In this lesson, you will learn about the consumer adoption process for products. Specifically, this lesson will cover:
1. Consumer Perception of Newness
Just as there are different ways to categorize new products, there are different customer perceptions of newness. The difference in these perceptions is the result of how much change they cause in a consumer’s existing habits. Newness can be categorized three ways: discontinuous innovation, continuous innovation, and dynamically continuous innovation.
Sometimes referred to as radical or disruptive innovations, discontinuous innovations consist of new-to-the-world products that are so different from products currently existing in the market that they require a significant change in consumer behavior when adopted.
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Think about how cell phones have changed the way we communicate today. Older cell phones did one thing—make and receive phone calls. With a smartphone, you can still make phone calls, but you can also listen to music, send and receive emails, surf the Internet, conduct online banking, and get driving directions, to name just a few. Consider how learning to operate all the features on your smartphone required you to change your behavior.
Continuous innovation is the other end of the spectrum from discontinuous innovation. With continuous innovation, the existing product undergoes marginal changes and doesn’t alter customer habits. For example, when Sony introduced new TVs that promised sharper, brighter TV pictures, the picture quality was better, but as a consumer, it didn’t require you to change your TV viewing habits.
With dynamically continuous innovation, some changes in consumer habits are necessary, but the changes aren’t as large or small as you see with the two other types of innovation. For example, manual and even electric typewriters have gone the way of the dinosaur since the advent of PCs, but the keyboard layout remained the same, so little change was required with consumer habits.
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- Discontinuous Innovations
- Innovations that consist of new-to-the-world products that are so different from products currently existing in the market that they require a significant change in consumer behavior when adopted.
- Continuous Innovation
- The existing product undergoes marginal changes and doesn’t alter customer habits.
- Dynamically Continuous Innovation
- When some changes in consumer habits are necessary, but the changes aren’t as large or small as you see with the two other types of innovation.
1a. Stages in the Consumer Adoption Process
Consumers go through five stages in the process of adopting a new product: product awareness, product interest, product evaluation, product trial, and product adoption.
Let’s look at each of these stages in the consumer adoption process in some detail.
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Stage 1: Product Awareness. The first stage in the consumer adoption process is simply creating awareness that the product is available, so the company develops a successful marketing strategy to make customers cognizant of the new product. This strategy might include creating a strong presence for the product in social media, for example. The goal here is to reach as many customers as possible at a relatively low cost. Let’s assume for a minute that you’re watching a football game on Saturday afternoon, and you see a television commercial for a mouthwash that whitens your teeth while you rinse. You’re now aware of the product, thanks to that commercial!
Stage 2: Product Interest. In this stage, consumers are aware of the product, and it has piqued their interest. The company should guide consumers by providing easily accessible information on the product, such as a website, blog posts, tutorials, or instructional videos. Let’s go back to our mouthwash example. You’re intrigued with the concept that a mouthwash can whiten your teeth, so you call your brother who is a dentist to ask if he’s familiar with the product and what he has to say about it. That’s product interest.
Stage 3: Product Evaluation. Before they buy it, consumers will typically examine, compare, and evaluate the product. They haven’t purchased it yet, and they often look to social media channels, such as online reviews and recommendations, to see how other consumers feel about the product or service. Think about it: How many times have you viewed customer reviews on Amazon prior to purchasing a product? In our example of the mouthwash, you might do an Internet search to read reviews of the product before you actually purchase it. That’s product evaluation.
Stage 4: Product Trial. This is the stage in the consumer adoption process where the consumer actually tries the product out. It might be a free sample in a retail store or a “100 percent money-back guarantee” trial purchase of an online product. This is also the stage in which marketers are hoping that the product will deliver on consumer expectations.
Stage 5: Product Adoption. When consumers enter this phase, they’re ready to buy, whether it’s online or in a retail store. As a marketer, hopefully you’ve made the acquisition and payment process as seamless as possible so that your customers can easily obtain your product.
It should be noted that there are five characteristics of innovation, and each affects the rate of adoption differently. This is also known as the process of diffusion of innovation—the process through which new products are adopted (or not) by customers.
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Let’s take a look:
- Relative Advantage: How much is the new product “better than” what it replaces? This is, of course, based entirely on a consumer’s perception, but as a general rule, the easier it is to recognize the advantages of using the product, the more quickly it will be adopted.
- Compatibility: This is the level at which the innovation fits into a specific society due to economic, lifestyle, and cultural reasons. For example, PCs were very compatible with middle-class lifestyles, so the product was quickly adopted. On the other hand, the diffusion of birth control in parts of the world is not compatible with social mores due to religious beliefs and cultural values.
- Complexity: How difficult is the new product for the adopter to understand and use? If the difficulty level is too high, it is less likely that adoption/diffusion will take place. Think about your own experiences: Have you ever returned a product because it was too complicated to use? An example of a too-complicated product for the market was Google Glass. It was designed by Google to make it easy for consumers to access content, accept phone calls, and use social media platforms to search for content and stay up-to-date with posts from friends and family. The catch? The glass was promoted as a hands-free way to do this through the glasses while doing other things… which, as any consumer who multitasks knows, could include driving and walking. The company officially discontinued design in late 2023. Perhaps the price of $1,500 was prohibitive, but technology experts think it was just too much immersion in glasses while consumers could be doing other things, which could create an absolute overload of content.
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Divisibility: Divisibility is the ability to give the product a “test run” before putting down your hard-earned cash. For example, in no small part due to the COVID-19 pandemic, some online car sellers like Carvana and Shift, as well as some car dealerships, have adopted touchless test drives. The car is brought to the shopper’s home, it’s wiped down with disinfectant, and the consumer takes the car for a test drive alone while the delivery person waits.
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Communicability: You may know your product is great, but you need to be able to effectively communicate to your audience. Communicability is the ability to effectively communicate the benefits and results of using the product, and when those benefits and results are both observable and describable to others. Let’s imagine for a moment that you’ve purchased an expensive Peloton bike to get in shape after the new year. Would you continue to use it if you didn’t see the desired results? Perhaps even more importantly in terms of communicability, would you be willing to share your results with others if those results weren’t favorable?
It was first thought that diffusion was a one-step process: from mass media (i.e., advertising) to the individual. Marketers now recognize that it is a two-step process, and the second step is personal influence—that is, communication between individuals in which individuals can affect the purchasing decision of others because of their authority, knowledge, or position. For example, Kylie Jenner is a powerful social media influencer with over 250 million followers on Instagram.
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- Diffusion of Innovation
- The process through which new products are adopted (or not) by customers.
- Divisibility
- The ability to give the product a “test run” before putting down your hard-earned cash.
- Communicability
- Ability to effectively communicate the benefits and results of using the product, and when those benefits and results are both observable and describable to others.
- Personal Influence
- Communication between individuals in which individuals can affect the purchasing decision of others because of their authority, knowledge, or position.
1b. New Product Adopter Categories
Consumers adopt new products at their own speed. Some want to have the “latest and the greatest” as soon as it is available. If you doubt that, just look at the lines around any Apple store on the day of a new product release. Others tend to wait a while before buying. Scholar and professor of sociology at The Ohio State University Everett Rogers is credited with introducing the diffusion of innovation theory in 1962, in which he explained how a product or idea gains momentum and spreads through a population or society. In his theory, he identified five adopter categories.
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Let’s look at each of these categories in a little more depth.
Innovators: These consumers are the risk-takers in the market. As a general rule, they have higher-than-average income and are typically well-educated. They enjoy the “rush” of taking risk but are also willing to accept the consequences of failure. It’s the innovators who buy new products as soon as they hit the market.
Early Adopters: These consumers are the best target market for new innovations. These people tend to be well-educated “opinion leaders” with neighbors and friends, and their product advice is generally accepted more readily than product advice provided by innovators.
Early Majority: These consumers typically look to the innovators and early adopters to determine if the new product meets expectations because they don’t want to take the risk of being the first to adopt the new product, but they do accept innovation before the “average person.” This group of consumers is typically above average in terms of education and income but also tend to be “followers” in their social group.
Late Majority: These consumers are typically slow to catch on to the popularity of new services, products, ideas, or solutions. About 34 percent of the population will buy a new product after only about half of the population does. They’re not interested in the “bells and whistles” (i.e., functionality and benefits) of the “latest model” and want simple, cost-effective products that focus on specific uses. As a general rule, their income and education are limited, and they’re typically unwilling to take a chance with a new product unless the majority of consumers have already adopted the innovation.
Laggards: Laggards are more in tune with the past than the future, and they’re leery of new ideas. By the time they adopt a product, there’s probably already a new version or innovation taking its place.
In this lesson, you learned about consumer perception of newness. The difference in how consumers perceive product newness is the result of how much change the product causes in a consumer’s existing habits. Newness can be categorized three ways: discontinuous innovation, continuous innovation, and dynamically continuous innovation. Consumers go through five stages in the consumer adoption process: product awareness, product interest, product evaluation, product trial, and product adoption. You also learned about new product adopter categories and that consumers adopt new products at their own speed in five categories: innovators, early adopters, early majority, late majority, laggards.
