It seeks to explain adoption of an innovative product or service over time among a group of potential buyers Lack of awareness &

limited distribution typically limit early adoption Diffusion theory is useful to managers in predicting the likely adoption rate for new and innovative goods and services

 Individual is exposed to the innovation

Awareness

Becomes a prospect

Interest

Prospect is interested enough to seek information

Mental Rehearsal stage

Prospect judges the advantages and disadvantages of a product and decides Evaluation whether to try it

Trial

Prospect tries the product on limited basis

Adoption

Prospect decides whether to use the innovation on a regular basis

Factors Relative advantage Compatibility Complexity Trialability Observability Risk

If factor is

then adoption rate is