Thursday, October 1, 2009

Crossing the Chasm by Geoffrey A. Moore

I'm capturing some key thoughts from this book to keep in mind when I take on future projects. The chasm is the gap between Early Adopters and Early Majority (pragmatists). Early Adopters troll for innovations across industry (horizontal). They are easy to find and convince. However, these mavericks represent a very small segment of the population. Pragmatists, on the other hand, network amongst themselves (vertically), and are naturally suspicious of change. Change comes with the inherent risk of disruption and failure. Pragmatists therefore won't adopt innovation until it has been proven in their industry.

The innovator's challenge, therefore, is to invade a new market similar to the invasion on the beaches of Normandy on D-Day. Pour all resources on establishing a beach-head. Then move on from there.

How do you decide where to invest your resources? "First you divide up the universe of possible customers into market sgements. Then you evaluate each segment for its attractiveness. After your targets are narrowed develop estimates of such factors as the market niches' size, their accessibility to distribution, and the degree to which they are well defended by competitors. Then you pick one and go after it." (p. 89)

Sounds easy, right? The problem is making such a high risk decision in a low data arena.

"[Statistics] is like sausage - your appetite for it lessens considerably once you know how it is made...when you hear [the marketer] saying things like, 'It will be a billion-dollar market in 1995. If we only get 5 percent of that market...' When you hear that sort of stuff, exit gracefully, holding on to your wallet." (p. 91)

I look forward to reading more, to see if there are pitfalls to avoid, or new ways of reading the pragmatist's market. How do we help them relate to new ideas? How do we help them make the leap to adoption?

Picture borrowed from Blend Gateway.