So what does that mean for our business? It means that the innovators and the early adopters really bring in the early majority, the bulk of our business. They give us signs on what's our likely scale, what we should get right, what we should do less of, and so on. They've taken the leap of faith with our products, so we also love them more, and rightfully so.
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| Everett M. Rogers' Diffusion of Innovations 1962 |
a) People do not fall into one Change Adoption Category; they drift from category to category depending on the specific change/innovation. There are no people who are always early adopters in every category, and
b) The statement "13.5% of the general population are Early Adopters" makes two related and dangerous assumptions.
a. complete Adoption Curve will exist for any change..
b. It assumes 13.5% of us will embrace any change,
Evidence of the incorrectness of this statement is found in two casual observations, he says;
a) At the height of the Hula Hoop craze, not everyone was hula-hooping
b) Not even 2.5% of the population have bought a Segway
The adoption terms are accurate only in hindsight; they tell you nothing about how a population might respond to a change/innovation.
I found it very insightful and enlightening. In addition, I wanted to highlight something I've been trying to convince various companies on for a while. It may not be just useless to listen too literally to your early adopters, it could also be dangerous. It's like entering the weld-shop without the safety goggles and here's why.
The early adopters are called out as a separate segment in all these studies because they are different. How different? Sufficiently different to be called out separately from the majority. They think and act differently and look for different things in products or services. What may be really cool and worth paying for, for this community, may still be cool, but not worth paying for by the early majority. Concorde stands out as an example, but that probably deserves a separate dedicated post.
Peter's examples on the Hula Hoop and Segway are appropriate to think about here. One of our current struggles in eCommerce now is the same. Less than 1% of the opportunity has happened in India, there is temptation but not logic to extrapolate our learning to the entire potential community. It could be okay to do in Durables or Telecom where more than half the potential population has been onboarded. But in nascent industries, there is really no reason to believe that the other 99% will behave like this 1%.
Very true. Extrapolating from the 1% is risky. But businesses do need to be able to make some sort of quasi-informed decision that is predicated on how a population greater than the initial 1% will behave. So what to do?
ReplyDeleteWe understand that the 1% we see might be a biased sample, so that begs the question: what caused the bias? Why is there only 1% of the population in the eCommerce consumer space right now? Maybe that will give some clues?
Yes, you're right. There needs to be a basis for assumptions/ projections. What one should do, I believe, apart from calling out the risk that the early results may not be representative, is two things - one build adoption scenarios and two, keep updating assumptions and course correcting business plans as they play out.
ReplyDeleteThe first 1% in the cycle explore, seek risk, value the 'new' more, have money to spare and so on. Essentially their cost / benefit of trial is different from the more conservative early majority. I think there's just 1% on eCommerce now mainly because it is still a fairly recent phenomenon in a meaningful way, and the cost-benefit of switching, compared to the social, face-to-face options we have, is different from other countries. Modern Retail also faces a similar challenge in adoption.