Technology Adoption Life Cycle: Popularity in different markets

It is far from being a secret that the technology industry is one of the fastest businesses out there. Paradigms, expectations and needs change as fast as the different companies innovate and offer tons of futuristic products that allow us to experiment things that we have never imagined before and we did not know that we needed so badly until we got them. It is not always easy to keep the other areas of our life (law, culture, customs, etc) aligned with the new technologies on the reach of any person in the world. Technology companies know all this, and they know as well that the only way to keep competitive advantage is to lead innovation of tomorrow with higher standards than yesterday. That is why this industry is so exciting, because since years ago it has only sped up and I do not see it slowing down any time soon.

These characteristics make the technology adoption life cycle a very fast, fragile and particular evolution. A great product is an indispensable start, but it is not enough to hit the ground and become popular enough to reach mass markets without careful implementation and continuous renewal (improvement).


Technology Adoption Life Cycle

In the figure below you can find the product cycle graph divided in 5 stages; the adoption of the technology starts from left and expands towards right as time and product development moves forward until the potential of the product is reached. Some products will reach the “Majority” markets; some will end up dying in the early stages. The “chasm” is a critical and extremely important point to which I will come back in a couple of paragraphs.

Figure 1: Technology Adoption Life Cycle


Stage one is when a product is a new born. It is adopted by techies who want to learn and try a future product. They are willing to try incomplete alpha test products and help with feedback to complete the development in return to access to the newest innovation, however they expect this access for free.

Stage two is when the product has reached a stage when it can be sold to the visionaries who look for competitive advantage and revolutionary breakthrough. They are not very price sensitive and have outstanding imagination for possible applications of the product. They are willing to take the risk of adopt a slightly incomplete product and take responsibility to adapt it to their needs themselves as long as they have rapid time-to-market, high degree of customisation and technical support.

Stage three is the first step to hit mass markets. Pragmatists look for productivity and improvement of their activities, but they need proven application of the technology they will adopt. They want to be mass market leaders owning innovation that is already proven, recommended by trusted sources (visionaries are not trusted sources) and is ready for large implementation with fairly clear product applications, objectives and targets.

Stage four is when mass market is completely achieved. Conservatives adopt the new product to keep competitive advantage and avoid being left behind. They are risk adverse, price sensitive and they will adopt only technologies that have been widely proven and recommended by trustworthy sources. They expect ready-to-use products and value added at minimal extra cost (or no extra cost at all) and with absolutely clear product applications, objectives and targets.

Stage five is just the rest of the market which will be reached only in extremely weird cases. The Sceptics are those who do not really like change and want to keep their life the way it is. They do not believe that the new product will improve their lives and chose to discourage adoption with contrary arguments. They normally do not become a customer at all.


The Chasm

The most critical point among these five stages is called the chasm. This is the point in which the target market of the product changes from visionaries (stage 2) to pragmatist (stage 3). It is this point where the target consumer change from adventurous, risk taker, innovator, big spender, and proud to be different that “the rest” to prudent, risk adverse, expectation driven, budget focused and part of the herd driven. We want to reach this costumer at some point, because they are the mass market that will trigger our product’s revenues to the sky.

The chasm divides two really different target markets and it is really easy to get stuck in it because when a product reaches this point both groups may be discouraged to keep adopting the new product. On one side, visionaries may not be longer interested in the product because they will not be first one to adopt it and the competitive advantage is too low. On the other side, pragmatists will see a product that is still unfinished and not yet adopted by the heard that gives them security and trust.

Crossing the Chasm

When a new product approaches the chasm, it normally is about 80% of what the complete finished product would look like to, that is fine for visionaries, but pragmatists will never be comfortable with it. It might be extremely tempting to try to have a complete product for the whole Pragmatists market to generate the most of revenues in less time. However, there is a high risk that you might end adding only the most common requests to your product and never fulfil one customer’s wish list. This strategy will not bring Pragmatists onboard because they will not accept less than a 100% finished product for them.

Therefore, in order to cross the chasm successfully the product has to be revisited, target a specific segment of the Pragmatists (niche) and be completely finished for that segment. This will allow the product to hit the ground in that particular niche and start generating trustworthy successful stories in the pragmatists’ area. This experience will be used later to expand the product to more niches afterwards.

A “Chasm Crisis” is a series of bad decisions and actions caused by not reaching revenues targets and other commitments. Therefore, it is important to remember that this strategy implies the revenues will not follow the levels of adoption curve shown in the figure, but it will go a lot slower at the beginning catching up as more niches are reached before making commitments and establish targets. From my point of view it is a small price in return of a higher “right of succeed” crossing this important gate.


Done! And now what?

Now: renovation, innovation, evolution, iteration… In a business like the technology industry the only constant is change and all these stages will happen a lot faster than in any other industry. To keep a product growing, it has to be subject of continuous improvement every time it looks like a finished product finding new paradigms and applications. Only so it will stay alive running through stages 1 to 4 over and over and moving forward.

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