The role of design in product innovation: a study of design and technical clusters in portable computers

The paper highlights the importance of design in product innovation, using portable computers as an empirical case study. This is an attempt to redress the balance in the innovation and product technology literature, which has overwhelmingly focused on hardware technologies (technical characteristics) of products. Principal components analysis is used to identify clusters of design characteristics and as well as technical characteristics on a data set of portable computer designs in the period 1993 to 1997. The shadow prices which consumers pay for these clusters are then estimated using hedonic price methods. The findings indicate that a limited set of core design and technology characteristics can explain the significant proportion of the demand price for portable computers. The findings have important implications for product innovation management, and the applied methods provide a powerful tool for the measurement and estimation of core design and technical features.