Crossing the Chasm - What's New, What's Not


Published on

Managing Director, Geoffrey Moore Consulting
Venture Partner, Mohr Davidow Ventures
Chairman Emeritus, TCG Advisors, The Chasm Institute and The Chasm Group
Member of the Board of Directors, Akamai Technologies and several pre-IPO Companies

Geoffrey Moore is an author, speaker, and advisor who splits his consulting time between start-up companies in the Mohr Davidow portfolio and established high-tech enterprises, most recently including Salesforce, Microsoft, Intel, Box, Aruba, Cognizant, and Rackspace.

Moore’s life’s work has focused on the market dynamics surrounding disruptive innovations. His first book, Crossing the Chasm, focuses on the challenges start-up companies transitioning from early adopting to mainstream customers. It has sold more than a million copies, and its third edition has been revised such that the majority of its examples and case studies reference companies come to prominence from the past decade. Moore’s most recent work, Escape Velocity, addresses the challenge large enterprises face when they seek to add a new line of business to their established portfolio. It has been the basis of much of his recent consulting.

Irish by heritage, Moore has yet to meet a microphone he didn’t like and gives between 50 and 80 speeches a year. One theme that has received a lot of attention recently is the transition in enterprise IT investment focus from Systems of Record to Systems of Engagement. This is driving the deployment of a new cloud infrastructure to complement the legacy client-server stack, creating massive markets for a next generation of tech industry leaders.

Moore has a bachelors in American literature from Stanford University and a PhD in English literature from the University of Washington. After teaching English for four years at Olivet College, he came back to the Bay Area with his wife and family and began a career in high tech as a training specialist. Over time he transitioned first into sales and then into marketing, finally finding his niche in marketing consulting, working first at Regis McKenna Inc, then with the three firms he helped found: The Chasm Group, Chasm Institute, and TCG Advisors. Today he is chairman emeritus of all three.

To find out more about Geoffrey Moore please visit:

More information about Geoffrey Moore:

Geoffrey Moore on LinkedIn:

Geoffrey Moore on Twitter:

Geoffrey Moore on Google Plus:

Published in: Business

Crossing the Chasm - What's New, What's Not

  1. 1. Crossing the Chasm What’s New? What’s Not? MDV Executive Forum February 11, 2014
  2. 2. Disruptive Innovation What Makes High-Tech Marketing Different? • High Risk • Unproven products and promises • Incompatible and incomplete infrastructure • Social resistance to change • Low Data • No product history • No company track record • No best practices 2
  3. 3. The Technology Adoption Life Cycle The Challenge Facing Every Disruptive Innovation 3
  4. 4. Innovators - Technology Enthusiasts 4
  5. 5. Early Adopters - The Visionaries 5
  6. 6. Early Majority - Pragmatists 6
  7. 7. Late Majority - Conservatives 7
  8. 8. Laggards - Skeptics 8
  9. 9. How High-Tech Markets Develop The Technology Adoption Life Cycle MAIN STREET TORNADO EARLY MARKET CHASM 9 BOWLING ALLEY
  10. 10. Life-Cycle Metrics that Matter Tracking Performance Relative to the Chasm • Early Market • • One or more flagship customers making big-bet commitments In the Chasm • • • Cannot support yet another big-bet commitment Pragmatists still holding back from entering the market Taking the Beachhead • • • Nailed a high-pain segment-specific use case Getting strong word-of-mouth support within target segment In the Bowling Alley • • Inside the Tornado • • Additional use cases coming on board, viral in adjacent segments Horizontal “killer app” -- hyper-growth in the category On Main Street • • 10 Hyper-growth subsides – pecking order established Customers seek sustaining innovation going forward
  11. 11. Crossing the Chasm Two Key Principles • Target a “beachhead” segment • • Niche market with an intractable problem, not solvable by conventional means • Process owner is under pressure to find a solution • • Highly focused approach to “rekindling the flame” Pragmatists are willing to consider disruptive approach Commit to provide the “whole product” • • Complete solution to the intractable problem • Typically involves products and services from partners and allies • 11 Bring all the ingredients with you Lead vendor takes responsibility for ensuring customer success
  12. 12. Crossing the Chasm What’s New? End User IT! • Digital Services • Light to deploy, focus on user experience • The Lean Start-Up • Minimum viable product, rapid agile learning • In consumer use cases, leap to the tornado • Critical Success Factors: The Four Gears • Acquire • Engage • Convert • Enlist 12
  13. 13. Tipping Point for B2C Markets The Four Gears Model Power Gear + = Virality o = Retention - = Churn Performance Gear ACQUISITION ENLISTMENT Starter Motor CONVERSION Performance Gear 13 ENGAGEMENT Power Gear
  14. 14. Four-Gears Metrics that Matter Tracking Performance Relative to the Tornado • Acquire • Rate of gaining new users • Engage • Average length, depth, and frequency of user engagement • Convert • Percentage of total users that participate in business model • Enlist + Virality (New customers coming from existing customers – high NPS) - Churn (Existing customer defecting – “de-enlisting” –low NPS) 14
  15. 15. Slowest Gear Theory • Thesis • Prior to the tornado • At any given point in time • One of the four gears is slowing the other three down • Actions Required • • • • • • 15 Identify the slowest gear Focus everyone on speeding it up Maintain attention on the other three gears Repeat every quarter until The tornado happens Or you run out of gas
  16. 16. Crossing the Chasm What’s Not New? Enterprise IT! • Taking the Enterprise Digital • Heavy to deploy, focus on end-to-end systems • Crossing the Chasm • Minimum viable whole product (add partners and allies) • Bowling alley strategy • Critical Success Factors • Pre-chasm ─ Breakthrough projects with top-tier customers • Post-chasm ─ 16 High value use cases with compelling reasons to buy
  17. 17. Target Market Initiative Framework A Checklist for Crossing the Chasm Planning Key sponsor 1. Target Customer 2. Compelling Reason to Buy Key motive Complete solution 3. Whole Product 4. Partners and Allies Manages sales & fulfillment complexity 5. Sales Channel 6. Pricing Legitimate alternatives 17 Maps to all the above 7. Competition 8. Positioning Next growth segment Fill in the gaps 9. Next Target Core differentiation
  18. 18. The New Examples • • • • • • • • • 18 Salesforce VMware Aruba Lithium Rocket Fuel Infusionsoft Mozilla Box Workday Target Market Target Market Whole Product Whole Product Partners & Allies Partners & Allies Partners & Allies Positioning Positioning
  19. 19. New Examples from the Room 19
  20. 20. Key Takeaways 20
  21. 21. Thank You 21