Friday, July 28, 2006
Innovations – Will They Sell?
Diffusion of innovations is a complex business but Everett M. Rogers, in his seminal work Diffusion of Innovations, identified a number of characteristics that, to great effect, allows one to quickly assess an innovation for its likelihood to successfully diffuse into the marketplace. Here a quick primer on these characteristics.
The characteristics presented by Rogers are all about perception. It is essential to note that it is how the customer perceives these attributes that is important and it is equally important to note that people do not perceive the same thing the same way. Thus, measuring customer perception before during and after development will yield insights into the reasons why people buy or reject innovations.
Here are the five characteristics:
Relative Advantage: If the customer perceives an advantage over the competitors’ offerings, then the product is more likely to diffuse.
Complexity: The more complex the innovation, the less likely a customer is to buy it. In other words, people like things that are easy to use.
Trialability: If the customer can try out the product before they purchase it then they are more likely to buy it. People don’t take salespersons word for it, they want to witness it for themselves – seeing is believing!
Compatibility: People do not like changing their behaviour. They do not like others trying to change their ways. Thus, if your new product is close to the ones that the customer already uses, then they may buy it. If they need to significantly change the way they use the product to do the job they bought it to do, they are not that likely to buy it. The innovation must be consistent with the customers’ values, and their needs and wants.
Observability: If the advantages and benefits of the innovation are clearly visible to the customer then they are more likely to buy it.
These attributes of an innovation are of critical importance to the success of an innovation in the marketplace. Thus, if the characteristics are incorporated into the selection criteria used for deciding which innovations to develop and implement, and which ones are not worth the effort in developing, then you are more likely to have success in the marketplace.
For further information on the diffusion of innovations, visit our Body of Knowledge.
Further Reading:
[1] Rogers E.M., 2003, Diffusion of Innovations, 5ed, Free Press.
[2] Tidd J., Bessant J., Pavitt K., Managing Innovation: Integrating technological, market and organisational change, Wiley.
[3] Goffin K., Mitchell R., Innovation Management: Strategy and implementation using the pentathlon framework, Palgrave Macmillan.
[4] Hart M.A., 2004, How to improve the early sales performance of ‘discontinuous’ innovations-the way Vocera did, Visions [PDMA], Vol. XXVIII No. 2.
The characteristics presented by Rogers are all about perception. It is essential to note that it is how the customer perceives these attributes that is important and it is equally important to note that people do not perceive the same thing the same way. Thus, measuring customer perception before during and after development will yield insights into the reasons why people buy or reject innovations.
Here are the five characteristics:
Relative Advantage: If the customer perceives an advantage over the competitors’ offerings, then the product is more likely to diffuse.
Complexity: The more complex the innovation, the less likely a customer is to buy it. In other words, people like things that are easy to use.
Trialability: If the customer can try out the product before they purchase it then they are more likely to buy it. People don’t take salespersons word for it, they want to witness it for themselves – seeing is believing!
Compatibility: People do not like changing their behaviour. They do not like others trying to change their ways. Thus, if your new product is close to the ones that the customer already uses, then they may buy it. If they need to significantly change the way they use the product to do the job they bought it to do, they are not that likely to buy it. The innovation must be consistent with the customers’ values, and their needs and wants.
Observability: If the advantages and benefits of the innovation are clearly visible to the customer then they are more likely to buy it.
These attributes of an innovation are of critical importance to the success of an innovation in the marketplace. Thus, if the characteristics are incorporated into the selection criteria used for deciding which innovations to develop and implement, and which ones are not worth the effort in developing, then you are more likely to have success in the marketplace.
For further information on the diffusion of innovations, visit our Body of Knowledge.
Further Reading:
[1] Rogers E.M., 2003, Diffusion of Innovations, 5ed, Free Press.
[2] Tidd J., Bessant J., Pavitt K., Managing Innovation: Integrating technological, market and organisational change, Wiley.
[3] Goffin K., Mitchell R., Innovation Management: Strategy and implementation using the pentathlon framework, Palgrave Macmillan.
[4] Hart M.A., 2004, How to improve the early sales performance of ‘discontinuous’ innovations-the way Vocera did, Visions [PDMA], Vol. XXVIII No. 2.
