top of page

Knowing the difference between risk immune innovations vs. disruptive innovations

In his book Inside the Tornado, Moore states: “Truly discontinuous innovations are products or services that require the end-user and marketplace to dramatically change their past behaviour, with the promise of gaining equally new dramatic benefits.” This statement demonstrates that the market for “risk immune innovations” is easier to enter than that of disruptive technologies.

In the “risk immune” areas of the “early adopter,” “earlier majority” and the “late majority,” users are aware they have a problem needing to be solved and simply need to understand the cost/benefit arguments for the new solution… disruptive or discontinuous offerings are hard to sell.

Let's take a start to identify the five buying groups:

  1. Early Adopters/Pioneers

  2. Mass Market/Followers

  3. Laggards

  4. Early Majority

  5. Late Majority

  6. Innovators

Have you heard the i2p Podcast? Take a journey with Ross Blaine & Dr. Paul as they discuss concepts from the i2p book!

Don't forget to join our mailing list to be the first to know about everything going on in the i2p community.

Innovators represent only 4 to 7% of the buyers in a marketplace.

What to expect from this group of consumers:

  • Low sales volumes because these are usually driven based on “word of mouth” referrals that cause initial product awareness.

  • Distribution will be selective, in order to create a stable product through user trials.

  • Negative profitability because product placement will override profits since additional resources for product improvements will be needed and useful feature and function demands must be rapidly acted upon.

  • Few if any competitors, most often from other small entrepreneurial ventures will cut the price to place their product with the innovators to gain feedback and prove the product's business case for users in the later market adoption groups.

The i2P team is a group of innovators. For example, I had the first commercially available portable or “luggable” computer. Why? Because I recognized that I could carry all my company’s sales data with me. Now I and my sales team could have instant access to our clients’ information. And I thought that someday we could even start understanding our customers’ needs better.

This was in 1986 and the computer was a Kaypro. It weighed 20 pounds and had a digital operating system with a then-unheard-of memory of 64K and two 5.5-inch floppy disks. I never got it working well, but it did prove that portable computing was the way of the sales organization’s future. Paul and I like anything that is truly brand new and that can be tinkered with. Yes, we even like having to try and decipher the incomplete operating manuals once we have tried to make it work on our own.

Innovators are the first group to evaluate any new disruptive or discontinuous inventions. If new inventions don’t pass this group’s approval, these “Innovator Gatekeepers” will help close the door to the advancement of your technology to the other larger more profitable buyer profiles. They see new technology adoption as a way to gain a competitive advantage.

Early Adopters represent the next stage in the buying curve and will range from about 7 to 15% of your total buyers.

Sometimes you can go straight into this group but most often you will have had to start building “Proof of Performance” with the Innovators.

In this market development phase, you will find the following characteristics:

  • Sales will start to grow rapidly, and profit margins will start to improve.

  • Pricing will be aimed at penetrating markets, with the objective of providing an increasing rate of return on investment for the purchase.

  • Competitors will start to appear; many of these will be under the auspices of major corporate entities.

  • Marketing objectives will be aimed at maximizing market share.

  • Strategic advantage will be gained by constantly introducing product extensions.

  • All advertising should be aimed directly at buying decision-makers and focused on creating awareness and interest. Direct marketing is usually the best avenue to developing markets.

  • The use of agents with already established buyers and reputations is usually more effective than creating a company-managed sales force.

  • The gathering of market intelligence and implementing of a Customer Relationship Management program is the key to continued growth and profitability by expanding your existing base with product extensions.

The hallmark of the Early Adopter is their ability to pose the primary question that must be answered in any presentation of a product, process or service, “This product will give you a competitive advantage and a Return on Investment (ROI) because it will …”

The Early Adopters are the buyers who once engaged, will:

  • Expand the uses of your product,

  • Give your product or service the credibility needed to enter the larger more conservative “Early Majority” market,

  • And provide the solid “proof of performance” you need to obtain the venture capital funding that will be required to mount marketing campaigns and expand production capabilities.

Vital points when dealing with the Early Adopter group are:

  1. Listening to them, because they will tell you your offering’s “Unique Selling Propositions” (USPs),

  2. Engaging them in active market research,

  3. Using their experience and endorsements as the key leverage points for growth.

Have you heard the i2p Podcast? Take a journey with Ross Blaine & Dr. Paul as they discuss concepts from the i2p book!

Don't forget to join our mailing list to be the first to know about everything going on in the i2p community.

“Early Majority” make up about 34% of total buyers. We undertook a Quality Service Study for a company in the traditional, totally risk-averse and price-sensitive industrial boiler industry. In this market, our client was dealing with engineers who were safety-conscious to a fault: always price-sensitive, and most importantly not willing to change their established ways of doing business.

The company had a great new technology, so new that the company used the word “Innovative” in its branding. Our research showed that buyers were not interested in new technology but were interested in safety, performance, user acceptance, the convenience of assembly, best price/performance statistics, dependability and often lowest capital cost.

In an industry of buyers whose profiles are that of the “Earlier Majority,” whose mandate is to make systems work effectively, and who preferred to buy from market leaders, remember the old adage: “no one has ever been fired for buying IBM.” Once our client moved to use initials instead of its full name with “Innovative” in it and started presenting a proven performance business case with exemplary service support, they started winning business.

You will know when you hit this buying group because you will start to experience the following:

  • Your team discussions are about defending the client’s market share.

  • The product brand is prominent.

  • Competitors are starting to diversify into other market segments and the sales process has become more intensive.

  • Sales reach their peak and profits are at their highest levels.

  • Client management is concerned about maintaining a Competitive Advantage.

  • New product development is well underway.

A WORD OF WARNING: This is when organizations are at the greatest risk. Your founding team will often be averse to change and resistant to new product development initiatives. In this phase, a sense of complacency is often prominent in that the founders are now experiencing increased incomes and moving from a focus on business development to focus on improved personal lifestyle; just look at Blackberry’s history.

To be effective at surviving and profiting in this phase, entrepreneurial ventures must move from being small, intimate businesses to have the infrastructure of large, multi-national organizations. Leadership must be focused on inspiring “Intrapreneurism” and strategic planning initiatives.

Make sure when dealing with decision-makers in the Early Majority profile that you are putting forward information that will demonstrate a “Return on Capital Employed” level of investment safety.

“Late Majority” is ultra-conservative and estimated at about 34% of the market. Indicators of this phase are:

  • A declining number of competitors.

  • Declining profits followed by declining sales.

  • Reduced advertising and management discussions focus on reducing expenses and milking the remaining time for the product in the marketplace.

These buyers only purchase when their own market presence is at risk. Late Majority buyers are only concerned with two criteria when they are forced to react and buy your offering to maintain their market share:

  1. Will this technology help me keep up with my competitors? You had better have quantified proof!

  2. Is this the lowest price I can have it for?

Nevertheless, this is the second-largest market segment, representing 20 to 40% of the market potential for a product.

The Late Majority is often the most difficult for a “non-established” company to penetrate. We often suggest that clients license or execute joint marketing agreements with established market players to penetrate this buying profile.

The best way to get your technology into the hands of the Late Majority is to have it integrated into a product or service that is provided by an established vendor.

“Laggards”, 7 to 15%, are change-averse. To try and sell them a new innovation is simply throwing good money after bad. Leave Laggards alone and let them come to you if they decide to or are forced to.

When Laggards do come, they will be extremely priced sensitive. They will be demanding and expect an unreasonable level of service, to the point of threatening you if you do not meet their excessive requirements and demands.

So, in conclusion, the best markets to target are the ones that have the will and are prepared to recognize that your product or process will improve their life/business style.

Have you heard the i2p Podcast? Take a journey with Ross Blaine & Dr. Paul as they discuss concepts from the i2p book!

Don't forget to join our mailing list to be the first to know about everything going on in the i2p community.


bottom of page