This document summarizes a lecture about the diffusion of innovation. It discusses how new ideas are developed through collaboration and exchange. It also discusses how innovations diffuse slowly at first, gaining momentum over time as they are adopted by pragmatists and conservatives seeking convenient solutions. The rate of adoption follows an S-curve, with innovators and enthusiasts driving early adoption and the mass market adopting later. Customers' motivations for adoption change over time, initially valuing the innovation's benefits and later valuing its functionality. Factors like network effects, convenience, and compatibility influence adoption rates.
8. Why is it that good products can fail and inferior – “good enough”
products can succeed?
What are the customers really buying?
Edison Phonograph Sony Betamax Apple Lisa
Example Products
13. Edison’s ideas for the phonograph
1. Letter writing and all kinds of dictation
2. Phonographic books, which will speak to blind people
3. The teaching of elocution.
4. Reproduction of music.
5. The "Family Record” ... and of the last words of dying persons.
6. Music-boxes and toys.
7. Clocks that should announce... time for going home, going to meals, etc.
8. The preservation of languages
9. Educational purposes
10. Connection with the telephone
http://memory.loc.gov/ammem/edhtml/edcyldr.html
16. Porn Industry was forced to adopt
rival VHS standard
Licensing and legal issues
Betamax standard tape was 60
minutes while VHS was 2 hours
Customers wanted to record and/
or rent movies
Betamax conclusion:
17. Development started 1978, release in
1983
Sold 100.000 machines
Featured preemptive multitasking OS
with Graphical User Interface
The vision was right
Technology just was not there —
Adjacent Possible
Lisa conclusion:
18. Customer are not always buying products for the reason
the inventor thinks
Customer Motivations
32. In the early days
The innovators and technology
enthusiasts drive the market
They demand technology
Small percentage of the market
In the later days
The pragmatists and conservatives
dominate; they want solutions and
convenience
The big market
The Law of Diffusion of Innovation
33. In the early days
THEY BUY FOR THE
WHY
In the later days
THEY BUY FOR THE
WHAT
The Law of Diffusion of Innovation
35. Lecture Exercise L06 - B
I EA EM LM L
1. Self-driving car
2. Drones
3. Home Robots
4. iPod
5. Assistant speakers
6. Digital cameras
7. Smart doorbells
8. Ride Service (Uber etc)
9. E-Scooter service
36. Why is Apple so
successful when other
companies fail?
37. APPLE WAS IRRELEVANT AND
ALMOST BANKRUPT IN 1997
IN 2012 IT WAS THE MOST
VALUABLE COMPANY
IN THE WORLD
41. Why do people wait in line for many hours to get a product you
can get by walking in just few days later?
And other products, cheaper, already do more
It makes no sense
42. The Triune Model
Simple model set proposed by physician and neuroscientist
Paul D. MacLean in the 1960s
The model is controversial and has been criticised for
simplifying the complexity of the brain
However, the model has gotten much attention and is a
useful way to think about people’s behaviour
43. The Triune Model
Logical (Neo Cortex):
Rational, analytical
thought, language
Emotional (Limbric System):
Feelings, trust, loyalty, behaviour,
decision making
Primal (Lizard):
Instincts, hunger, danger
The brain has three parts: Primal, Emotional and Logical
55. What caused the tipping point for the iPod?
Apple said it sold a record 22.7 million iPods,
which commands a 70% share of the U.S. market
for music players. (source: LA times)
56. No, it was not just simply the white earbuds
It’s the whole experience thing
62. Anderson’s Grand Unified Theory of Predicting the Future
All important technologies go through four states, or at least four
stages, in their lives. Each stage can be seen as a collision, with
something else. The stages are:
1. Critical Price
2. Critical Mass
3. Displace another technology
4. Become nearly free
Theory of Predicting the Future