In his 1962 book, Diffusion of Innovations, author and professor Everett Rogers looks at the product adoption lifecycle. He wrote that there were 5 categories of adopters for any new, innovative product and they each had their own motivations. These adopters would act at different rates and at different points in the product lifecycle.
The five categories of adopters are:
- Innovators. Innovators are the first set of users for a new product. They are willing to take risks and often adopt leading-edge products in order to learn about the new innovations they bring. They tend to be more tolerant of functionality or design that is not fully formed. While Innovators don’t yield great influence over market adoption, they can be a useful segment for a company by providing feedback and new product uses.
- Early Adopters. Early Adopters are the next set of users on the product adoption curve. Although they seek a product that is a little more mature, they are still willing to learn about a new product and discuss their experiences with it. If they determine that the product is a good one, they will often evangelize on its behalf. For this reason, they usually have significant influence on whether a product succeeds in the broader market. Companies that actively market to Early Adopters and satisfactorily meet their needs can greatly increase the chances of their product succeeding in the broader market.
- Early Majority. Early majority adopters are more risk adverse and wish to know that others have had a good experience with a product before they will adopt it themselves. The experiences of Early Adopters can greatly influence the purchases of the Early Majority. They Early Majority tend to adopt products before the average user does and they represent the first portion of the broader market.
- Late Majority. Late majority adopters tend to embrace a new product after the average user and they are notably more skeptical of new innovations than the earlier three categories of adopters. However, they represent a sizable piece of the broader market and a company would generally be wise to market their product to this category in order to expand its adoption.
- Laggards. Laggards hold onto older products as long as they can reasonably do so and only adopt a new product when their existing one ceases to be viable. They are generally not the type of adopter that a marketer would focus on.
Management consultant and author Geoffrey Moore looked at those times when the Early Adopters were unable to sufficiently influence the Early Majority in his 1991 book, Crossing the Chasm. He called this gap between the Early Adopters’ acceptance of a product and the skepticism of the Early Majority the ’chasm.’ Marketers would need to proactively address the concerns of the Early Majority in order to ‘cross the chasm’ to achieve mainstream success.
Blackberry (the company previously known as Research in Motion) is an example of a former market leader that has declined dramatically due to its inability to ‘cross the chasm’ with its recent product launches. As an early innovator in the smartphone space, they were successful for years by concentrating on the corporate market and producing handsets featuring their characteristic physical keyboard which were focused on primarily on email access.
However, Apple introduced the iPhone in 2007 which did away with the concept of a physical keyboard and introduced a 'slab' handset that used the entire face as a touchscreen display. The iPhone’s user interface leveraged touchscreen gestures and was ideal for consuming media. The iPhone was a hit with consumers and in its opening weekend of sales, the stores of then-exclusive carrier AT&T were “virtually sold out.” Seemingly overnight, the iPhone and similar Android handsets displaced those of Blackberry in the marketplace.
Six years after the introduction of the iPhone, Blackberry came to market with its first modern touchscreen-only handset called the Z10. The Z10 featured a brand-new, yet immature Blackberry 10 OS that did not have the selection of apps or mature ecosystems of either Apple’s iOS or Google’s Android. The Blackberry 10 OS was also not as user friendly or had as polished of a user experience of either iOS or Android.
Despite these initial shortcomings, Blackberry chose to position the Z10 as a premium product and priced it the same as competing Apple and flagship Android handsets. The Z10 was a marketplace failure and sold a small fraction of the number of handsets that competing Apple and Android did. Innovators and some Early Adopters who had previously embraced the Blackberry ecosystem did purchase the Z10. However, the Z10 was unable to ‘cross the chasm’ and gain traction with Early Majority users. With the already broad adoption of the iPhone and Android platforms, the Early Majority category of adopters remained skeptical of the Z10 and its new OS.
In its first full quarter of release, Blackberry only sold 2.5 million Blackberry 10 handsets, which included both the Z10 and the sister model Q10 which featured a physical keyboard like previous Blackberry phones. Shortly thereafter, Blackberry cut the price of the Z10 and later that year CEO Thorsten Heins was replaced by John Chen, who had formerly led the turnaround of Sybase.
Had Blackberry been able to ‘cross the chasm’ with the Z10, their handset business may have been able to regain some of its former success. However, by 2014 Blackberry devices had a mere 0.3% market share in smartphone handsets. New CEO Chen ultimately decided to refocus the company by de-emphasizing handset sales and to instead focus on corporate software and mobile services. In a few years we’ll know if Chen was successful in transforming the company, but it seems certain that Blackberry handsets will be largely a relic of the earlier days of the Internet.