Abstract
Understanding the impact of engineering design on product competitions is imperative for product designers to better address customer needs and develop more competitive products. In this paper, we propose a dynamic network-based approach for modeling and analyzing the evolution of product competitions using multi-year buyer survey data. The product co-consideration network, formed based on the likelihood of two products being co-considered from survey data, is treated as a proxy of products’ competition relations in a market. The separate temporal exponential random graph model (STERGM) is employed as the dynamic network modeling technique to model the evolution of network as two separate processes: link formation and link dissolution. We use China’s automotive market as a case study to illustrate the implementation of the proposed approach and the benefits of dynamic network models compared to the static network modeling approach based on an exponential random graph model (ERGM). The results show that since STERGM takes preexisting competition relations into account, it provides a pathway to gain insights into why a product may maintain or lose its competitiveness over time. These driving factors include both product attributes (e.g., fuel consumption) as well as current market structures (e.g., the centralization effect). With the proposed dynamic network-based approach, the insights gained from this paper can help designers better interpret the temporal changes of product competition relations to support product design decisions.
References
1.
Christensen
, C.
, 1997
, “Patterns in the Evolution of Product Competition
,” Eur. Manage. J.
, 15
(2
), pp. 117
–127
. 10.1016/S0263-2373(96)00081-32.
Bloomberg News
, 2018
, “American Automakers Losing Ground in a Shrinking Chinese Market
,” Bloomberg.com3.
Moss
, T.
, and Colias
, M.
, 2019
, “Ford’s Shrinking China Business Is Hurting Its Global Ambitions
,” Wall Street Journal
[Online], https://www.wsj.com/articles/fords-slowing-china-business-is-creating-roadblocks-for-its-global-ambitions-115637878014.
Turrentine
, T. S.
, and Kurani
, K. S.
, 2007
, “Car Buyers and Fuel Economy?
,” Energy Policy
, 35
(2
), pp. 1213
–1223
. 10.1016/j.enpol.2006.03.0055.
Heffner
, R.
, Kurani
, K. S.
, and Turrentine
, T. S.
, 2007
, “Symbolism in Early Markets for Hybrid Electric Vehicles
,” Technical Report No. UCD-ITS-RR-07-01
, Institute of Transportation Studies, University of California
, Davis, CA
.6.
Talay
, M. B.
, Calantone
, R. J.
, and Voorhees
, C. M.
, 2014
, “Coevolutionary Dynamics of Automotive Competition: Product Innovation, Change, and Marketplace Survival
,” J. Prod. Innov. Manage.
, 31
(1
), pp. 61
–78
. 10.1111/jpim.120807.
Roberts
, P. W.
, 1999
, “Product Innovation, Product–Market Competition and Persistent Profitability in the US Pharmaceutical Industry
,” Strateg. Manage. J.
, 20
(7
), pp. 655
–670
. 10.1002/(SICI)1097-0266(199907)20:7<655::AID-SMJ44>3.0.CO;2-P8.
Gandal
, N.
, 2001
, “The Dynamics of Competition in the Internet Search Engine Market
,” Int. J. Ind. Org.
, 19
(7
), pp. 1103
–1117
. 10.1016/S0167-7187(01)00065-09.
Chisholm
, D. C.
, and Norman
, G.
, 2012
, “Market Access and Competition in Product Lines
,” Int. J. Ind. Org.
, 30
(5
), pp. 429
–435
. 10.1016/j.ijindorg.2012.04.00310.
Medhin
, N. G.
, and Wan
, W.
, 2009
, “Multi-New Product Competition in Duopoly: A Differential Game Analysis
,” Dyn. Syst. Appl.
, 18
(2
), p. 161
.11.
Wang
, M.
, Sha
, Z.
, Huang
, Y.
, Contractor
, N.
, Fu
, Y.
, and Chen
, W.
, 2018
, “Predicting Products’ Co-Considerations and Market Competitions for Technology-Driven Product Design: A Network-Based Approach
,” Des. Sci.
, 4
, p. E9
.12.
Sha
, Z.
, Huang
, Y.
, Fu
, S.
, Wang
, M.
, Fu
, Y.
, Contractor
, N.
, and Chen
, W.
, 2018
, “A Network-Based Approach to Modeling and Predicting Product Co-Consideration Relations
,” Complexity
, 2018
, pp. 1
–14
.13.
Robins
, G.
, Pattison
, P.
, Kalish
, Y.
, and Lusher
, D.
, 2007
, “An Introduction to Exponential Random Graph (P*) Models for Social Networks
,” Soc. Netw.
, 29
(2
), pp. 173
–191
. 10.1016/j.socnet.2006.08.00214.
Wang
, M.
, Chen
, W.
, Huang
, Y.
, Contractor
, N. S.
, and Fu
, Y.
, 2016
, “Modeling Customer Preferences Using Multidimensional Network Analysis in Engineering Design
,” Des. Sci.
, 2
, pp. 1
–28
. 10.1017/dsj.2016.1115.
Snijders
, T. A. B.
, Pattison
, P. E.
, Robins
, G. L.
, and Handcock
, M. S.
, 2006
, “New Specifications for Exponential Random Graph Models
,” Sociol. Method.
, 36
(1
), pp. 99
–153
. 10.1111/j.1467-9531.2006.00176.x16.
Wang
, M.
, Sha
, Z.
, Huang
, Y.
, Contractor
, N.
, Fu
, Y.
, and Chen
, W.
, 2016
, “Forecasting Technological Impacts on Customers’ Co-Consideration Behaviors: A Data-Driven Network Analysis Approach
,” ASME 2016 International Design Engineering Technical Conferences and Computers and Information in Engineering Conference
, Charlotte, NC
, Aug. 21–24
, p. V02AT03A040
.17.
Wang
, M.
, Chen
, W.
, Fu
, Y.
, and Yang
, Y.
, 2015
, “Analyzing and Predicting Heterogeneous Customer Preferences in China’s Auto Market Using Choice Modeling and Network Analysis
,” SAE Int. J. Mater. Manuf.
, 8
(3
), pp. 668
–677
. 10.4271/2015-01-046818.
Fu
, J. S.
, Sha
, Z.
, Huang
, Y.
, Wang
, M.
, Fu
, Y.
, and Chen
, W.
, 2017
, “Two-Stage Modeling of Customer Choice Preferences in Engineering Design Using Bipartite Network Analysis
,” Proceedings of the ASME 2017 International Design Engineering Technical Conferences and Computers and Information in Engineering Conference
, Cleveland, OH
, Aug. 6–9
, pp. DETC2017-68099
, V02AT03A03.9
.19.
Hanneke
, S.
, Fu
, W.
, and Xing
, E. P.
, 2006
, “Discrete Temporal Models of Social Networks
,” 23rd International Conference on Machine Learning
, Pittsburgh, PA
, June 25–29
.20.
Krivitsky
, P. N.
, and Handcock
, M. S.
, 2014
, “A Separable Model for Dynamic Networks
,” J. R. Stat. Soc. Ser. B Stat. Methodol.
, 76
(1
), pp. 29
–46
. 10.1111/rssb.1201421.
Watts
, D. J.
, and Strogatz
, S. H.
, 1998
, “Collective Dynamics Of ‘small-World’ Networks
,” Nature
, 393
(6684
), pp. 440
–442
. 10.1038/3091822.
Barabási
, A.-L.
, and Albert
, R.
, 1999
, “Emergence of Scaling in Random Networks
,” Science
, 286
(5439
), pp. 509
–512
. 10.1126/science.286.5439.50923.
Xu
, K. S.
, and Hero
, A. O.
, 2013
, “Dynamic Stochastic Blockmodels: Statistical Models for Time-Evolving Networks
,” International Conference on Social Computing, Behavioral-Cultural Modeling, and Prediction
, Washington, DC
, Apr. 2–5
, pp. 201
–210
.24.
Block
, P.
, Koskinen
, J.
, Hollway
, J.
, Steglich
, C.
, and Stadtfeld
, C.
, 2018
, “Change We Can Believe In: Comparing Longitudinal Network Models on Consistency, Interpretability and Predictive Power
,” Soc. Netw.
, 52
, pp. 180
–191
. 10.1016/j.socnet.2017.08.00125.
Snijders
, T. A. B.
, van de Bunt
, G. G.
, and Steglich
, C. E. G.
, 2010
, “Introduction to Stochastic Actor-Based Models for Network Dynamics
,” Soc. Netw.
, 32
(1
), pp. 44
–60
. 10.1016/j.socnet.2009.02.00426.
Leifeld
, P.
, and Cranmer
, S. J.
, 2015
, “A Theoretical and Empirical Comparison of the Temporal Exponential Random Graph Model and the Stochastic Actor-Oriented Model
,” Radiochimica Acta
, 94
(2
), pp. 679
–682
. 10.1524/ract.2006.94.9-11.67927.
Mousavi
, R.
, and Gu
, B.
, 2015
, The Effects of Homophily in Twitter Communication Network of U.S. House Representatives: A Dynamic Network Study
. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=266605228.
Lebacher
, M.
, Thurner
, P. W.
, and Kauermann
, G.
, 2018
, “International Arms Trade: A Dynamic Separable Network Model With Heterogeneity Components
,” arXiv1803.02707
.29.
Wang
, M.
, and Chen
, W.
, 2015
, “A Data-Driven Network Analysis Approach to Predicting Customer Choice Sets for Choice Modeling in Engineering Design
,” ASME J. Mech. Des.
, 137
(7
), p. 71410
. 10.1115/1.403016030.
Hunter
, D. R.
, Handcock
, M. S.
, Butts
, C. T.
, Goodreau
, S. M.
, and Morris
, M.
, 2008
, “ERGM: A Package to Fit, Simulate and Diagnose Exponential-Family Models for Networks
,” J. Stat. Softw.
, 24
(3
), p. nihpa54860
. 10.18637/jss.v024.i0331.
Lusher
, D.
, Koskinen
, J.
, and Robins
, G.
, 2012
, Exponential Random Graph Models for Social Networks: Theory, Methods, and Applications
, Cambridge University Press
, Cambridge
.32.
Han
, J.-D. J.
, Bertin
, N.
, Hao
, T.
, Goldberg
, D. S.
, Berriz
, G. F.
, Zhang
, L. V.
, Dupuy
, D.
, Walhout
, A. J. M.
, Cusick
, M. E.
, Roth
, F. P.
, and Vidal
, M.
, 2004
, “Evidence for Dynamically Organized Modularity in the Yeast Protein–Protein Interaction Network
,” Nature
, 430
(6995
), pp. 88
–93
. 10.1038/nature0255533.
Conaldi
, G.
, and Lomi
, A.
, 2013
, “The Dual Network Structure of Organizational Problem Solving: A Case Study on Open Source Software Development
,” Soc. Netw.
, 35
(2
), pp. 237
–250
. 10.1016/j.socnet.2012.12.00334.
Tsamardinos
, I.
, and Borboudakis
, G.
, 2010
, “Permutation Testing Improves Bayesian Network Learning
,” Joint European Conference on Machine Learning and Knowledge Discovery in Databases
, Barcelona, Spain
, Sept. 19–23
.35.
Hu
, M.-C.
, Pavlicova
, M.
, and Nunes
, E. V.
, 2011
, “Zero-Inflated and Hurdle Models of Count Data With Extra Zeros: Examples From an HIV-Risk Reduction Intervention Trial
,” Am. J. Drug Alcohol Abuse
, 37
(5
), pp. 367
–375
. 10.3109/00952990.2011.59728036.
Blanchini
, F.
, Franco
, E.
, and Giordano
, G.
, 2013
, “Structured-LMI Conditions for Stabilizing Network-Decentralized Control
,” 52nd IEEE Conference on Decision and Control
, Florence, Italy
, Dec. 10–13
.37.
Robins
, G.
, Pattison
, P.
, and Woolcock
, J.
, 2004
, “Missing Data in Networks: Exponential Random Graph (P*) Models for Networks With Non-Respondents
,” Soc. Netw.
, 26
(3
), pp. 257
–283
. 10.1016/j.socnet.2004.05.00138.
Snijders
, T. A. B.
, 1991
, “Enumeration and Simulation Methods for 0–1 Matrices With Given Marginals
,” Psychometrika
, 56
(3
), pp. 397
–417
. 10.1007/BF0229448239.
Sha
, Z.
, Bi
, Y.
, Wang
, M.
, Stathopoulos
, A.
, Contractor
, N.
, Fu
, Y.
, and Chen
, W.
, 2019
, “Comparing Utility-Based and Network-Based Approaches in Estimating Customer Preferences for Engineering Design
,” The 21st International Conference on Engineering Design
, Delft, The Netherlands
, Aug. 5–8
, pp. 3831
–3840
.40.
Tan
, P.-N.
, Kumar
, V.
, and Srivastava
, J.
, 2004
, “Selecting the Right Objective Measure for Association Analysis
,” Inf. Syst.
, 29
(4
), pp. 293
–313
. 10.1016/S0306-4379(03)00072-341.
Sha
, Z.
, Wang
, M.
, Huang
, Y.
, Contractor
, N.
, Fu
, Y.
, and Chen
, W.
, 2017
, “Modeling Product Co-Consideration Relations: A Comparative Study of Two Network Models
,” Proceedings of the 21st International Conference on Engineering Design (ICED 17) Vol 6: Design Information and Knowledge
, Vancouver, Canada
, Aug. 21–25
, pp. 3831
–3840
.42.
Stevens
, S. S.
, 1946
, “On the Theory of Scales of Measurement
,” Science
, 103
(2684
), 677
–680
.43.
Kostoulas
, A.
, 2013
, “On Likert Scales, Ordinal Data and Mean Values
” [Online], https://achilleaskostoulas.com/2013/02/13/on-likert-scales-ordinal-data-and-mean-values/44.
Krivitsky
, P. N.
, and Handcock
, M.
, 2018
, “Tergm: Fit, Simulate and Diagnose Models for Network Evolution Based on Exponential-Family Random Graph Models
,” Statnet Proj., R Packag. Version
, Vol. 3
, No. 2
, https//cran.r-project.org/package=tergm45.
Hunter
, D. R.
, 2007
, “Curved Exponential Family Models for Social Networks
,” Soc. Netw.
, 29
(2
), pp. 216
–230
. 10.1016/j.socnet.2006.08.00546.
Akaike
, H.
, 1998
, Selected Papers of Hirotugu Akaike (Editors: Kunio Tanabe, Emanuel Parzen)
, Springer
, New York
, pp. 199
–213
.47.
Saito
, T.
, and Rehmsmeier
, M.
, 2015
, “The Precision–Recall Plot Is More Informative Than the ROC Plot When Evaluating Binary Classifiers on Imbalanced Datasets
,” PLoS One
, 10
(3
), p. e0118432
. 10.1371/journal.pone.011843248.
Flach
, P.
, and Kull
, M.
, 2015
, “Precision–Recall-Gain Curves: PR Analysis Done Right”, Advances in Neural Information Processing Systems
, C.
Cortes
, N. D.
Lawrence
, D. D.
Lee
, M.
Sugiyama
and R.
Garnett
, eds., Curran Associates, Inc.
, Red Hook, NY
, pp. 838
–846
.49.
Roy
, R.
, and Riedel
, J. C.
, 1997
, “Design and Innovation in Successful Product Competition
,” Technovation
, 17
(10
), pp. 537
–594
. 10.1016/S0166-4972(97)00050-350.
Hsu
, Y.
, 2011
, “Design Innovation and Marketing Strategy in Successful Product Competition
,” J. Bus. Ind. Mark.
, 26
(4
), pp. 223
–236
. 10.1108/0885862111112697451.
Opsahl
, T.
, Agneessens
, F.
, and Skvoretz
, J.
, 2010
, “Node Centrality in Weighted Networks: Generalizing Degree and Shortest Paths
,” Soc. Netw.
, 32
(3
), pp. 245
–251
. 10.1016/j.socnet.2010.03.00652.
Wang
, M.
, Chen
, W.
, Huang
, Y.
, Contractor
, N. S.
, and Fu
, Y.
, 2015
, “A Multidimensional Network Approach for Modeling Customer–Product Relations in Engineering Design
,” ASME 2015 International Design Engineering Technical Conferences & Computers and Information in Engineering Conference
, Boston, MA
, Aug. 2–5
, pp. DETC2015-46764
, V007T06A044
.53.
Opsahl
, T.
, 2013
, “Triadic Closure in Two-Mode Networks: Redefining the Global and Local Clustering Coefficients
,” Soc. Netw.
, 35
(2
), pp. 159
–167
. 10.1016/j.socnet.2011.07.001Copyright © 2020 by ASME
You do not currently have access to this content.
