (August 1986), 796-821.

[48]

48. Nash, K.S. Vendors fudge on product ship dates. Computerworld, 29, 6 (February 6, 1995), 81.

[49]

49. Nunnally, J.C. Psychometric Theory. New York: McGraw-Hill, 1967.

[50]

50. Pressman, R. Software Engineering: A Practitioner's Approach. New York: McGraw-Hill, 1997, p. 7.

[51]

51. Robertson, T.; Eliashberg, J.; and Rymon, T. New product announcement signals and incumbent reactions. Journal of Marketing, 59, 3 (July 1995), 1-15.

[52]

52. Rose, L. Vaporware rules: the limits on dry-testing. Marketing Computers (March 1995). www.webcom.com/~lewrose/article/vapor.html, accessed 11/11/99.

[53]

53. Scannell, E., and Johnston, S. Microsoft tardiness can derail developers. Computerworld, 28, 21 (May 21, 1994), 1, 14.

[54]

54. Shapiro, C. Premiums for high quality products as returns to reputations. Quarterly Journal of Economics, 98, 4 (November 1983), 659-679.

[55]

55. Sherer, P.M. Vendor group vows to improve ethical standards of the industry. PC Week, 7, 41 (October 15, 1990), 157, 164.

[56]

56. Spence, M. A. Market Signaling. Cambridge, MA: Harvard University Press, 1974.

[57]

57. Standish Group. The Chaos Report {Online}, 1997. http://www.standishgroup.com/ chaos.html, accessed 11/11/99.

[58]

58. Stevens, J. Applied Multivariate Statistics for the Social Sciences. Hillsdale, NJ: Lawrence Erlbaum Associates Publishers, 1986.

[59]

59. Stewart, D., and Love, W. A general canonical correlation index. Psychological Bulletin, 70, 3 (1968), 160-163.

[60]

60. Strassmann, P. The road to failure is paved with glib buzzwords. Computerworld, October 5, 1998.

[61]

61. Strong, D.; Lee, Y.; and Wang, R. Data quality in context. Communications of the ACM, 40, 5 (1997), 103-110.

Digital Library

[62]

62. United States v. Microsoft Corporation, 56 F.3d, 1448 1451-52, Civil Action No. 94- 1564, (D.C. Cir. 1995), (Stanley Sporkin) 2/14/95.

[63]

63. Wand, Y., and Wang, R. Anchoring data quality dimensions in ontological foundations. Communications of the ACM, 39, 11 (1996), 86-95.

Digital Library

[64]

64. Weigelt, K., and Camerer, C. Reputation and corporate strategy: A review of recent theory and applications. Strategic Management Journal, 9, 5 (September-October 1988), 443- 456.

[65]

65. Weinberg, N.; Brandel, W.; and Johnston, S.J. Users willing to ride Microsoft juggernaut. Computerworld, 29, 6 (February 6, 1995), 1, 28-29.

[66]

66. Wolinsky, A. Prices as signals of product quality. Review of Economic Studies, 50, 163 (October 1983), 647-658.

[67]

67. Zachary, G.P. We're still waiting. Wall Street Journal, 12, 102 (June 27, 1994), R8.

Cited By

Spruit MAbdat N(2012)The Pricing Strategy Guideline Framework for SaaS VendorsInternational Journal of Strategic Information Technology and Applications10.4018/jsita.20120101033:1(38-53)Online publication date: 1-Jan-2012
https://dl.acm.org/doi/10.4018/jsita.2012010103
McKnight DKacmar CGini MKauffman RSarppo DDellarocas CDignum F(2007)Factors and effects of information credibilityProceedings of the ninth international conference on Electronic commerce10.1145/1282100.1282180(423-432)Online publication date: 19-Aug-2007
https://dl.acm.org/doi/10.1145/1282100.1282180

Software Preannouncements and Their Impact on Customers' Perceptions and Vendor Reputation
1. Applied computing

Recommendations

The Impact of Vaporware, Reliable Software, Vendor Dependence and Fulfilled Promises on Customers‘ Perceptions/Experiences and Vendor Reputation

This study was designed to test two hypotheses:
H1: Reliable software, fulfilled promises and timely delivery of software can positively affect a software vendor‘s reputation and credibility.
H2: Dependence of customers on software vendors and extent of ...
How Does Adoption of the Outlet Channel Impact Customers’ Spending in the Retail Stores: Conflict or Synergy?

We investigate how adoption of a retailer’s factory outlet channel impacts customers’ spending in the retailer’s traditional retail store channel. In recent years, many retailers have added exclusively sourced factory outlet stores into their channel mix ...
The Supply Chain Impact of Smart Customers in a Promotional Environment

Increasing product variety through the use of alternate package sizes is a commonly observed mechanism in the grocery industry. Under such a scheme, however, the response to pricing decisions for each of the different package sizes is affected by how ...

Comments

Information & Contributors

Information

Published In

cover image Journal of Management Information Systems

Journal of Management Information Systems Volume 17, Issue 1

Number 1/Summer 2000

262 pages

Issue’s Table of Contents

Publisher

M. E. Sharpe, Inc.

United States

Publication History

Published: 01 June 2000

Author Tag

Corporate Reputation Signaling Software Preannouncements Vaporware

Qualifiers

Article

Contributors

Other Metrics

View Article Metrics

Bibliometrics & Citations

Bibliometrics

Article Metrics

2
Total Citations
View Citations
23
Total Downloads

Downloads (Last 12 months)0
Downloads (Last 6 weeks)0

Reflects downloads up to 25 Dec 2024

Other Metrics

View Author Metrics

Citations

Cited By

Spruit MAbdat N(2012)The Pricing Strategy Guideline Framework for SaaS VendorsInternational Journal of Strategic Information Technology and Applications10.4018/jsita.20120101033:1(38-53)Online publication date: 1-Jan-2012
https://dl.acm.org/doi/10.4018/jsita.2012010103
McKnight DKacmar CGini MKauffman RSarppo DDellarocas CDignum F(2007)Factors and effects of information credibilityProceedings of the ninth international conference on Electronic commerce10.1145/1282100.1282180(423-432)Online publication date: 19-Aug-2007
https://dl.acm.org/doi/10.1145/1282100.1282180

View Options

View options

Media

Figures

Other

Tables

View Issue’s Table of Contents