What is Diffusion of innovation?

Process by which an innovation is

communicated through certain channels
over time among the members of a social
system.

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Why an innovation is adopted or rejected?

Why do certain innovations spread

more quickly than others?

Why is it faster in some countries or

regions than others?

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 Answer:

Several intrinsic characteristics of

innovations that influence an
individual’s decision to adopt or
reject, pace or slow down an
innovation.

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They are:

– Relative Advantage
– Compatibility
– Complexity
– Trialability
– Observability

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 Relative Advantage

 The degree to which the innovation is

perceived to be superior to current
practice.

 Relative Advantage is how improved

an innovation is over the previous
generation

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• Economic profitability.
• Low initial cost.
• Decrease in discomfort.
• Saving in time or effort.
• Social prestige (only for innovators,
early adopters and early majority)

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Some products, such as cellular phones, fax
machines, and ATM cards, have a strong relative
advantage.  Other products, such as automobile
satellite navigation systems, entail some
advantages, but the cost ratio is high.

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 Compatibility

 The degree to which the innovation is

perceived to be consistent with socio-
cultural values, previous ideas, and/or
perceived needs.
 The level of compatibility that an
innovation has to be assimilated into an
individual’s life.

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• Compatibility with values and beliefs.

• With perceived need.

• With previously introduced ideas

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.  For example, birth control is incompatible with
strong religious influences in countries heavily
influenced by Islam or Catholicism, and a
computer database is incompatible with a large,
established card file.

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 Complexity

 The degree to which an innovation is

difficult to use or understand.

 The Complexity of an innovation is a
significant factor in whether it is adopted
by an individual. If the innovation is too
difficult to use an individual will not
likely adopt it.

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• Leads to difficulty in understanding.

• Also results in difficulty in

implementation.

• Thus, it has a negative relationship with

adoption .i.e. more complex-less adoptive.

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The calculator has its history in mechanical
devices such as the abacus, slide rule and
mechanical adding machines. These machines
were, however, very heavy and expensive. This
semi-manual process of calculation was tedious
and error-prone. However modern calculators
are electronically powered and very easy to use
it has now taken a shape of pocket calculator for
everyone
 

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 Trialability

 The degree to which the innovation can be

experienced on a limited basis.

  It determines how easily an innovation

may be experimented with as it is being
adopted. If a user has a hard time using
and trying an innovation this individual
will be less likely to adopt it.
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• Experimentation on limited basis before
final commitment.

• Especially important to early adopters.

• Positively correlated with adoption rate.

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• Hybrid corn was adopted only slowly among
many farmers.  Farmers were reluctant to try it
because a failed harvest could have serious
economic consequences, including a possible
loss of the farm. 
•   Few farmers switched to hybrid corn outright
from year to year.  Instead, many started out
with a fraction of their land, and gradually
switched to 100% hybrid corn when this
innovation had proven itself useful.

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 Observability

 The degree to which  the results of

an innovation are visible to potential adopters.

 The extent that an innovation is visible to

others. An innovation that is more visible will
drive communication among the individual’s
peers and personal networks and will in turn
create more positive or negative reactions.

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• Visible results.

• Positively correlated with adoption rate.

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ATM cards spread relatively quickly. 
Since the cards were used in public, others
who did not yet hold the cards could see
how convenient they were.

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Graphical Representation

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 Review with example:
Example: Cell
Phones
Relative advantage: Time
savings;
portability; emergency use; status
symbol.

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• Compatibility: connects to existing network of
phone users.
• Complexity: easy - works like a regular phone
• Observability: highly observable; public use
emphasized status value to potential users
• Trialability: can easily borrow a friend's to try
out.

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