Technology is accelerating. It took less than a decade for smartphone to go from 1% of the population to almost everyone. Television took longer. The phone even longer.
Anyone who has been in the market for a technology product knows about what I call the “shopper’s dilemma”. Should you buy the current iPhone or wait another six months for an even better iPhone?
It sounds like a form of interest. You either take $1000 to buy the current model, or hold on to your $1000 and buy a much better model in six months. However, there is no free lunch: by waiting you lose access to the current product for six months.
The shopper’s dilemma also applies more broadly.
Consider medical therapies. You could have eye surgery today for a good improvement in your eyesight, or wait in five years for much better surgery giving you great eyesight. Should you wait or should you take whatever is available today? If you are sick and badly in need of treatment, there is no choice. But sometimes you can afford to wait.
The shopper’s dilemma becomes increasingly more challenging as technology accelerates. Its effect is more and more important. The variance also increases: some progress comes suddenly while unexpected setbacks delay long-promised breakthroughs.
How do different people behave when faced with this dilemma?
- Not everyone is aware of the rate of progress. Some people are pessimistic. These people will tend to favour buying now. They are betting against the future. Somewhat ironically, this means that if you work in marketing, you should probably avoid the topic of “progress”.
- Technophiles, or people who follow closely technology, should favour delaying their acquisitions. They are betting on the future being better. I conjecture that they might be more likely to delay purchases or therapies.
It seems that I have a testable conjecture. It should be easy to test?