[SOUND] Hi there, welcome to this first video on the adoption of innovations. By adoption, we mean the acceptance of an innovation by people in society or it's specific markets. In this video, we will discuss the adoption life cycle. It's important to have an understanding of this concept. because intervention always implies that something new has been created. Some people are generally open to new things. Many people have difficulty dealing with change and adopting innovation. Think about it. It's quite likely that you own a television. Televisions have been in the world for decades and by now most people in the world have gotten familiar with the concept of watching TV. Most households in the world now own a TV, so you can say that TVs are widely adopted. Other product categories are not that widely adopted. For example, do you own a smart watch? You may own one, but there's a reasonable chance that you don't. Money may play a role here. You may find smart watches too expensive, but still quite a few of you could probably afford a smart watch. Then why don't you own one? Another example is that of a 3D printer that can be used to print physical objects. There are experts that claim that every household will one day own a 3D printer. However, there's a small chance that you have one in your house. Now, why is that? Do you think that they are too expensive for what they currently offer? Or do you perhaps think that they are difficult to use? You may know someone who does own a 3D printer. How can it be that some people adopt a certain innovation, while others do not? Now to get a better understanding of this, we will take a look at the adoption life cycle. The adoption life cycle was introduced by the prominent American scholar, Everett Rogers, in his great book called The Fusion of Innovations. The adoption life cycle represents the number of people that adopt a certain innovation over time, starting at the moment at which an innovation becomes available. The first televisions, for example, became available in the 30s of the 20th century. At the moment that the television was introduced, only a few people acquired one. However, as the steepening of the line in the slide shows, the number of people that adopted a TV at a certain moment grew. Up to the moment at which 50% of potential adopters had acquired a TV. After that, the number of people that acquired a TV for the first time at a certain moment decreased. Now once most people own a TV the adoption rate, of course, becomes really low again. Please be aware that the graph represents the number of people that newly acquire an innovation and not how many owned an innovation. Halfway this graph, 50% of the potential of doctors owned an innovation. After that, the number of people owning a TV further increases but the growth rate decreases. Now, Everett Rogers divided the graph into five sections representing different adopted categories. The first group of people that adopts a certain innovation is referred to as The innovators. Innovators are people that do not have difficulty dealing with the complexity of new technologies or innovations. Think, for example, about the 3D printers. When they were first introduced, they were difficult to use. This also applies to personal computers that we introduced in the 70s of the last century. However, innovators do not care about this complexity. They can easily deal with it, they adopt the innovation, and then focus on the technology. The second category, Early Adopters are not focused on the technology itself, but they are more enthusiastic about potential applications of an innovation. So, if early adopters see an early primitive 3D printer, their imaginations start running wild, and they can see all kinds of applications. This is what excites them, and that is why they are relatively early adopting innovations. The third category is referred to as the Early Majority. The orientation of these people is more practical. They want to see practical proof of how the innovation can be useful to them. The fourth category, the Late Majority, wants to see even more proof. If they purchase a product, they want to be sure that they purchased the product from the firm that has the strongest support system surrounding that new product. And finally the fifth category, the Laggards, are people who generally assess in innovation by themselves. They check whether a certain innovation is interesting to them, or not. However, they are generally skeptical and they accept only a few innovations, and quite often they do not adopt them at all Now, let's take a look at this great cartoon on adoption by Tom Fishburne. The cartoon contains three important elements of the adoption life cycle. First, it shows the five adoptive categories. Second, it shows the stages that an innovation goes through during the adoption life cycle. The innovation is represented by the square figure on top of the curve. Third, the cartoon shows the chasm between the Early Adopters and Early Majority. You can see that the innovator points at the innovation and says wow. Innovators focus on the product and they like it even when it's still in its infancy and not even functioning properly. The Early Adopters find the innovation brilliant and see the opportunities that it offers. The chasm is a gap between the Early Adopters and Early Majority. The idea of the chasm was introduced by the authors Moore and McKenna, who wrote the book Crossing the Chasm. The chasm indicates that there's a big difference between two adaptor categories. Early adaptors are visionaries. And see a potential of an innovation. Even, when it has not fully matured and still has some kinks. The Early Majority, however, needs clarification on how an innovation can be useful to them. Only once the innovation itself becomes more confident, has fewer faults and breaks down less often, only then the Early Majority will consider accepting this innovation. The Early Majority also says, as you can see in the graph, in the picture, I heard Ashton Kutcher has one. Ashton Kutcher is an American actor and might serve as a role model to some people amongst the Early Majority. The Early Majority also finds it important what other people think of a certain innovation. The Early Adopters, however, do not care what other people think about it. If they think something is interesting, they adopt it. The Late Majority only accepts an innovation if it's king of the world. This suggests that they only tend to only adopt something when it's widely accepted and can be considered to be the standard. Finally, the Laggards are not really aware of what is going on. And they're also not very open to innovations in general, even if the innovation is well developed. Here are some other characteristics of the groups, that are on either side of the chasm. The Early Adopters are intuitive. They support revolution, and they followed their own rules. A typical example of an Early Adopter was Steve Jobs, one of the founders of Apple. In contrast to Early Majority, is more analytical. Is more in favor of evolution, so they like slow progress. And they are likely to consult others. Also, the Early Adopters tend to take risks and they're motivated by possible opportunities. They explore what is possible. the Early Majority tends not to take risks, but rather manages risks. They are motivated by solving current problems and instead of exploring what might be possible, They pursue what is probable. They choose for certainty. More generally said, the Early Adopters look with their eyes shut. They are visionaries. And the Early Majority looks with their eyes open. The distinction between Early Adopters and Early Majority is very important for companies.If a company wants to introduce an innovation, initially it needs to get some first market share by building an innovation that is sufficiently attractive for the Innovators and Early Adopters. The company needs to prove the innovation central. The innovation needs to be the best in it's category. It needs to be elegant and it's functionality should be unique. If an intervention matches these criteria, it is likely to be adopted by the Innovators and Early Adopters. Getting these adopter categories on board is essential for opening up the markets and getting that first foot in the market. If the company wants to move to the mainstream market, it has to put the market central. The innovation has to be redesigned and offered in such a way that it can be easily used by the mainstream market. As you may remember, the mainstream market consists of the Early Majority and Late Majority categories. To reach this mainstream market, the company needs to ensure that it has the largest group of customers in its category. Also the innovation should be perceived as current standard. And the quality of customer support around the product needs to be high. The different interests and criteria of the early markets and the mainstream markets require companies to adapt to innovation once they want to cross the chasm and move to the larger and often financially more attractive mainstream market. Steve Jobs in his firm Apple have been very successful in redesigning product categories that only serve in early markets into products that also serve the mainstream markets. In 1977, Steve Jobs saw that many computers were not user friendly. He realized that the interface of the personal computers should be changed. He introduced the graphical interface and the mainstream market adopted these personal computers much more easily. The Apple two was the first successful personal computer. Decades later, they were also very successful in bringing the productivity of tablets to the mainstream market. The introduced the iPads. So, to conclude, you should now know that the adoption life cycle is about the rate at which people tend to adopt an innovation. Potential adopters can be divided into five categories of Innovators, Early Adopters, Early Majority, Late Majority, and Laggards. And this partly alters the questions that they're asked at the start of this video when I was talking about the smart watch and the 3D printer. How can it be that some people adopt a certain innovation while others do not? Well, people fall in different categories and have their own preferences concerning what they look for in innovations You now also know that between the Early Adopters and Early Majority, there is the chasm. The early market of Innovators and Early Adopters is thrilled by the innovation itself or by the opportunities it brings. The mainstream markets can just be convinced to adopt if it is clear how the innovation can be useful to them. And some people may not be interested in innovations at all. If companies want their products to be adopted, they need to take into account each and every factor of the adoption life cycle. Okay, that's it for this video. Next, we'll look into another fascinating topic, the adoption of innovations at the individual level. See you there.
