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Sep 30 11

Diffusion of Innovations

by Adam Ayers

Wikipedia defines Diffusion of Innovations as a theory that seeks to explain how, why, and at what rate new ideas and technology spread through cultures.

I personally use the principles of Diffusion of Innovations most when strategizing with fledgling startups on how to take their products to market. The principal lesson learned is that you can’t develop a product that is all things to all people and take it to market and expect all those people to understand all the things it can do for them right away. Instead choose your target audience, those people who can’t live without your product, those people who when they see your product will say,
“Holy Shit this product was made for me!”. I think the reason that this works is because startups have limited resources in both development and marketing. By focusing your product toward an initial audience it allows you to focus your limited resources on a handful of people as opposed to the masses.

I think the best known example of applying this concept to gain mass market share is Facebook. Facebook didn’t start off by saying, “We can be a place where everyone in the world communicates to each other, shares their experiences, plays games, and buys products” instead they focused on building an extremely niche product for a very limited audience. Mark Zuckerburg built Facebook to be a way to glimpse into the personal lives of other students at his University. Immediately the “early adopters”, his classmates at Harvard began to adopt the product and Mark and his team focused on building a wonderful user experience and valuable social tool for that slim audience. Through customer feedback and exclusivity Facebook was able to jump past the competition (Myspace) and follow the S curve to majority marketshare.

Additionally, I attribute a large part of Facebook’s success on their ability to quickly choose a target audience, identify a problem, and immediately start solving the problem through series of iterations and customer feedback. I’ve seen way too many companies spend months married to an initial idea or technology without ever considering who their initial target audience (the early adopters) are. As a result they often tend to struggle when it comes to attracting talent, customers, and funding.

At Arkayne we focused on local bloggers as our “innovators” and “early adopters”, not only were they willing to try out our technology on their blogs, but they were also direct feedback channels for us. This allowed us to mature our offering and ultimately made our technology far more valuable for our Enterprise customers who were willing to pay for the product because it solved major content curation and linking problems that they faced daily at their business, in a very scalable and cost effective manner.

At MOEO we are focusing on the die hard sports fans to adopt our games first, give us feedback, and ultimately invite their friends and family (a more casual audience) to use our games.

I’d love to hear of other success stories and failures pertaining to the principles of Diffusion of Innovations, feel free to share them below in the comments!