Anticipating the Discontinuity In the Technology Adoption Lifecycle Curve: AKA “The Chasm”
The Technology Adoption Lifecycle model (figure 1) predicts how the innovation moves from left to right through the five groups until its useful life is expired. If we follow the logic and framework outlined in last week’s article , one would expect success every time.
Figure 1: Technology Adoption Lifecycle Curve
But something happens along the way on the adoption curve. A discontinuity between the early adopters and early majority occurs, what Geoff Moore calls the chasm (see figure 2).
Moore argues that many companies get so caught up in early market success that they don’t anticipate the chasm, and their products then fail owing to an inability to traverse the gap.
Figure 2: Technology Adoption Lifecycle Curve: The Chasm
What causes the gap?
The problem is that Early Adopters and Early Majority are so different in terms of underlying values as to make communications between them almost impossible. Moore uses the following illustration to understand the difference between the two groups by contrasting the way they use the phrase “I see.”
When visionaries say “I see,” they do so with their eyes closed. That’s how visionaries see
Pragmatists like to see with their eyes open
Pragmatists don’t trust visionaries for the same reason they don’t trust people who want to navigate using the force
Visionaries think Pragmatist are pedestrians
Pragmatist think Visionaries are dangerous
As a result, visionaries, with their highly innovative projects do not make good references for pragmatists, and the market development, instead of gliding across this transition points stalls. The difficulty comes because the Early Majority, by their very nature, need good references before buying into a new technology, and Early Adopters do not make good references.
Unfortunately for many promising new ventures, by the time they reach this transition point, they are often so highly leveraged and resource constrained that any hiccup in sales will throw them into a tailspin – or as Moore calls it, into the chasm.
Crossing the Chasm
The main difference between the visionaries of the early market and the pragmatist in the mainstream is that the former are willing to bet on the come, whereas the latter want to see solutions in production before the buy.
When the visionary sees that you have 80% of the solution to their problem, they are eager to work with you to finish the remaining 20%.
The pragmatist on the other hand expects you to be improving his productivity out of the box and opts to wait till the product is done and ready for prime time. They do not want to invest their resources in working through the final details – that’s your job! They want a 100% solution, what Moore calls the whole product.
Defining a “Whole Product”
A whole product is defined as “the minimum set of products and services necessary to ensure that the target customer will achieve their compelling reason to buy.” Companies get stuck in the chasm because of their inability or unwillingness to commit to taking any whole product all the way through to this level of completion.
The high-tech enterprise, sensing it’s in the chasm, and realizing that the customer needed more than just the bare product itself, sets out to address the problem. But instead of focusing on a single target customer, management targets four or five likely targets with the idea of serving the one segment that caught on first.
There are two problems with this tactic:
First, the companies would visit major customers in each segment and painstakingly extract requirements from across all users to create a product that addressed all key requirements. More often than not, this produced a product that had everything for nobody – it was un-sellable.
The Second problem with the tactic is focusing the limited resources on a scalable opportunity. It’s the old resource constraint issue, too many opportunities, too few resources to execute. It is understandable why companies want to chase as many opportunities that it can at this stage, but that tactic won’t work in the chasm.
Moore states that the key to a winning chasm crossing strategy is to identify a single beachhead of pragmatist customers in a mainstream market segment and accelerate the formation of 100 percent of their product.
The goal is to win a niche foothold in the mainstream as quickly as possible.
This is what Moore calls the bowling pin in the bowling alley. The bowling alley is a period of niche-based adoption in advanced of the general marketplace.
Once you knockdown the first pin, you need to concentrate on an adjacent pins and knock them over, and the next and the next, until enough pins are falling that a tornado happens and the inflection point on the bell curve is reached.
Figure 3: Technology Adoption Lifecycle Curve: The Bowling Alley
Entering the Market Tornado
The tornado is the period of mass market adoption when the general marketplace switches over to the new infrastructure paradigm. (See figure 2 – the Tornado)
Figure 4: Technology Adoption Lifecycle Curve: The Tornado
How Apple Cross The Chasm with the iPod
A great example of crossing the chasm in recent memory was Apple’s success with its iPod. Apple wasn’t the inventor or MP3 players – nor digital music distribution on the internet. But they were the first to formulate a winning strategy to cross the chasm form the early adopter techno nerds into the early majority mainstream.
In my next article I’ll discus how Apple crossed the chasm with iPod by recognizing that the consumer didn’t want MP3 players but rather they want a simple, convenient and fun way to organize and listen to their music libraries on the go. And a simple and exciting way to discover new music, and share it with their friends.
Here’s to safe crossing of the chasm