An Innovation chasm signifies the slowdown or cessation of diffusion between two customer segments. Crossing the chasm refers to overcoming the pause of technology innovation diffusion between early adopters and early majority customer groups. Geoffrey Moore modified Rogers’ innovation diffusion theory to explain the diffusion gap between early adopters and the early majority of technology products. Hence, he came up with Crossing the Chasm book to explain technology innovation diffusion. Mr. Moore justified that a gap in innovation diffusion takes place due to varying social and cultural traits. He argued that chasm exists due to the high expectation gap between enthusiasts and visionaries of early adopters and pragmatists of the early majority. Therefore, Geoffrey Moore suggested customer segment-specific strategy, positioning, pricing, and distribution channels to cross the chasm.
However, due to cultural and social traits, upon diffusing through innovators and early adopters, will technology innovation give a pause before starting diffusing through the early majority? Such a reality is difficult to explain by considering social and cultural traits. Perhaps Geoffrey Moore’s justification in favor of the presence of Chasm does not appear to be acceptable. On the other hand, Rogers’ argument that chasm does not exist at all in technology innovation diffusion does not reflect reality.
Why does chasm form?
Perhaps the chasm exists due to the technology progression hurdle. Although we model the technology life cycle as a continuous S-curve, the reality may be different. Upon making specific progress, technology may stall and restart growing once certain scientific discoveries are made. Consequentially, innovation diffusion also may suffer from a brief pause. Such reality should be taken into consideration in bridging the chasm. To get further clarity, let’s look into some examples.
Examples of Chasm in Technology Innovations–raising questions about Geoffrey Moore’s crossing the chasm
Autonomous Vehicles Caught in Chasm:
Autonomous vehicle innovation diffusion has stopped after showing early success in diffusing through the military and warehouse market segments. Although customers in the early adopters category, like ride-sharing and taxi service companies, have been waiting for autonomous cars’ adoption, innovators cannot deliver them–raising the question of whether it is caught in death valley. Has this gap been created due to the expectation gap? Or has it been created due to a technology development hurdle in meeting the requirements? Hence, is it feasible to cross this chasm through marketing strategy?
Successive Better Versions of Mobile Phones have been Crossing the Chasm:
In 1984, Motorola’s Dynatec mobile handset was a 3lb brick. Early adopters were busy professionals. Out of necessity, instead of enthusiasm, they adopted it as a car phone. But other market segments like households, students, and others could not adopt it as it was too heavy to carry. Furthermore, the $3995 price tag did not justify the economics. Hence, there was a brief diffusion pause between early adopters and the early majority. However, mobile handsets kept diffusing as successive versions got better and cheaper. In retrospect, subsequent versions kept creating a series of wavelets of diffusion. At the micro level, there were numerous chasms between successive micro-segments crossed by consecutive versions. Innovators succeeded in crossing the chasm due to the continued progression of component technologies like semiconductors, displays, batteries, and software. Hence, Geoffrey Moore’s crossing the chasm theory does not justify the nature of chasm and the bridging way for the case of mobile phone diffusion.
Further lessons could be drawn from the emergence and evolution of smartphones. In 1994, after a sale of 50,000 units, the maiden iPhone (IBM’s Simon) got caught in the chasm. The subsequent evolution of smartphones led to crossing the chasm and creating a big success. Unfortunately, IBM failed to pursue this journey of creating success by crossing the chasm.
More than Decade long R&D Empowered Microwave Oven to Cross the Chasm
The 3rd example is the diffusion of microwave ovens. In 1945, Raytheon introduced a great kitchen innovation for quick food heating. It was about 6 feet tall, weighing more than 750 pounds, microwave oven. Early adopters of this $ 5,000 machine included high-end restaurants, navy ships, and others. However, households, the majority market segment, did not find 3KW powering consuming such a big machine suitable for kitchen equipment.
Hence, this extraordinary innovation faced the chasm. How was it addressed? Was Geoffrey Moore’s suggested customer segment-specific strategy, positioning, pricing, and distribution channel sufficient to cross the chasm? For sure, No. Upon envisioning the potential of diffusion of this great innovation through millions of household kitchens, Japanese companies got into serious R&D for the evolution. Almost a decade-long R&D led to making smaller, less energy-hungry countertop box. This countertop microwave oven also costs far less than Raytheon’s $ 5,000. Consequentially, microwave oven innovation crossed the chasm and kept diffusing through subsequent market segments.
Sustaining Innovation Strategy Underpins iPhone to Cross the Chasm
Even the magical iPhone did not keep diffusing through different market segments like how Rogers articulated innovation diffusion theory. Of course, enthusiasts and visionaries who were curious about Apple’s idea were the early adopters of the iPhone. But why did the iPhone 1 sales end after the diffusion of a little over 1 million? If Apple followed Geoffrey Moore’s advice, would the iPhone succeed in crossing the chasm, reaching the sale of more than 100 million units? For sure, No.
Instead, the release of the iPhone 3G helped the iPhone cross the Chasm. It’s not customer segment-specific pricing, position, and distribution channel that brought the success. In retrospect, Apple’s success in its sustaining innovation strategy, in releasing successive better versions, creating progressive waves, has provided added thrust to the iPhone to keep diffusion deeper through subsequent segments. The necessity of thrust obtained from successive versions for driving innovation is a must.
Hence, even higher-priced successive versions faced growing sales. For example, the iPhone 12, far more expensive than the iPhone 1, met sales of 100 million units within seven months of launch. Therefore, it’s no surprise that Apple’s exponential increase in R&D funding reached above $26 billion in 2022 from less than $500 million in 2001.
Nobel Prize-Winning Scientific Discover Needed to Let LED Light Bulb Cross the Chasm
A long advancement journey from Electroluminescence discovered in 1907 by the English experimenter H. J. Round led to the visible LED invention by General Electric in 1962. Subsequent advancement led to the diffusion of Green, Orange, and Red LED bulbs as indicators of instruments. Hence, the instrument market was the early adopter of LED light bulb innovation. However, the majority of the market for light bulbs was for lighting offices, households, and streets. Due to lack of intensity and fuzzy blue light, LED light bulb innovation got caught in the chasm.
Due to technological weakness, instead of social and cultural issues, the majority market segment did not respond. To bridge or cross the chasm, scientists got involved in knowing the hidden cause. Such exercise led to Nobel Prize-winning scientific discovery, which was leveraged to innovate bright, white, and sharp LED light bulbs. Consequentially, LED light bulbs crossed the chasm and started diffusing through the majority of market segments. Ironically, instead of inventor GE, follower Nichia succeeded in empowering LED light bulbs to cross the chasm.
There have been many such examples in the evolution of technological innovations. From OLED television to digital cameras, more or all technological innovations have a history of getting caught in one or multiple chasms and crossed them due to technological advancement. That does not necessarily mean that Rogers and Geoffrey Moore are entirely wrong with their theories in explaining technological diffusion.
Rogers Innovation Diffusion Theory—is innovativeness a continuous variable?
If innovation is a static and public good, innovation diffusion could be characterized as a social and cultural phenomenon. In such instance, Rogers’ Innovation Diffusion Theory makes good sense to defend his observation–innovativeness is a continuous variable. However, for technological innovations, innovation diffusion is a discontinuous variable. The underlying cause has been that technology does not keep growing linearly. Due to intermittence in technology progression, innovation diffusion also faces chasm in crossing market segments. However, in interpreting the diffusion pattern of a particular release of innovations, Rogers’ theorization of linear growth of S-curve-like patterns makes sense.
Why Do Chasms Exist in Technology Innovation Diffusion?
Identification of chasm by Geoffrey Moore in technology innovation diffusion appears to have merit. However, why does it happen once, only between early adopters and the early majority? Furthermore, Geoffrey Moore’s argument that it happens due to the social and cultural traits of the customers has weak merit. Instead, the more substantial reason has been intermittence in technology progression. As explained, innovation diffusion stalls after making initial progress due to the need for further technology development. Besides, the chasm will last until the needed technological advancement takes place. Sometimes, it may take decades-long R&D effort and Nobel Prize-winning scientific discoveries. Besides, technological advancement does not just face significant hurdles once. It may happen multiple times during the life cycle. Consequentially, the chasm in technology innovation diffusion may occur numerous times.
Crossing the chasm—why does Moore’s Crossing the Chasm fail to interpret reality?
As explained, chasms in the technology innovation path happen due to the technology advancement hurdles. Hence, progress in R&D plays a vital role in crossing the chasm. Although Geoffrey Moore’s suggestion, like market segment-specific strategy, positioning, pricing, and distribution channel, has merits, the suggested tactics are insufficient to cross the chasm caused by technology hurdles. Ironically, a significant cause of chasms in technology innovation is the R&D complexity of making innovations suitable for use and economically attractive for the next market segment. Hence, Rogers’ Innovation Diffusion theory and Geoffrey Moore’s crossing the chasm have significant limitations. To explain the technology innovation diffusion, they should be updated by detecting reoccurring patterns in real-life scenarios.
By the way, due to such imperfections of Rogers’ Innovation Diffusion theory and Geoffrey Moore’s crossing the chasm, innovators risk getting caught in the hype cycle and suffering from over-reliance on subsidies, marketing, and promotional activities. Furthermore, an innovation caught in the chasm during the early stage of diffusion may give entry an opportunity to outperform the incumbents in technology advancement and take away the innovation lead.
This article is part of a book, Engineering Economics and Management–Modern Day Perspective.