Will New Products lead us to Nirvana? David Faulkner, CPAC, 9 Nov 2006 Complete, Modular, Ready Today Will New Products lead us to Nirvana? David Faulkner, CPAC, 9 Nov 2006

35,000 ft View Existing models for predicting market adoption rates Challenges this initiative faces As seen from a new arrivals perspective What happens next

Bass Diffusion Model f(t) is the rate of change of the installed base fraction F(t) is the installed base fraction m is the ultimate market potential p is the coefficient of innovation q is the coefficient of imitation Dr. Frank Bass 1969

Graph of Bass equation

So where are we?

One Catch-The Curve is not Continuous

Innovators Technology enthusiasts Embracers of new technology Expect that there will be issues But willing to work through them Do not buy on value added Must be cheap, since rarely budgeted

Early Adopters Visionaries Motivated by a dream Will take a risk on new technology Desire a breakthrough in productivity Not to be confused with improvement Revolutionize their business Keep in contact with the Innovators

Early Majority Pragmatic Vertical communicators References must come from within ‘their world’ Want to see competition Want established players Catch-22 Want predictable, measurable progress

Late Majority Reluctant followers Must work without issue Follow the lead of the Early Majority Integrators are classic example of this

Differences across the Chasm Early Adopter Using this as a change agent Wants to get a jump on the competition Early Majority Want a productivity improvement Minimize discontinuity with the status quo Early Adopters not good references for Early Majority

“Distrust” Visionaries want to change the world but… If it doesn’t work, the Pragmatist is left to clean up the mess Why take the risk

Where are we today? What is your opinion? In order to succeed this initiative must attract the attention of the early majority Will new products do that ? Or are we restarting the adoption cycle again?

How to succeed No one company will be able to completely control the market Market will not accept this, or success will be limited Co-opetition is required

Identify one or two Focus Markets Focused attention on a segment of the market Refining appears to be leading the charge Others? Trying to satisfy too many markets at once leads to dilution of effort

References Critical to the success of this initiative Must be valid for the market segment Must have credibility with the Early Market Adopters