2 diffusion

8/3/2019 2 Diffusion

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Diffusion of Innovation


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The Diffusion Concept

The process by which and innovation is

communicated through certain channels over

time among the members of a social system

Elements of Diffusion

Innovation

Channels of Communication

Time

Social System


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Innovation

An idea, practice or object perceived as new by

an individual or other unit of adoption

Types of Innovation Discontinuous Innovation

Dynamic Innovation

Continuous Innovation


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Types of Innovation

Discontinuous

Innovation

e.g.

Telephone

Dynamically

Continuous

Innovations

e.g. Cell

Phone

Continuous

Innovation

e.g. Cell

Phone with

Camera

FrequentInfrequentRare

High

Moderate

Low

DegreeofBehavioralChan

geRequired

Frequency of Occurrence


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Factors Affecting Innovation Adoption

Relative Advantage

Compatibility

Complexity Trialability

Observability

Other factors are Type of social system, Typeof decision, Marketing effort, Need

fulfillment/problem solving, and perceived risk


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Consumer Resistance to Innovation

The resistance offered by the consumers to an

innovation, either because it poses potential

changes from a satisfactory status quo or

because it conflicts with their belief structure


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Diffusion Process,Adopter Categories

1) INNOVATORS - are first to buy andtypically described as venturesome,

younger, well educated, financiallystable, and willing to take risks.

2) EARLY ADOPTERS - are local opinion

leaders who read magazines and whoare integrate into the social systemmore than the average consumer.


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3) EARLY MAJORITY - solid, middle-classconsumers who are more deliberate and

cautious

4) LATE MAJORITY - described as older,more conservative, traditional, andskeptical of new products


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Laggards

Resist change

Conservative

Like tradition

Often older & lower insocioeconomic status

Nonadopters

Refuse to change No way!

If I haveto buy, Iwill

OK, we willbuy X


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Consumer Resistance to Innovation

Innovation

Exposure

Flexible to

Modification

Modification

Adoption

Rejection

ResistanceNo

No

Yes


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Two types of communication in diffusion are:

1. Communications in the heterophilous

groups (groups outside an individualspersonal network)

2. Communications in the homophilousgroups. (i.e., peer and family)

Communication is a Keyelement in the DiffusionProcess


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Time

Time has a bearing on

The adoption process

Innovativeness of the consumers

The innovations rate of adoption

Adoption Process5 stages

Awareness

Interest

Evaluation

Trial

Adoption/Rejection


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Channels of Communication

Marketers to Consumers

Among Consumers

Product dedicated websites

Company websites Product related magazine and journals

Consumer shows, exhibitions and fairs

TV shows dedicated to innovations

Beauty pageants

National level awards and game shows


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Rogers also proposed a five stagemodel for the diffusion

Knowledge - learning about the existenceand function of the innovation

Persuasion - becoming convinced of thevalue of the innovation

Decision - committing to the adoption ofthe innovation

Implementation - putting it to use Confirmation - the ultimate acceptance (or

rejection) of the innovation


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An Enhanced Model of Adoption ProcessConsumer Innovativeness Pre-existing Need Venturesomeness andinterest in Product Category

Awareness

Interest

TrialEvaluation

Rejectionorpostponement

Adoption Rejection

Continued

Rejection

Later

Adoption

Post Adoption

EvaluationContinued

Rejection

Later

Adoption

Continued

AdoptionDiscontinuance


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Why Some New Products Fail andOthers Succeed

Unreal time pressure & vested interest groups Absorption in process: lack of objectivity, courage (risk)

Product Deficiencies (Technical or Design Problems)

Inadequate research (Overestimation of Market Size)

Poor Execution of Plans (Promotion, Distribution, Price, poor

timing, etcetera) Result: No differential advantage & Failure to Meet Customer

Needs

80 to 90% Fail. Why?

Absolute failure Relative failure


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#1. Performance & Price

New product failures generally offer the same

or worse performance than competingproducts with the same or higher price

#2. Inadequate Market Analysis

Offer a unique benefit (a differential advantage)

Solve a consumers problem or providean

opportunity, a reward

New Product Success

Why Some New Products Fail andOthers Succeed

80 to 90% Fail. Why?


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Thankyou

2 diffusion

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