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What Is the Product Adoption Curve and How Is It Important?

In this article, I will dig deep into "The Product Adoption Curve" theory: What it is, how it was invented and how this theory can be used in SaaS.
Category
User Onboarding
Written by
Hilal Yıldırım
Published on
August 1, 2022

What do you think about the Metaverse?

Do you think it's a scam, or did you already buy some land or NFTs to take your place?

How about this: the speculation that happened around the Metaverse is not only limited to it. People always find something new, invest in it, or criticize it, and promoters and detractors are always around any product on the market.

The reason why this happens is The Product Adoption Curve theory.

In this article, I will dig deep into:

  • What it is,
  • When and how it was invented,
  • What the five stages of product adoption are,
  • And how this theory can be used in SaaS.

Let's begin with:

What Is the Product Adoption Curve?

The product adoption curve (or the technology adoption curve) showcases how different segments of users behave while adopting a certain product, and examines the behaviors of each segment. Doing so helps product teams set clearer goals for the product adoption rate and helps the management team prepare for what's (or who's) to come.

This is what it looks like for those who aren't much familiar with the adoption curve concept:

source

 

As you can tell, there are five different types of customer segments during the adoption process:

  1. Innovators
  2. Early adopters
  3. Early Majority
  4. Late Majority
  5. Laggards

Each segment has different behaviors, advantages, and key factors to be aware of.

Before we get into that, let's take a look at the background of this theory:

Who invented the product adoption curve?

The idea was first introduced by Geoffrey Moore, a theorist and a management consultant from the USA, but the stages were a bit more different at the beginning. There were only four user personas, excluding the innovators.

40 years later, the theory has been evaluated and updated by Everett M. Rogers, an American sociologist. Everett Rogers collected all his ideas in the book, Diffusion of Innovations.

He definitely had no intention of influencing the SaaS market in 1962 - which is when the book came out - but his theory was so on point that it has been adopted by many different markets.

 Fun fact: the graph was supposed to be a production adoption curve for hybrid seed corn farmers.

So, now it's time to see what this theory is all about:

What Are the 5 Adopter Categories?

1- Innovators (2.5%)

The innovators are the risk-takers who value "being new" over the actual services.

These people are big tech enthusiasts, and they are often quite tech-savvy.

But they are also like kids in a sense. Here is what I mean:

  • They won't keep playing with your tool as soon as they don't find it entertaining anymore.
  • They aren't disturbed by minor technical issues. They want to experience the product as a whole.
  • They like to take risks, and that's mostly the sole reason they decided to try your product.
  • They don't qualify as a potential customer since they don't intend on spending more money on you.
  • They don't care if your product succeeds or fails. They just want to enjoy what they have in their hands.

But the innovators are still a crucial part of your product adoption process since their feedback will provide all the things that grab the attention of our next segment.

Key Points:

✅ Innovators provide a perfect user base to be beta testers and will provide high-quality, in-depth user feedback for your new product.

❌ These people aren't really interested in the value you provide, so their customer lifetime will be short and won't provide much for your conversion rate. In other words, they won't stick around for long or spend money on your product.

2- Early Adopters (13.5%)

Early adopters also find your product in a short period of time, where you haven't fully developed yet (in most cases).

These are the first people who actually want to benefit from all your services. In other words, they are your first true active users.

They are mostly tech people who want to try things as soon as they come out as well.

Well, this small group is pretty similar to innovators in most ways, except for this one major difference:

Early adopters are more selective about what to recommend.

So if they don't see a bright future for you, they won't be recommending your product to others, so they won't be increasing your rate of adoption much.

Which takes you to the Chasm Moment.

Key Points:

✅ Early adopters are more likely to contribute to your development in the target market than the innovators. They will give feedback, write reviews, recommend you to others, and could even spend a lot of money on you if they are convinced about your potential.

❌ It is difficult to convince the early adopters that your star shines bright. If you can't make it past the "early adopters" stage, you won't find a place in mass markets.

Critical: The Chasm Moment

While Geoffrey A. Moore was researching his theory of the technology adoption curve, he realized that most products are prone to fail at the exact same stage.

Right after the Early Adopters phase.

sour

 

As he further explains this moment in his book, "Crossing The Chasm," that exact point is when you cross from the "early market" into the "mainstream market," where you will gain your actual revenue.

If you fail to connect this Chasm Gap - the gap from early adopters to mainstream customers - you failed to plan the diffusion process correctly. 

So what do you do to not get stuck in this phase?

The answer is: you know the behaviors and needs of the mainstream market:

3- Early Majority (34%)

The Early Majority consists of people who have done their research, and are convinced that you are the best solution to their problem.

They make your first firm customer base that is ready to pay whatever it takes to get that solution from you.

These people probably have heard of your popularity, but the data you provide drives them to select your devices. In other words, unlike innovators and early adopters, you have to have actual proof of perfection to get the early majority on your side.

As Moore explains it in his book, this pragmatic majority relies on the recommendation of one another, and not anyone else from any other segment.

This can be a big obstacle to your growth, since the very people that provide the best word-of-mouth marketing are the early adopters, but the early majority usually doesn't listen to them.

Key Points:

✅ They are the first people who actually need your product and want to pay for the solutions that you provide. Also, if you have gotten to the early majority stage, you have overcome the chasm, and your chances of success are a lot higher than before.

❌ They are more difficult to convince since they require data-supported proof and recommendations from one another.

4- Late majority (34%)

The late majority, also referred to as the late adopters, are mostly more skeptical people who need more proof than value or popularity.

What else is there to prove?

Worth.

You need to prove that you are user-friendly, worth their time, and most importantly, worth changing their previous habits.

The late majority usually consists of elderly people who already have solutions to most problems - even though they realize that their solutions are outdated.

Think of Facebook; who do you think is the late majority on Facebook?

It's the moms. They haven't used Facebook for years. They didn't even allow their children to spend too much time on the platform. Now, they might even be addicted to seeing each other's updates.

The late majority isn't a small portion; therefore, you can't ignore them and try to remain on the mass markets with the early majority only.

If your product managers aim for widespread adoption, you have to count every potential adopter in the equation, including the late majority.

Well, there is actually one category that negatively affects customer success, the next one.

Key Points:

✅ The late majority is not impossible to convince. They only need more time and proof. Your job is to remain around and provide the proof so that they have a smooth product adoption process.

❌ If you disregard the late majority and only aim for early majorities, your customer base won't expand enough to bring you to a competitive edge on the market.

5- Laggards (16%)

The laggards won't come on board unless they have any other option.

To give you an example, if the world changed today and we wouldn't be using any currency except for crypto, the laggards would continue to use current cash among themselves.

There are two reasons why they could negatively affect customer success:

  1. They are not a small proportion; if you can't convince them, you will be missing out on a huge amount of potential customers.
  2. If they strongly believe in their old-school methods and you somehow got to their nerves (just like Facebook once did and cryptocurrencies do now), they might even detract you.

Also, bear in mind that laggards are not customers.

It is true that the laggards have no interest whatsoever in your services, and they are there because they had to, but this doesn't mean that they will pay for your services.

When the laggards start getting onboard, it's time to make some changes to your product because now you know that you are prone to become outdated in today's quickly changing world. Having reached the point where even the laggards show a bit of interest in your services means that you can't remain the same for long.

Key Points:

✅ Getting the laggards onboard means that you have entered your decline phase. So their arrival means that it's time to make some changes for your own sake.

❌ Laggards are not customers, but not being able to get them on board could cause you a lot of revenue since the number of laggards isn't as low as you might think.

How Can Product Adoption Curve Be Used for SaaS?

I hope I could clarify the differences between different categories of adopters and explained their needs.

Now it's time to focus on your needs.

How can you use all this information to bring your SaaS product to success?

In four simple steps:

Incorporate different marketing strategies for different adoption stages

Let's go over what each segment needs again:

  1. Innovators: They don't really need much.
  2. Early Adopters: They need a spark of your promising future.
  3. Early Majority: They need proof that you can solve their problems.
  4. Late Majority: They need proof, reviews, time, and a smooth technology adoption journey.
  5. Laggards: They need to be left with no other choice.

If you show statistical data to the early market, they won't get excited.

You will get stuck in the chasm if you try to convince the mainstream market with promises rather than facts.

That's why you must incorporate different tones of voice in your copy and your visuals while advertising or promoting your product for the two different stages.

Segmentate your marketing campaigns

There are five different segments of technology adoption.

It won't last long if you stick to only one during the whole product lifecycle.

Take Facebook as an example. At first, they were promising connections throughout the world for everyone. (aiming for the early market seeking for enthusiasts.)

Then, they started promoting the number of features that they have. (aiming for the early majority to see how easy it is to function and worth their time)

And lastly, they focused on how every single person on earth is sharing their knowledge and experiences on the platform. (aiming for the late majority and laggards to show them that it's a worldwide accepted fact)

What happened next?

It evolved. They became Meta. With the whole world, including the laggards joining them, they knew they had to change.

Get all users onboard smoothly

So how did Facebook do this? Was facebook just perfectly qualified to become such a success?

No.

It wasn't the first social media platform around, and neither was it the last.

But Facebook was the easiest to use even though it was also the most comprehensive during its time.

They managed to keep the customer lifecycle long because they had an amazing onboarding flow that pushed users to add friends immediately and start sharing right away.

Very long.

18-years long.

Be patient but don't stop adapting to the market needs

Facebook was created in 2004, and for 18 years, it grew steadily. It remained the name, made some changes to the interface and functionality every now and then, but they were patient for 18 years.

And now they are Meta.

You could be too.

 

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