Adoption Process

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IntroductionIn this chapter we explore factors that encourage and discourageacceptance or rejection of new products and services. Specifically,we will understand the process of adoption of innovation thatis taken by consumers and also study the stages of adoptionprocess

ObjectivesAfter studying this lesson, you should be able to:• Understand the adoption process• Discuss the five stages in the consumer adoption process.• Profile the consumer innovator.• List and explain the personality traits of the consumer

innovator

Adoption ProcessAfter studying the last lesson you have a fair idea about theprocess of diffusion of innovation. Now let us concentrate onthe adoption process.The focus of this process is the stages through which anindividual consumer passes although arriving at a decision to tryor not to try or to continue using or to discontinue using a newproduct.What exactly is adoption of innovation?Customer acceptance of the innovation for continued use!We can thus define the adoption process as the mental processthrough which an individual passes from first hearing aninnovation to final adoption. (Philip Kotler).

Activity 1A large manufacturer of drug and personal grooming productswants to introduce a new toothpaste brand in addition to thethree already marketed. Evaluate for the firm what informationmight be used for innovation studies to guide introduction ofthe product.

Stages in the adoption process:Usually we have seen that the consumer moves through fivestages in arriving at a decision to purchase or reject a newproduct:• Awareness• Interest• Desire• Action

Fig 12.1 Stages of adopting new productsWE have already learnt about the stages in the adoption processin marketing management course in the earlier semester.

LESSON 33:ADOPTION PROCESS

Awareness Interest Evaluation Trial Adoption

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But, nevertheless, we are discussing the main characteristics ofeach stage and I am depicting the same in the form of a table asgiven in figure 12.1

Name of Stage

What happens during this stage

Example

Awareness

Consumer is first exposed to the product innovation

Rajesh sees an ad for a new digital camera in the newspaper

Interest Consumer is interested in the product and searches for additional information

Rajesh reads about the camera on the manufacturer’s web site, and then goes to a camera tore near his office and has a salesperson show him the camera.

Evaluation

Consumer decides whether or not to believe that this product or service will satisfy the need

After talking with a knowledgeable friend, Rajesh decides that his camera should be able to provide him with the photos he needs to use in PowerPoint presentations. He also likes the fact that it uses “standard” floppy disks for storage.

Trial Consumer uses the product on a limited basis

Since a camera cannot be “tried” like a bottle of new moisturising lotion, Rajesh buys the camera from a dealer offering a 14-day full refund policy.

Adoption/Rejection

If trial is favourable, consumer decides to use the product on a full. Rather than a limited basis-if unfavourable, the consumer decides to reject it.

Rajesh finds that the camera is easy to use and the results are excellent; consequently, he keeps the digital camera.

Fig 12.1 the stages in the Adoption process

Activity 2

Tick the correct choice

1. The shortest adoption process would be the adoption of_____.a. fashionb. fadsc. product classesd. brands

2. When Hewlett-Packard introduces its latest microchip at avery high price to consumers who are willing to pay topdollar for the latest technology, then gradually lowers theprice in a stepwise fashion to attract additional marketsegments, it is practicing a _____ strategy.a. market penetrationb. market skimmingc. diffusiond. product obsolescence

3. According to the five stages of the adoption process, aconsumer goes through the stages, starting out with thefirst stage which is _____.a. need recognitionb. awarenessc. interestd. trial

4. The stages in the adoption process end:a. with consumer trial of the product.b. with consumer adoption of the product.c. with consumer rejection of the product.d. either b or c

5. Personal and interpersonal sources become mostimportant in the _____ stage of the adoption process.a. awarenessb. trialc. adoptiond. evaluation

6. Which of the following is not a characteristic of theconsumer innovator?a. dogmaticb. have a need for uniquenessc. are inner-directedd. are variety seeking


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7. _____ is the degree of uncertainty or fear about theconsequences of a purchase that a consumer feels whenconsidering the purchase of a new product.a. Perceived riskb. Variety seekingc. Inner directednessd. Venturesomeness

8. Consumer innovators are likely to have all the followingmedia habits except:a. they have a greater total exposure to magazines.b. they are more likely to read general interest magazines.c. they are less likely to watch television.d. all the above are characteristics of consumer innovators

9. Demographics of consumer innovators are different fromnon-innovators. Which of the following is not necessarilya characteristic of a consumer innovator?a. relatively youngb. more likely to be formally educatedc. are financially more secured. more mail than female

Stages in the mental processing of an innovation:Here again we take a cursory glance at the processing thathappens inside our brain regarding any innovation. To identifythe stages in such processing, we can say that the following arethe stages:• Exposure• Information gathering• Evaluation• Trial adoption• Acceptance or rejection

A Profile of the Consumer Innovator

Who is a consumer innovator?Consumer innovators can be defined as the relatively smallgroup of consumers who are the earliest purchasers of anew product.The problem with this definition is the concept “earliest”!Innovators are defined as the first 2.5 percent of the socialsystem to adopt an innovation.In many marketing diffusion studies, however, the definitionof the consumer innovator has been derived from the status ofthe new product under investigation.Other researchers have defined innovators in terms of theirinnovativeness, that is, their purchase of some minimumnumber of new products from a selected group of newproducts.

Non-innovators would be defined as those who purchase noneor only one of the new fashion products.

Interest in the Product CategoryConsumer innovators are much more interested than eitherlater adopters or non-adopters in the product categories thatthey are among the first to purchase.Consumer innovators are more likely than non-innovators toseek information concerning their specific interests from avariety of informal and mass media sources.They are more likely to give greater deliberation to the purchaseof new products or services in their areas of interest than non-innovators.

The Innovator is an Opinion LeaderYou will see that there is a strong tendency for consumeropinion leaders to be innovators.Consumer innovators provide other consumers with informa-tion and advice about new products. Those who receive suchadvice frequently follow it.The consumer innovator often influences the acceptance orrejection of new products.When innovators are enthusiastic about a new product andencourage others to try it, the product is likely to receive broaderand quicker acceptance.Because motivated consumer innovators can influence the rateof acceptance or rejection of a new product, they influence itseventual success or failure.

Personality TraitsConsumer innovators generally are less dogmatic than non-innovators.Consistent with their open-mindedness, it appears thatinnovative behavior is an expression of an individuals’ needfor uniqueness.Still further, consumer innovators all differ from non-innova-tors in terms of social character.Consumer innovators are inner-directed.In contrast, non-innovators are other-directed.The initial purchasers of a new line of automobiles might beinner-directed, whereas the later purchasers of the sameautomobile might be other-directed.This suggests that as acceptance of a product progresses fromearly to later adopters, a gradual shift occurs in the personalitytype of adopters from inner-directedness to other-directedness.There also appears to be a link between optimum stimulationlevel and consumer innovativeness.Individuals who seek a lifestyle rich with novel, complex, andunusual experiences (i.e., high optimum stimulation levels) aremore willing to risk trying new products, to be innovative, toseek purchase-related information, and to accept new retailfacilities.Variety-seeking consumers tend to be brand switchers andpurchasers of innovative products and services.


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Perceived RiskPerceived risk is the degree of uncertainty or fear about theconsequences of a purchase that a consumer feels whenconsidering the purchase of a new product.Research on perceived risk and the trial of new productsoverwhelmingly indicates that the consumer innovator is a low-risk perceiver; that is, they experience little fear of trying newproducts or services.

Purchase and Consumption CharacteristicsConsumer innovators are less brand loyal.Consumer innovators are more likely to be deal-prone.Consumer innovators are also likely to be heavy users of theproduct category in which they innovate.Specifically, they purchase larger quantities and consume moreof the product than noninnovators.Finally, for products like VCRs, PCs, microwave ovens, 35-mmcameras, and food processors, usage variety is likely to be arelevant dimension of new product diffusion.To sum up, a positive relationship exists between innovativebehavior and heavy usage.

Media HabitsComparisons of the media habits of innovators andnoninnovators across such widely diverse areas of consumptionas fashion clothing and new automotive services suggest thatinnovators have somewhat greater total exposure to magazinesthan noninnovators, particularly to special-interest magazinesdevoted to the product category in which they innovate.Consumer innovators are also less likely to watch televisionthan noninnovators.Studies concerning the relationship between innovativebehavior and exposure to other mass media, such as radio andnewspapers, have been too few, and the results have been toovaried to draw any useful conclusions.

Social CharacteristicsConsumer innovators are more socially accepted and sociallyinvolved than noninnovators.This greater social acceptance and involvement of consumerinnovators may help explain why they function as effectiveopinion leaders.

Demographic CharacteristicsIt is reasonable to assume that the age of the consumerinnovator is related to the specific product category in which heor she innovates.Research suggests that consumer innovators tend to be youngerthan either later adopters or noninnovators.Probably because many of the products selected for researchattention are particularly attractive to younger consumers.Consumer innovators have more formal education, higherpersonal or family incomes, and are more likely to have higheroccupational status (to be professionals or hold managerialpositions) than later adopters or noninnovators.

Are There Generalized Consumer Innovators?Do consumer innovators in one product category tend tobe consumer innovators in other product categories?Not necessarily!The overlap of innovativeness across product categories, likeopinion leadership, seems to be limited to product categoriesthat are closely related to the same basic interest area.Such a pattern suggests that it is generally a good marketingstrategy to target a new product to consumers who were thefirst to try other products in the same basic product category.There is evidence that suggests that a new type of moregeneralized “high-tech” innovator does exist, that is, the“change leader.”Such individuals tend to embrace and popularize many of theinnovations that are ultimately accepted by the mainstreampopulation.They tend to have a wide range of personal and professionalcontacts representing different occupational and social groups;most often, these contacts tend to be “weak ties” or acquaintan-ces.Change leaders also appear to fall into one of two distinctgroups:A younger group can be characterized as being stimulation-seeking, sociable, and having high levels of fashion awareness.A middle-aged group is highly self-confident and has very highinformation-seeking needs.Similar to change leaders, “technophiles” are individuals whopurchase technologically advanced products soon after theirmarket debut.Such individuals tend to be technically curious people.Another group responding to technology are adults who arecategorized as “techthusiasts”—people who are most likely topurchase or subscribe to emerging products and services that aretechnologically oriented.These consumers are typically younger, better educated, andmore affluent.

Desirable Characteristics of InnovationsNow, let us see in brief, what should be the main characteristicsthat are desirable in any innovation.• Relative advantage–Is it better than existing products?• Perceived risk–How likely is it that the relative advantage

will accrue?• Complexity–How easy is the innovation to comprehend?• Communicability–Is the innovation socially visible?• Compatibility–Is it consistent with existing behaviours/

values?• Trialability–Can it be tried on a smaller scale?

Identifying Opinion Leaders and InnovatorsA very important part of our discussion on innovators andopinion leaders is how to identify them? Do they have anyfeatures or characteristics, which make them, stand out inpublic? Not always!


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But, for the purpose of making a category, we can definitelyidentify some characteristics.

Innovator characteristics include

• Risk taking• Variety seeking• Being in the upper socio-economic strata• Less well integrated socially• Opinion leader characteristics include:

• High involvement with the product• Socially well integrated• More exposed to a variety of media sources• In leadership positions in social, political and

community organisations

Resistance to innovationWe pause here to ask a question. If innovation is so good, whydo people resist innovation? This happens mainly because oftwo reasons: out of habit or because of some perceived risk.• Habit

A learned sequence of responses to previously encounteredstimuli

• Perceived riskPerformance risk•The product does not perform or hasharmful side effects.Social risk•Significant others might not approve ofinnovation adoption.

In figure 12.2 below we show a typology of innovationresistance and try to see how on the basis of these parameterswe can have different types of innovation resistances.

A typology of innovation resistance

Activity 3With the advancement of digital technology, some companiesplan to introduce interactive TV systems that will allow viewersto select films from “video libraries” and view them ondemand. Among people you know, identify two who are likelyto be the innovators for such a new service and constructconsumer profiles using the characteristics of consumerinnovators discussed in the text.

Risk

Low High Habit

Weak 1. No resistance innovations (new and improved versions of established product; fads and fashions)

3. Risk-resistance innovations (discontinuous and replacement innovations)

Strong 2. Habit-resistance innovations (continuous and replacement innovations)

4. Dual resistance innovations (social programs)

Fig 12.2 Innovation resistanceSource: Jagdish N. Sheth, ‘Psychology of innovation resistance:The less developed concept’, Research in Marketing 4, 1981, pp.273-82.


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Key Terms

• Adopter categories• Adoption process• Stages in the adoption process• Innovators• Laggards• Compatibility• Complexity• Triability• Observability• Usage barriers• Value barriers• Risk barriers• Relative Advantage• Discontinuous innovation• Continuous innovation• Dynamically continuous innovation

Article 1Media Innovation Can Overcome ADClutterIN an era marked by advertising clutter, a rethink on strategiesto make television advertising sizzle and sparkle is needed,according to Mr. Sam Balsara, Chairman and Managing Director,Madison Communications Pvt Ltd.“Conventionally, brand building copy plus media efficiencyresulted in brand power. Today, we additionally need mediainnovation to these inputs, which will result in Nuclear Power,”Mr Balsara told a delegation to Ad-Wise 2002, TV AirtimeSelling, Planning and Buying Forum, organised byIndiantelevision.com.Because of the brand clutter, advertising has failed to make animpact. Therefore, television’s share of the advertising pie maynot go to 60 per cent from the current 40 per cent. However,press advertising has begun to respond very well in the face ofcompetition from television.Mr. Balsara cited the example of the popular TV show ‘Rajni’,sponsored by Godrej. “The results were miraculous. Over oneyear, Godrej’s ad spend increased from Rs 1 crore to Rs 4 crore,”Mr. Balsara said.Similarly, in 1989, Cinthol Lime achieved 5.3 per cent share ofthe premium soap market in one month with media efficiency.“We just took eight spots on Mahabharat over four consecutiveSundays and we achieved this.’’Earlier, advertising was confined to prime time television. In2001, there were 32 lakh spots for 6.57 crore seconds ascompared to 24 lakh spots and 5.22 crore seconds in 2000.Mr. Balsara suggested six methods to achieve Nuclear Power -Invest in Programming, Maximise Salience, Push Brand Values,Attack Competition, Create Opportunities and Take Risks.According to Mr. Balsara, conventionally, companies were notaverse to risk. “Now companies are becoming risk averse whenit comes to media decisions,” he said.

Choosing Your Entry StrategyPioneering is associated with innovation. Companiesthat desire to pioneer need to invest their resources toinnovate their products and processes.

A human-like robot developed by Sony Corporation. Thecompany has constantly innovated its product offering and haspioneered a few categories.PIONEER or follow? This discussion has already taken upthree issues in this column. It’s time now to decide which fitsyour organization.In the previous issue, it was pointed out that the choice ofstrategy is not an absolute. Of course, it will depend to someextent on the industry features. More important, the correctstrategy in any given case depends upon a company’s competen-cies, and how aligned they can be to a particular strategy.Let’s begin with pioneering. If you think about it, this is closelylinked to innovation, the current buzzword. Almost everycompany we talk to wants to be more ‘innovative’. But whatdoes this word really mean? Does it mean just adding moreuseful features to existing products (like pilfer proof caps)? Ordoes it mean coming out with ‘first time’ products (likemosquito mats)? What about continually improving existingprocesses (like using hand-helds for the sales force)? And howabout a new media buying model?All these are innovations. But, the resources, processes andvalues needed to maximize the return from each of these arewidely different, and companies rarely excel at more than onetype of innovation. Indeed, it is very difficult to do so. So, ifyou want to pioneer a market, the first reality check is tounderstand your product innovation abilities. This is a complextopic (and we will come back to it in future articles), but fornow, ask yourself this question: Can we, year after year, come upwith a series of truly new products (like 3M and Gillette), or isour product innovation process more suited to incrementalimprovements in existing products (like a new soap perfume,or a powdered drink with better solubility)? If the answer is thelatter, pioneering is obviously not for your organization. Unless


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you can make a determined effort to alter mindsets and abilitiestowards innovation.Closely related, and of particular importance in consumermarketing, is the level and type of marketing skills. For aninnovation in an industrial product, the benefits are, or shouldbe, obvious to the end-user. In consumer goods, they have tobe communicated strongly and convincingly. For example, anew industrial coating that lasts twice as long as existing ones ata small premium will practically sell itself. But in house paints,convincing consumers to pay a premium for a new technologyexterior paint is far more difficult, and needs a different type ofmarketing skill. The question here is: Can we effectively educatethe consumer and create a new market by communicating theadvantages of a totally new concept, or are we better at commu-nicating the benefits of our product vis-à-vis competingproducts?The fact is that for a majority of companies, pioneering as astrategy is not an easy option. This does not mean that they cannever have a ‘killer’ idea, but rather, that such an idea will be theexception rather than the rule. Actually, the 3M or Gillette levelof pioneering is extremely demanding, and very few companiescan sustain the pace. Most of them fall into the second category,with processes geared towards incremental improvements,enlivened by occasional flashes of disruptive product innova-tion.If you are to follow, the obvious question is - how best can youenter a market as a follower? This is where a complex interplaybetween your resources and innovation ability, and that of thedominant incumbent comes in. Further, it is easier to mount asuccessful attack if there is dissatisfaction with the current leader,than if it is perceived to be of high quality. In a framework forlate entrant strategies, Shankar and Krishnamurthi haveproposed eight options. These range from a niche strategy to aninnovation-led strategy, with the applicability depending on thechallenger’s level of resources, ability to innovate, and thedominant incumbent’s perceived product quality.Being a late entrant is not a bad idea - business history is repletewith cases where late entrants have eventually outsold pioneers.The point is that what works for one company may be disas-trous for another. In fact, the key issue in developing an entrystrategy is a dispassionate appraisal of your own weaknesses, aprocess that is far more difficult than it sounds.

Points To Remember

Adoption process

We can thus define the adoption process as the mental process

through which an individual passes from first hearing an innovation to

final adoption. (Philip Kotler).

Stages in the adoption process

• Awareness• Interest• Evaluation• Trial• Adoption/Rejection


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Stages in the mental processing of an innovation

• Exposure• Information gathering• Evaluation• Trial adoption• Acceptance or rejection

Desirable characteristics of innovations

• Relative advantage• Perceived risk• Complexity•Communicability• Compatibility• Trialability

Innovator characteristics

• Risk taking• Variety seeking• Being in the upper socio-economic strata• Less well integrated socially

Resistance to innovation

• Habit

• Perceived risk


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A typology of innovation resistance

• No resistance innovations• Habit-resistance innovations • . Risk-resistance innovations • Dual resistance innovations

Notes

Adoption Process

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