Represents the gulf between two distinct marketplaces for technology products— the first, an early market dominated by early adopters and insiders who are quick to appreciate the nature and benefits of the new development, and the second, a mainstream market representing “the rest of us,” people who want the benefits of new technology but who do not want to “experience” it in all its gory details.
SOLUTION- There are two keys to success here. 1.The first is to have thoroughly thought through the “whole solution” to a particular target end user market’s needs, and to have provided for every element of that solution within the package. This is critical because there is no profit margin to support an afterpurchase.
2. The other key is to have lined up a low-overhead distribution channel that can get this package to the target market effectively. Stop investing in the market, cease funding R&D to match the competition, and milk it for money to invest elsewhere.
The groups are distinguished from each other by their characteristic response to a discontinuous innovation based on a new technology. Each group represents a unique psychographic profile-a combination of psychology and demographics that makes its marketing responses different from those of the other groups.
SUMMARY: First there is a market… Made up of innovators and early adopters, it is an early market, flush with enthusiasm and vision and, often as not, funded by a potful of dollars earmarked for accomplishing some grand strategic goal. Then there is no market… This is the chasm period, during which the early market is still trying to digest its ambitious projects, and the mainstream market waits to see if anything good will come of them. Then there is. If all goes well, and the product and your company pass through the chasm period intact, then a mainstream market does emerge, made up of the early and the late majority. With them comes the real opportunity for wealth and growth.
• First problem: The company simply has no expertise in bringing a product to market. • A second problem: The company sells to the visionary before it has the product. • Problem number three: Marketing falls prey to the crack between the technology enthusiast and the visionary by failing to discover, or at least failing to articulate, the compelling application that provides the order-of-magnitude leap in benefits.
SOLUTION-This is a long-term agenda, requiring careful pacing, recurrent investment, and a mature management team. One of its biggest payoffs, on the other hand, is that it not only delivers the pragmatist element of the Technology Adoption Life Cycle but tees up the conservative element as well.
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This is a term used to describe the complexity that is
involved in the evolution of product from the early market
into the mainstream market.
Many business plans are based on a traditional
Technology Adoption Life Cycle.
Hence, the use of “TECHNOLOGY ADOPTION LIFE
CYCLE” on the next slide will help us to understand the
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Area under the curve
number of customers
Technology Adoption Lifecycle
Technology Adoption Life Cycle
The groups above are discussed in the next slide
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Technocrats, fundamentally committed to new technology
Have a Technological mindset .
Hope technology improve their lives.
Crusaders of the product who recommend it to others.
visionaries Revolutionaries who use technology for competitive advantages.
Willing to experiment with the new technology
Rely on recommendation from Innovators for purchase of product
Believe that the product will serve future needs
pragmatists Entry signify beginning of growth
Comfortable with new technology and products
Make the bulk of all technology infrastructure purchases. Adopt
technology only after weighing its benefits
Conservatives Enters when market approaches saturation
Pessimistic about investing in technology
Price-sensitive, highly skeptical, and very demanding
Skeptics Not potential customers
Conservatives who are technophobic
They don’t adopt unless they are forced by circumstances
Market target is not directed at them
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Technology adoption models are expressed in terms of a
standard bell curve, it means statistically, a random
sample of any given market or population must contain:
13.5% early adopters,
34.0% early majority,
34.0% late majority, and
So even if an industry is conservative by nature, there
will always be a sequence of adoption by different types
Composition of Technology Adoption Model
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• Technology is a central interest in their life.
• Are more likely to communicate “horizontally” across
• Intrigued with any fundamental advance.
• Often make a technology purchase simply for pleasure.
• Not very many innovators in any given market segment.
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• Buy into new product concepts very early in their life
• Easy to imagine, understand, and appreciate the benefits
of a new technology to their other concerns.
• Rely on their own intuition and vision, they are key to
opening up any high-tech market segment.
• Highly motivated, and driven by a “dream.”
• Are not technology minded, but business minded.
• likely to communicate “horizontally” across industry
• Not looking for an improvement; they are looking for a
• See the future in terms of windows of opportunity, and
they see those windows closing.Aegis School of Business and Telecommunucations 7
• Pragmatists have ability to relate to technology, but
ultimately driven by a strong sense of practicality.
• Believe that many of these new inventions end up as
• Aim to make a percentage improvement—incremental,
measurable, predictable progress.
• Tend to be “vertically” oriented.
• Pragmatists won’t buy from you until you are established,
yet you can’t get established until they buy from you.
• they like to see competition—wait to see costs get down.
• Evaluate and buy whole products.
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• Conservatives, often fear high tech a little bit, are
against discontinuous innovations.
• Not so comfortable with their ability to handle a
• The products they understand best are those
dedicated to a single function
• They wait until something has become an
• They want to buy from large well-established
• They tend to invest only at the end of a technology
life cycle, when products are extremely mature.
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• These group simply don’t want anything to do with new
• They do not participate in the high-tech marketplace,
except to block purchases.
• Laggards are generally regarded as not worth pursuing
on any other basis.
• The only time they ever buy a technological product is
when it is buried so deep inside another product—
Example, say, that a microprocessor is designed into
the braking system of a new car.
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The point of greatest peril in the development of a high-
tech market lies in making the transition from an early
market dominated by a few visionary customers to a
mainstream market dominated by a large block of
customers who are predominantly pragmatists in
A successful crossing is how high-tech fortunes are
made; failure in the attempt is how they are lost.
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The early market
The mainstream market
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Perceived cause of chasm
• Support revolution
• Break away from pack
• Follow own dictates
• Take risks
• Motivated by future opportunities
• Seek what is possible
• Support evolution
• Stay with the herd
• Consult with their colleagues
• Manage risks
• Motivated by present problems
• Pursue what is probable
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For all these reasons—
• Whole product leverage
• Perceived market leadership
it is critical that, when crossing the chasm, you focus
exclusively on achieving a dominant position in one or
two narrowly bounded market segments. Based on this
strategy, we recommend the Competitive Positioning
Compass Model, which we will see on the next slide.
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The Competitive-Positioning Compass
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To cross the chasm, a company focus on a single market,
a beachhead, win domination over a small specific market
and use it as a springboard to adjacent extended markets
Crossing the chasm requires the following steps:
•Target the point of attack.
•Assemble an invasion force.
•Define the battle
-create the competition
-develop the elevator pitch
-build this into all your company communications.
•Launch the invasion.
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