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2.3 Market Failure, Risk and user Adoption - Coggle Diagram
2.3
Market Failure, Risk and user Adoption
How Customers Adopt Innovation
Diffusion of innovation theory
Graphical representation illustrating the rate of adoption by different adopters (Everett Rogers, 1962)
Innovators
Creative risk takers
Highly cosmopolitan
Early Adopters
Opinion Leaders
Early Majority
Reject innovations
Late Majority
Skepticism
Larragrds
Least cosmopolitan
Key attributes to enhance adoption of innovation
Relative advantage
New innovation must be better than its predecessor
Complexity
Is it user friendly
Compatibility
Example is chopsticks
Trial ability
Could it be tried before adoption decision
Observability
Could it be observed before adoption decision
Reinvention
Could it be changed and improved
Why Failure in Innovation Occur
Innovations has as much risks as rewards
Technology push, sales pull (Read more)
Examples
One Person EV (Sinclair C5)
Concord
Kodak
Failure is a proof of trying
Fail frequently, and fail early to iterate ideas
Risks in Innovation
Risk is the probability that something will happen
Innovation is usually associated with the risk of failure
Good practice methods reduces risk of failure
Good innovation management
Product advantage
What makes it different?
Delivering unique benefits is a vital success factor
Market Knowledge and voice of the customer
Market assessment and customer insights
Financial analysis
Acknowledgement of risk (Risk Assessment)
Top management support and Innovation champion or Leader
Create cross-functional teams
Product definition
Defined target market
Defined product benefits
Proficiency
In execution and marketing