How to create segmented customer experiences for successful innovation diffusion

1. Customer CentricCustomer Centric
Innovation MarketingInnovation Marketing
oror
How to create segmentedHow to create segmentedHow to create segmentedHow to create segmented
customer experiences forcustomer experiences forcustomer experiences forcustomer experiences for
successful innovation diffusionsuccessful innovation diffusion
INNOVATION
MARKETING
Dr. Ute Hillmer
8th July, 2011

2. Content of the Lecture
1. Why is Innovation Marketing different?
2. Success factors of an innovation diffusion strategy
3 Key Elements of successful technology diffusion3. Key Elements of successful technology diffusion
4. Customer profiles
5. Best Practice Innovation Marketing
INNOVATION
MARKETING

3. Why isWhy is
InnovationInnovation
MarketingMarketing
diff t??different??
“… most new TECHNOLOGIES
change the way you do things”
INNOVATION
MARKETING

4. Technology Marketing is differentgy g
...
thus we have
to changeto change
how we do
thingsthings...
INNOVATION
MARKETING

5. Directly involved Innovation
Resources: R&D andResources: R&D and
Marketing (inbound+outbound)Marketing (inbound outbound)
Cash flow over time
Market Demand:Market Demand:
Product Lifecycle
R&D
inbound Marketing
INNOVATION
MARKETING
outbound Marketing

6. An Idealized Innovation LifecycleAn Idealized Innovation Lifecycle
Continuous InnovationDisruptive Innovation
earketsizeMa
Time
Laggards
16%
Late
Majority
Early
Adopters
Early
Majority
Innovators
2,5%
INNOVATION
MARKETINGRogers Diffusion of Innovation 1995
16%
34%13,5% 34%

7. Diffusion of an Innovation:
Variations
rketsize
Ti
Ma
Time
e
rketsize
Marketsiz
Ma
Time
M
INNOVATION
MARKETING
TimeRogers Diffusion of Innovation
Moore; Crossing the Chasm

8. Success Factors of an
Innovation Diffusion Strategy
1. Favourable characteristics of innovation.
2. Business Strategy that is based on customer
insight and recognises different customer
profiles within a market category.
3. Communication Strategy wheregy
communication content and communication
vehicle considers point 1+2.p
INNOVATION
MARKETINGE.Rogers, Diffusion of Innovation, 1995

9. Key Elements of successfuly
Innovation Marketing
Characteristics of innovation
CustomerCustomer insightinsight
Communication strategy
INNOVATION
MARKETINGE.Rogers, Diffusion of Innovation, 1995

10. “I ti ”“Innovativeness”
degree to which an individual or a unit is relatively= degree to which an individual or a unit is relatively
earlier in adopting new technologies than other
members of a system
INNOVATION
MARKETING
Rogers Diffusion of Innovation 1995

11. An Idealized Innovation
Lifecycle
earketsizeMa
Time
Laggards
16%
Late
Majority
Early
Adopters
Early
Majority
Innovators
2,5%
INNOVATION
MARKETING
16%
34%13,5% 34%
Moore; Crossing the Chasm

12. Individual Adopter Categorization
th B i f I tion the Basis of Innovativeness
Marketsize
Conservatives:
Pragmatists:
Stick with the herd!
M
Skeptics:
No way!
Hold on!
Visionaries:
Get ahead!Techies: No way!Get ahead!Techies:
Try it!
Time
LaggardsLate
Majority
Early
Adopters
Early
Majority
Innovators
INNOVATION
MARKETINGMoore; Crossing the Chasm

13. RecapRecap
• Innovations diffuse at different speed
• Within ONE customer category there areWithin ONE customer category there are
typical customer profiles. Paying attention to
them and communicating with the customer
profiles in mind will help diffuse anprofiles in mind will help diffuse an
innovation.
INNOVATION
MARKETING

14. Innovators: Techies
Technology is their life
Technology - Crazy
– Spend hours to get the product to workp g p
– Do everything to help the product
– Technology should be for free
Forgiving souls
Don’t mind lousy documentation and weird procedures– Don t mind lousy documentation and weird procedures
to achieve functionality
– Want technology first – no need for a sales channelWant technology first no need for a sales channel
Their role: they move technology forward but do
INNOVATION
MARKETING
not generate much diffusion + generate no
income Moore; Crossing the Chasm

15. Visionaries
Technology enthusiastic businessmen,
driven by a dreamdriven by a dream
Businessman first
- driven to be the first
- new technologies are used to serve their own strategic benefitg g
- want fundamental improvements
- make business world aware of new technologiesmake business world aware of new technologies
- not very price-sensitive, have project budget
- live in the futurelive in the future
INNOVATION
MARKETINGMoore; Crossing the Chasm

16. Visionaries (2)Visionaries (2)
Take a risk
- love publicitylove publicity
- risky projects
- start projects from ground up, don‘t want
standards, want to develop them, p
- buy by intuition (but may claim otherwise)
- highly motivated, driven by a dream
INNOVATION
MARKETINGMoore; Crossing the Chasm

17. Visionaries (3)Visionaries (3)
E ll t i tExcellent communicators
- charismatic; they fight for their project
- like to serve as a reference / opinion leader
- network with techies and clever peoplenetwork with techies and clever people
- too many references de-motivate visionaries
l l ki f id d i i ti- always looking for new ideas and inspiration
Their role: they fund the product development,
give the innovation a “real” application and
INNOVATION
MARKETING
g pp
serve as an opinion leader.
Moore; Crossing the Chasm

18. Pragmatistsg
Look for measurable, incremental improvement
Driven by business resultsDriven by business results
- improved productivity
Avoid risk
- risk is a negative termrisk is a negative term
- want to work with market leader/ established firms
- look for product quality, support, consulting, goodlook for product quality, support, consulting, good
interfaces, reliability
- want standards, “save buys”
- need references
- live in the present
INNOVATION
MARKETINGMoore; Crossing the Chasm

19. Pragmatists (2)Pragmatists (2)
Loyal customers
• are interested in company they buy from
• revenue / profit should grow steadily “stability”• revenue / profit should grow steadily stability
• network within company and industry
• the first mass market
Their role: They hold the key to the massy y
market
BUT: you need to be established in order forBUT: you need to be established in order for
them to buy from you but you don‘t get
established until they buy from you ! ?
INNOVATION
MARKETING
estab s ed u t t ey buy o you
Moore; Crossing the Chasm

20. Pragmatists (3)Pragmatists (3)
Consequences out of this profile
One really needs to be familiar with the
processes and issues that worry the
pragmatists
 Offer a clear relative advantage to them
INNOVATION
MARKETINGMoore; Crossing the Chasm

21. ConservativesConservatives
“I don’t have to like the product, even if I use it”
- They do what pragmatics do but later- They do what pragmatics do, but later
- Invest in technology to keep up with competition
- Have low technical competence
INNOVATION
MARKETINGMoore; Crossing the Chasm

22. Conservatives (2)Conservatives (2)
- predictable
- want everything faster, cheaper, improvedy g , p , p
- are price sensitive
- like bundles, pre-installed solutions
- “if it isn’t broken, don’t fix it”if it isn t broken, don t fix it
- very interested in 24/7 service and support
Their role: huge mass market
INNOVATION
MARKETING
e o e uge ass a et
Moore; Crossing the Chasm

23. Individual Adopter Categorization
th B i f I tion the Basis of Innovativeness
Marketsize
Conservatives:
Pragmatists:
Stick with the herd!
M
Skeptics:
No way!
Hold on!
Visionaries:
Get ahead!Techies: No way!Get ahead!Techies:
Try it!
Time
LaggardsLate
Majority
Early
Adopters
Early
Majority
Innovators
INNOVATION
MARKETING

24. Mainstream BehaviourMainstream Behaviour
lative
doptions
Noncumul
mberofad
N
num
Increasingly
conforming behaviour
GROUP identities
TimeLaggardsLate
Majority
Early
Adopters
Early
Majority
Innovators
INNOVATION
MARKETINGHillmer, Technology Acceptance in Mechatronics, 2009.

25. Individualistic BehaviourIndividualistic Behaviour
lative
doptions
Noncumul
mberofad
N
num
Increasingly
individualistic
behaviour
ROLE identities
TimeLaggardsLate
Majority
Early
Adopters
Early
Majority
Innovators
INNOVATION
MARKETINGHillmer, Technology Acceptance in Mechatronics, 2009.

26. Marketing Content Generation, based ong ,
Adopter Categorization
Size
Technical
MarketS
Knowledge
Challenge
Stability
Tech.
Competitive
Challenge
y
Security
Managerial
Challenge
Managerial Competence
W k Lif B l
Managerial Challenge
T h i l C t
Tech.
Competitive
Challenge
Work-Life Balance
Technical Competence
Adoption Time
INNOVATION
MARKETING
Adoption Time
Hillmer, Technology Acceptance in Mechatronics, 2009.

27. Trustbuilding with Pragmatic
Innovation Customers
Concentrate a overwhelming power on a„Concentrate a overwhelming power on a
small, focused target market segment“
 FOCUS
Customer
INNOVATION
MARKETING

28. Best Practice Innov MarketingBest Practice Innov. Marketing
INNOVATION
MARKETING

29. Best Practice Innov MarketingBest Practice Innov. Marketing
INNOVATION
MARKETING

30. Best Practice Innov MarketingBest Practice Innov. Marketing
INNOVATION
MARKETING

31. Pictures Curtesy ofPictures Curtesy of
Vi i b t l h /A ti l /U l dFil /2Visionary www.beautyangleshop.com/Article/UploadFiles/2
Pragmatist
http://us.cdn4.123rf.com/168nwm/nyul/nyul0901/nyul090100351/4130478-
t it f h f l b i h ldi ili j dportrait-of-happy-successful-businessman-holding-newspaper-smiling.jpg oder
http://us.cdn2.123rf.com/168nwm/patrick1958/patrick19580805/patrick195808
0500253/3081392-handsome-young-successful-businessman-sitting-on-bar-
stool white background studio shot jpgstool-white-background--studio-shot.jpg
Conservative:
http://us.cdn4.123rf.com/168nwm/logos/logos1003/logos100301371/7808434-
i d b i jworried-businessman.jpg
Laggard http://www.123rf.com/photo_8228428_portrait-of-busy-chief-calling-by-
phone-and-refusing-from-cup-of-coffee-held-by-his-secretary.html
Herde www.baeren-blatt.de/juniorline/dpa-JuniorLine-
images/Pferdeherde_20742838.onlineBild.jpg
INNOVATION
MARKETING

32. The End!The End!
Thank youy
INNOVATION
MARKETING