Product Concept Demonstrations in Trade Shows and Firm Value
Trade shows are a popular venue for firms to demonstrate their portfolio of market-ready new products as well as product concepts under different stages of development. Utilizing auto shows as a context, the authors investigate the effects of concept and product demonstrations on the demonstrating firm's value. Event study results show that abnormal returns follow an inverted U-shaped effect of product development stages: that is, previously demonstrated concepts approaching potential launch have the strongest positive effect, followed by early-stage concepts demonstrated for the first time to the world (i.e., debuts), and then market-ready new products. Trade show locations mediate these effects. The effects of early-stage debut demonstrations appear only when concepts are presented in trade shows located in the home country of the demonstrating firm. However, the effects of displaying previously demonstrated concepts, which have survived product development hurdles, are present in venues within as well as outside the firm's home country.
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- 10.1509/jm.14.0160
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