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A business model for launching new products and services

The diffusion of innovation theory was promoted by Everett Rogers in 1962. He argued that any new product would be received in a different way by 5 groups of people:

  • Innovators - a group of people who are always eager to be first to own a new product. These people are risk takers and want to be seen as leaders.

  • Early adopters – this is an educated group of people, often young rather than old. They are leaders in their social environment. 

  • Early majority – as the name of this group suggests, it addresses a mass market where informed people begin to adopt the product.

  • Late majority – eventually the product is accepted by a large but sceptical and traditional group of people, often made up of the lower socio-economic classes.

  • Laggards – when everyone else has accepted the new product, those who have resisted it to the end, finally give in.

Rogers proposed that the distribution of these groups closely follows that which we would expect in a normal bell curve. He split the 5 groups so that half the population is to the left of the curve (people who are early to embrace innovation) and a half is to the right-hand side of the curve (people who embrace innovation at a later stage). However, the classification of the adopters is not symmetrical and there are three categories adopting early and only two adopting late. This is because research shows that innovators and early adopters can be recognised as exclusive groups whereas the laggards are homogeneous.

Diffusion of innovation.JPG

The model only explains the behaviours of a population with regard to a new product. It doesn’t explain how to motivate that population to buy the new product.

Many innovations are the repackaging of old wine in new bottles. These aren’t true innovations in the sense that they are discussed here, they are a presentation of the same product in a different form. Small tweaks and improvements that are made to products are not innovations in the way that they were described by Rogers.

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