Everyday a new product is launched and competition to reach customers increase. Did you ever think that each customer is different and has different preference? How the product reaches to the customer? It is not a straight science as it appears because different customer segments need different strategies.
Take the example of Nike shoe brand, presently in every closet you can find a pair of running shoes, trainers and sneakers but it was not the case before. Just about 50 years ago, the running shoes were called expensive German made leather shoes. Nevertheless, in 1964, the “Blue Ribbon Sports” company, founded by Bill Bowerman and Phil Knight, sold shoes which were created with latex and waffle iron to the running competitions.
The early adopters for those shoes were the elite distance runners who participated in the 1972 Olympics. Four out of top seven marathons runners wore the blue ribbon sports shoes in the race and in just 10 year, the Nike shoe became best – seller across America. Gradually the Nike was adopted by the majority of people. But in 1980’s it started developing high performance shoes which was tailored for specific market. Those shoes were innovative and company hired high profile celebrities like John McEnroe for Tennis shoe marketing and Michael Jordan for “Air Jordan” advertisement.
Nike is also a pioneer in understanding the needs of women for their fitness clothing and sense of style. It is now a globally renowned brand in sports shoes, apparels, clothing and sports equipment. It has understood its customer base and different stages needed from attracting early adopters to reaching the mainstream market.
So, what is technology adoption cycle and how people become customers. Let’s find out with the marketing principles such as The Diffusion Process, Technology adoption cycle, and Crossing the chasm.
The Diffusion Process
It describes the five stages educational process which is used to accept new idea and adapt it for individual use. The stages of diffusion are: Awareness, Interest, Evaluation, Trial and adoption.
Awareness Stage – In this stage, people did not know anything about idea apart from the name. For example, customer doesn’t have any clue about new product like how will it work, what will it do etc.
Interest stage – It is the second stage, in this the prospect is curious to know more about the product such as what is it, how does it work, what its potentialities are, how will it benefit me etc.
Evaluation stage – It is a third stage and here, customer makes mental trial of the idea and use all the information gained so far. He then asks questions such as Can I do it? And If I do it will it be better than what I am doing presently? And will it give more value which is important for me?
Trial stage – The audience makes their mind about idea possibilities and tries it. It is usually an experimental stage and questions like how do I use it? When do I use it? How can I make it best work for me?
And after trying the idea or product for some time, the customer gathers enough data concerning him and decision to adopt it or not.
Adoption stage – It is the last stage, it is often characterized by the long term use, continued usage, and gaining satisfaction with the product. It does not guarantee that customer has accepted the idea but assures that he has accepted idea for good and will continue on-going usage.
Now look at the technology adoption lifecycle to understand the different segment of customers.
Technology Adoption Life – Cycle
It defines the customers according to their willingness to accept, use or adopt a new product.
In the “Diffusion of Innovations”, Rogers classified customers as
- Early adopters
- Main Adopters
- Late adopters
Early adopters are those who are excited to try new things or products. Main adopters are group of people who looking into future and get ahead mentality. The late adopters are those people which follow mainstream audience and last one to adopt a product.
This lifecycle is beautifully explained with the Geoffrey Moore’s crossing the chasm theory.
“Crossing the chasm: marketing and selling to the high tech products to mainstream customers” book by Geoffrey A. Moore and it is among the top 10 best-selling marketing books of all time mentioned in the Podcast “The Entrepreneur Library”
In this book, Moore starts with the diffusion of innovation (Rogers) and then describes about the chasm between early adopters and early majority. The early majority adopters comprises of technology enthusiast and visionaries which have very different expectations than early majority (includes pragmatists). He further highlights the strategies to successfully cross the chasm and choosing a target market, understanding the product concept, creating a marketing strategy, and finally choosing most suitable distribution channel and pricing.
Picture Courtesy: http://tjm.org/
However, crossing the chasm is closely related to the idea of technology adoption life-cycle framework in which customers are categorized into five segments: innovators, early adopters, early majority, late majority and laggards.
According to the Moore, the most difficult chasm to cross is between early adopters and early majority. Businesses should follow the pre-chasm approach by targeting particular niche segment and creating the beachhead. In this, target the specific segment, intractable problem which is not solvable by conventional means. Just get something out like minimum viable product in the market as mentioned by ERIC Ries in the lean startup book. Think about how faster I can acquire customers, engage and make it viral to share to attract more new customers. It is aimed to make a tornado effect.
Find some compelling used cases and pull them to attract next segment and henceforth. Post – chasm is a stage where once you cross the chasm. Define your target customers and go after them. It is not like pre chasm where you deal with different types of customers. It is like creating a tornado effect or bust effect which will define your future.
In conclusion, the product adoption is based on the technological adoption life- cycle, diffusion process and crossing the chasm principles. The understanding of technological life-cycle helps to categories different segments and crossing the chasm explains to successfully reach early majority by jumping biggest chasm and building mainstream customer base.