Understanding the Diffusion of Innovations
Most technology companies that develop new products are no doubt familiar with the Diffusion of Innovations theory or at least have heard of it.
Former Professor Everett M. Rogers did a lot of research on this topic, was a leading authority on diffusion of innovations and wrote the landmark book titled, Diffusion of Innovations. His research included hundreds of studies. He also had previous research to draw from including earlier work by sociologists Bryce Ryan and Neal Gross, among others.
This theory analyzes how new product innovations come to market. Diffusion takes a look at the big picture and process that occurs in support of spreading the word about innovation and the rate by which innovation is accepted, while adoption considers the personal steps an individual goes through to buy the new item. It also encompasses the different buying stages discussed in this post.
In order for a new innovation to be widely accepted, it requires human capital, acceptance and time. It also needs someone to actively shepherd its message through the use of mass media, opinion leaders, influencers, personal communication, word of mouth, networking, social media, online communities and more.
People fall into different categories and possess various levels of innovation acceptance based on their makeup, profession, risk aversion, environment, and more. But even further, Rogers identified five elements that influence the decision making process for adoption. Listed here, are the five factors that he first laid out followed by his modification in a later edition of his book. These original and amended influencers are awareness/knowledge, interest/persuasion, evaluation/decision, trial/implementation and adoption/confirmation.
Adoption starts off slow as pricing can often be high at the outset to help recover development costs, but also because awareness and interest can be low. Time is needed to inform and educate the public about the new innovation and to help garner interest to move them along the adoption curve. But time can mean slow adoption as well. On the other end of the spectrum are “laggards.” These people often hold off as long as possible and only buy once they feel the need to adapt and fit into society. A good example of this would be those who resisted for years to buying a cell phone.
Specifically, the aspects identified for enabling diffusion are:
Innovation – The new product, service, or idea.
Adopters – The groups, individuals, organizations or buyers.
Communication Channel – How the message is delivered to the public and buyers. The communication platforms used.
Time – How long it takes for the innovation to get adopted by the buying public.
Social System – The combined network of influencers, relationships, and roles.
Professor Rogers outlined the following adoption categories for innovation using a Bell curve:
1) Innovators – 2.5% - Usually risk takers, with a passion for new items. High social status and excessive capital to spend on new innovation.
2) Early Adopters – 13.5% - Opinion leaders also with high social status, finances to spend on new innovation, highly educated and informed.
3) Early Majority – 34% -- A bit more cautious and pragmatic, they're inclined to listen to opinion leaders for input and evaluation.
4) Late Majority – 34% -- Skeptical of innovation. They're from lower social status and incomes. They rely more on word of mouth and conversation than opinion leaders.
5) Laggards – 16% -- They prefer the status quo and tradition. Often older, less informed, lower income status, and tend to rely on friends and family to persuade them to buy.
It's important to note that decisions for buying are typically made from three different buying groups: Individuals, a group of people, or someone with authority as a decision maker. Also included in this influence network are gatekeepers, opinion leaders as stated above, and change agents.
And finally, let’s consider Geoffrey A. Moore’s excellent book, Crossing the Chasm, where he articulates that there’s a chasm between Early Adopters (those who see themselves as technology enthusiasts) and Early Majority (those who are a bit more cautious than Early Adopters). The book explains that marketers need to develop a cohesive marketing plan to break through and shrink the chasm, and this can be done by identifying a true target market, positioning to this audience, and creating an appropriate sales and marketing strategy. This of course is crucial given the expanded buyers pool in the Early Majority category; quite essential as companies strive to hit critical mass in generated sales.
The key point from all this is to understand that diffusion of innovations requires a process and a social system to support its adoption. It’s imperative as technology marketers to understand the steps and influences that persuade individuals and organizations in their acceptance within the buying process so that we can communicate to them appropriately.