1) What are the primary advantages to a manager of understanding & managing Rogers Five

Product Based Diffusion Factors?

Rogers Five Product Based Diffusion Factors can be an extremely useful tool for managers when selling any type of product. A study done by Everett Rogers has suggested that 49% to 87% of the variance in the rate of new product adoption can be explained by five product-based characteristics, known as Rogers Five Product Based Diffusion Factors. Managers who take into account these product differences can create a great advantage when predicting and managing their products diffusion. This is especially true because, often, managers do not pay as much attention to product differences, when compared to people differences. Once managers understand and make use of Rogers Five Product Based Diffusion Factors, they can quickly be able to benefit from it. Firstly, managers can use these factors to better anticipate the likelihood that an innovation or product would be adopted. Secondly, managers can intentionally apply these factors as guidelines to develop a product. This way, manager can potentially reduce the risk of having a product with a low rate of adoption. Thirdly, managers can draw on factors that a particular innovation is successful in while actively attempting to overcome factors that a particular innovation does poorly in. Though not noted in the article, whats especially valuable about these factors is its ability to be used at any stage of a product. Rogers Five Product Based Diffusion Factors can provide managers a pathway for a new product to succeed. To amplify the rate of adoption for any product, Roger states that managers should seek to increase a products relative advantage, the degree to which a product is better than the product it replaces. This may include reduced cost,

greater productivity, or subjective benefits such as prestige. Next, managers should increase compatibility, the degree to which a product is consistent with existing values and experiences. While this may not apply to some industries such as movies, movies, and clothing, most industries would agree that an innovation that is compatible with existing concepts is less threatening, seems more familiar, and fits more closely with a persons impression of the way things ought to be. Complexity, the degree to which a product is difficult to understand and use, is a product factor that appears to be inversely related to the rate of adoption. Thus, managers should try to avoid complexity when looking to increase product adoptions rates. Roger notes that Trialability, the degree to which a product may be experimented with on a limited basis, can also greatly affect the rate of adoption of any particular product. By increasing trialability, sometimes through offering free samples, managers can potentially increase the rate of adoption. Finally, Roger indicates that observability, the degree to which product usage and impact are visible to others, is positively correlated with the rate of adoption for a product. Since highly observable products may spur others to adopt the same new product, this can be an important method to increasing customer purchases. In conclusion, managers should aim to increase perception of relative advantage, compatibility, trialability, and observability for their product while decrease the perception of complexity.

2) Consumer digital cameras were adopted slowly until their retail price point hit $299 & they were
capable of producing 35mm quality prints in the early 2000s. Thereafter, consumer adoption was rapid. Explain these observed market dynamics in light of Rogers Five Product Factors.

To understand why digital cameras were adopted slowly prior to the early 2000s and had a sudden increase in adoption thereafter, lets benchmark the key factors and changes of this product to Rogers Five Product-Based Diffusion Factors: Relative Advantage: In the early 2000s, digital camera hit a retail price point of $299. Because of the products decrease in cost, relative advantage went up. Since relative advantage is positively correlated with rate of adoption, results showing that rate of adoption increased during this time is as expected in Rogers theory. Furthermore, during the same time, the digital camera increased capabilities when being able to produce 35mm quality prints. Due to increased benefits, relative advantage went up. Once again, as the relative advantage increased, rate of adoption also increased. Ultimately, economic and increased benefits led to the rapid adoption of digital cameras in the early 2000s. Observability: We must note that, as the rate of adoption increases, observability increase. Thus, an increase in visibility to others might encourage others to adopt the same new product. Trialability: We must also note that, as the rate of adoption increases, trialability can potentially increase. This is because people can test products from friends, family, colleagues, and peers. The increase in trialability will further increase the rate of adoption.

In this scenario, information regarding complexity and compatibility were not included. Although not referenced, hypothetically, if complexity was decreased and compatibility was increased, result would reflect digital cameras to have a higher rate of adoption.

3) The Segway Human Transporter is a self-balancing motorized scooter costing just under $5000.

While greatly hyped as a technological breakthrough, the market sales for the Segway Scooter fell well short of expectations. At present, Segways are still more of a market curiosity than a mainstream device. Could this result have been anticipated based on consideration of Rogers Five Factors? As the Segway Marketing Manager, what could you have done differently?

When considering Rogers Five Product-Based Diffusion Factors, we could have anticipated the poor result of Segway Human Transporter. Firstly, with prices at approximately $5000, relative advantage is low. It is highly unlikely to mainstream this product at the given price. Furthermore, subjective benefits such as prestige, is questionable. While some people may find the product to be cool others may find it to be silly. This can also have a negative effect on relative advantage. With little relative advantage, low rates of adoption could have been foreseen. Secondly, since walking is more intuitive and there is little consistency with existing values and experiences, compatibility is low. Moreover, the inability to use stairs while on the device may decrease existing values. Low compatibility is another reason that there is a low rate of adoption. Thirdly, the Segway Human Transporter can be considered to be complex for may people. Because the device is based on your ability to balance on it correctly, it may deter people from using the device. This increase in complexity may have been one of the reasons the scooter fell short of expectations. Fourthly, there is little trialability with this product. Personally, I have never seen or encountered an actual Segway that was available to try. Thus, even though I am curious, I have never considered purchasing it simply because Ive never been given the chance to try it. Low trialability can severely decrease rate of adoption. Finally, with a small portion of the population who actually has this product, it is rare to see it. Moreover, as I mentioned earlier, in my experience, I have never seen a store that has sold the product, which further decreases observability. Since observability is low, we could have predicted low rates of adoption. Overall, using Rogers Five

Product-Based Diffusion Factors, we could have projected the poor adoption of the Segway Human Transporter. Manager could take a number of steps to help increase the rate of adoption for the Segway Human Transporter. First, managers should take steps to help increase perceived benefits of the product to all groups. By increasing benefits, we are ultimately increasing relative advantage. Furthermore, managers should actively advertise the product to associate it with ones prestige. This way, customers will want to purchase the product to increase social status. This will also increase the rate of adoption through targeting relative advantage. Second, complexity can be decreased among customer through the use of instructions and tutorials. By decreasing complexity, managers will be able to increase rate of adoption. Third, managers should also take steps to offer the product in high-traffic shopping areas such as malls in an effort to increase observability. Also, these products could be sold in all technology based stores, such as Best Buy to further increase observability. This would attract all groups and help to mainstream the product. Fourth, trialability can be increased if customers can be given the opportunity to, not only, use the product in stores but also use the product outside of stores. For example, the company of Segway Human Transporter should let customers rent the product while shopping at the mall. This would increase trialability as well as observability. Finally, managers should take steps to increase perceived compatibility. We should note that, a managers responsibility is to manage not only the objective characteristics of an innovation but also the characteristics of that innovation as perceived by individuals.