Diffusion of Innovations

Opinion Leadership

The process by which one person (the opinion leader)

informally influences the consumption

actions or attitudes of others who may be opinion seekers or opinion recipients.

Diffusion Diffusion ProcessProcess

The process by which the acceptance of an

innovation is spread by communication to members of social

system over a period of time.

Adoption Adoption ProcessProcess

The stages through which an individual consumer passes in

arriving at a decision to try (or not to try), to continue using (or

discontinue using) a new product.

Elements of the Diffusion Process

The Innovation The Channels of Communication The Social System Time

Defining Innovations Firm-oriented definitions Product-oriented definitions Market-oriented definitions Consumer-oriented definitions

Product-Oriented Definitions

Continuous Innovation

Dynamically Continuous Innovation

Discontinuous Innovation

Telephone Innovations

Telephone

Cell Phone

Fax Machine

Telephone answering machinesCall forwardingCall waitingCaller IDBanking by telephoneCall-prompting systems

Hold buttonLine-in-use indicatorRedial buttonAuto dialing featureTouch-tone service800 Numbers900 Numbers

Ability to send/receive emailIncorporate PDA functionsCalendar/PhonebookVoice-activated dialing

Switch from analog to digital

Include cameraRinger stylesPlay games

Fax modemMobile fax machinesHome office systems

(combined fax, copier, computer printer)

Plain paper faxSpeed dial buttonsDelayed sendCopy functionPaper cutter

Discontinuous Innovations

Dynamically ContinuousInnovations

ContinuousInnovations

Product Characteristics That Influence Diffusion

Relative Advantage Compatibility Complexity Trialability Observability

Characteristics That Influence Diffusion

CHARACTERISTICSCHARACTERISTICS EXAMPLESEXAMPLES

Relative Advantage

Air travel over train travel, cordless phones over corded telephones

CompatibilityGillette MACH3 over disposable razors, digital telephone answering machines over machines using tape

ComplexityElectric shavers, instant puddings

continuedCHARACTERISTICSCHARACTERISTICS EXAMPLESEXAMPLES

TrialabilityTrial size jars and bottles of new products, free trials of software, free samples, cents-off coupons

Observability

Clothing, such as a new Tommy Hilfiger jacket, a car, wristwatches, eyeglasses

Time and Diffusion Purchase Time Adopter Categories Rate of Adoption

Adopter Adopter CategoriesCategories

A sequence of categories that

describes how early (or late) a consumer

adopts a new product in relation to other

adopters.

Adopter Categories

Innovators2.5%

EarlyAdopters

13.5%

Laggards

16%

Percentage of Adopters by Category Sequence

EarlyMajority

34%

LateMajority

34%

Innovators: Description

• 2.5% of population• Venturesome• Very eager to try new ideas• Acceptable if risk is daring• More cosmopolite social relationships• Communicates with other innovators

Early Adopters: Description

• 13.5% of population• Respected• More integrated into the local social system• The persons to check with before adopting a

new idea• Category contains greatest number of

opinion leaders• Are role models

Early Majority: Description

• 34% of population• Deliberate• Adopt new ideas just prior to the average

time• Seldom hold leadership positions• Deliberate for some time before adopting

Late Majority: Description• 34% of population• Skeptical• Adopt new ideas just after the average

time• Adopting may be both an economic

necessity and a reaction to peer pressures• Innovations approached cautiously

Laggards: Description

• 16% of population• Traditional• The last people to adopt an innovation• Most “localite” in outlook• Oriented to the past• Suspicious of the new

Stages in Adoption Process

NAME OF STAGE

WHAT HAPPENS DURING THIS

STAGEEXAMPLE

AwarenessConsumer is first exposed to the product innovation.

Janet sees an ad for a new MP3 player in the magazine she is reading.

Interest

Consumer is interested in the product and searches for additional information.

Janet reads about the MP3 player on the manufacturer’s Web site and then goes to an electronics store near her apartment and has a salesperson show her a unit.

Evaluation

Consumer decides whether or not to believe that this product or service will satisfy the need--a kind of “mental trial.”

After talking to a knowledgeable friend, Janet decides that this MP3 player will allow her to easily download the MP3 files that she has on her computer. She also feels that the unit’s size is small enough to easily fit into her beltpack.

Stages in Adoption Process

Trial

Consumer uses the product on a limited basis

Since an MP3 player cannot be “tried” like a small tube of toothpaste, Janet buys the MP3 player online from Amazon.com, which offers a 30-day full refund policy.

Adoption (Rejection)

If trial is favorable, consumer decides to use the product on a full, rather than a limited basis--if unfavorable, the consumer decides to reject it.

Janet finds that the MP3 player is easy to use and that the sound quality is excellent. She keeps the MP3 player.

NAME OF STAGE

WHAT HAPPENS DURING THIS

STAGEEXAMPLE

An Enhanced Adoption Process Model

Pre-existing problem or

NeedAwareness Interest Evaluation Trial

Adoption or

Rejection

Postadoption or Postpurchase

Evaluation

Evaluation

Adoption or Rejection

Discontinuation

Discontinuation or RejectionRejection

The Relative Importance of Different Types of Information Sources in the Adoption Process

Importance

High

Low

Aw

aren

ess

Ado

ptio

n

Tri

al

Eva

luat

ion

Inte

rest

Personal and interpersonal sources

Impersonal mass-media sources

Issues in Profiling Consumer Innovators

Defining the Consumer Innovator Interest in the Product Category The Innovator Is an Opinion Leader Personality Traits Media Habits Social Characteristics Demographic Characteristics Are There Generalized Consumer

Innovators?