Session 12

New Product Adoption

Evaluation
 CLASS PARTICIPATION
10%
 MID TERM
20%
 PROJECT (Group)
20%
 Case Presentations
10%
 Surprise Quiz
10%

 END TERM
30%
Evaluation

 MID TERM

20%
 PROJECT (Group)

20%
 Workshops
30%

 END TERM
30%
Cree
 Makers of LED
 $ 1 billion in b2b … first time in b2c
 Coming up with a product which is far expensive and
energy efficient
 Working on creating its space in market
 What are the factors that drive diffusion
 We will use Everett Rogers’ Five Factors to analyse this
case
Five Factors in Diffusion of New
Products
 RELATIVE ADVANTAGE
 COMPATABILITY
 COMPLEXITY
 TRIALABILITY
 OBSERVABILITY
Rogers’
 Relative Advantage
 New product better than the one it looks to replace
 Necessary but not a sufficient condition
 Complexity
 Non decipherable technology
 Non visible benefits
 Trialability
 Low cost
 Low hassle
Rogers’
 Compatibility
 In line with usage
 Psychology

 Observability
 Clearly visible or
 Geek factor
Roger’s
 If a product is relatively better than the one it looks to
replace
 If it is compatible with the systems and beliefs that
currently exist
 If it is low in complexity in use and concept
 If its advantages are easily observed
 If it is easy and inexpensive to try the product

 THEN IT IS MORE LIKELY TO SUCCEED IN THE

MARKET
Questions
 How would you rate the product on first factor –
RELATIVE ADVANTAGE ? 1&3
 How would you rate the product on COMPATABILITY
AND COMPLEXITY? 2&4
 How would you rate the product on OBSERVABILITY
AND TRIALABILITY? 5&7
 Which of Roger’s factors are most relevant for the
consumer adoption of Cree’s LED light bulbs?6&8
 What, in your view, is the quantitative and qualitative
appeal of Cree’s LED? 9&10