Today I want to talk briefly (because whole books have been written on the subject and I can’t claim to give it the going over it deserves in one blog post) about the idea of “crossing the chasm” – and how you can stay on your side of the so-called chasm and still succeed.
Crossing the Chasm: Marketing and Selling High-Tech Products to Mainstream Customers, by Geoffrey A. Moore has become a cult classic since its release in 1991. Its title says it all, really, but the basic premise of the book can be seen more clearly in the graphic below.
The chasm is wrong and why do you no longer need to cross it to succeed as a tech start-up?
It used to be that the skill of companies that make it big is that of waiting out the gap between “early adopters” taking an interest in their product or service and the “early majority” getting on board. This is no longer the case for most start-ups.
Startups – early adopters can be all you need. Why?
- It’s a matter of quality. You get a good and loyal customer base, whose opinion is respected in the community you are targeting.
- It’s a matter of quantity. With consumers becoming far more tech-savvy over the last decade the chasm curve now is simply incorrect. The early adopters area of the curve (before the chasm) is now much larger – with up to 50% of the market are in this area now. We’ve got mass consumer technology to thank for this: Facebook, Twitter, iPhones etc have made normal people into tech savvy people.
- It’s the Internet baby. This one directly affects quantity – simply put, more people have access to high-speed internet and this makes the market bigger.
And with people generally becoming more and more tech savvy the numbers of “early adopters” out there is on the up – and growing fast. This is the market your start-up needs to target and thanks to the internet, it’s becoming easier to reach.
It’s not so much that crossing over into a bigger market could ruin your company, but that it could dilute the impact of your brand. Talking to consumers on the other size of the chasm takes different products and different mindsets – they’re conservative in nature. It can mean leaving your existing market behind.
So don’t be a sell-out.
Here’s a musical analogy: The band The Shins was a huge hit on the indie music circuit in the US. From Albuquerque of all places, they were well known and respected among the right people, but not at all what you would call mainstream. Then a song of theirs appeared on the soundtrack to the film Garden State (and Natalie Portman’s character even said one of their songs would “change your life” in the film itself) and the band’s audience grew.
Now, that wasn’t such a problem, but what was problematic was when one of the band’s songs appeared on an ad for – you guessed it – the iPod. Now, I am a huge fan of The Shins, but I know many who thought they were selling out. (Disclaimer: I maintain the band is awesome)
Remember: the ones that do it successfully are rare and not to be emulated – unless you’re really gutsy, don’t mind alienating your existing customer base or you have such a technical product that the early adopters category is small.
Remember – stick to what you know, what you do well, and what your loyal customers value.
“Choose a niche and dominate it as opposed to trying to dominate the world on the other side of the chasm. 5000 customers at 100 dollars each per month is a pretty good business model still for a small startup!”
(For more on what not to do with your startup, see Mike’s post from a few weeks ago: “How original product ideas can kill your small business”).
I understand this is more about businesses than bloggers, but I read this thinking it was going to help me understand how to develop more of my brand in my nice.
Now it’s either too early (8am) for me to comprehend your post, the text is too light, or you didn’t get to the point because I don’t understand. I didn’t even have the knowledge of a ‘Chasm’ and I just found out about ‘The Tail.’
Please forgive me. I’m new here, and its still early.
But I think I’ve gotten my point across.
Hi Chaudie,
Thanks for the comment. Yes, this post is about marketing and selling technology products.
Let me explain – the “Chasm” is a term coined in the 90′s and it refers to the big gap (chasm) you had to successfully cross if your tech products were to succeed in the mainstream.
The mainstream (where most customers were) was on the right hand side of the chasm and all products started on the left hand side (where there were far fewer customers).
So, you needed to cross the chasm to make your product succeed in the mainstream market.
Marketing to the people on the left of the chasm was different to marketing to the people on mainstream (right) side of the chasm… thus, it was a big difficult and risky challenge to change… thus the term chasm – referring to something big, wide and difficult to cross.
Now, we don’t need to do this, we can market and sell and be a very successful company by talking to people on the left-side only. This is because the left-side has grown to almost 50% in some markets.
Hope that helps Chaudie.
Mike
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well done for calling bs on crossing the chasm. the concept is a post-hoc rationalization of why a product or service grew beyond an initial base as opposed to a real explanation or guidance to how to market a startup.
the sad truth is that technology based products are rarely targeted at all in any meaningful way. understanding your key benefit, developing to it at the expense of new/expanded features, explaining it to existing and potential customers–all very difficult and require discipline few have. that is another reason why smaller sets of loyal customers who consume heavily and dependably are better than larger bases of customers with limited consumption and benefit.
Daniel – Thanks so much for your comments re Crossing the Chasm and for really adding some points that I didn’t communicate well enough…I couldn’t agree more.
Start-ups need to focus on getting the basics right as you suggest, getting the benefits right and solving a problem – in most cases.
This is something the tech start-up and Micro-ISV industries don’t talk about enough and I think it’s important to try and bring this conversation out into the open. Luckily a few people are really starting to get on this and promote it and we can only hope that more founders start applying these principles.
Mike et al,
I would suggest that this issue be looked at in a different way. Instead of making the assumption that more users are “technology enthusiasts” and “visionaries” on the left side of the Chasm, I would suggest that the break-out of the Technology Adoption Life Cycle distribution has been roughly the same over a long period, that is:
- 3% Technology Enthusiasts
- 13% Visionaries
- 34% Pragmatists
- 34% Conservatives
- 16% Skeptics
While I don’t have scientific proof of this break-out, it is generally accepted as the typical distribution of the adoption of disruptive innovations.
So, why not instead look at the level of discontinuity of the technology offer, and where that technology category is in the Technology Adoption Life Cycle when it is launched. For example, Facebook presents little risk to adopt. It initially got its start on college campuses; I would argue that university students were the first “bowling pin” in the pragmatist community for Facebook. So, there were few, if any, “technology enthusiasts or visionary” customers for Facebook because Facebook is not a that much of a disruptive innovation from an adoption standpoint. On the other hand, if there was a “chasm” for Facebook, initially it was not an adoption chasm but rather a “monetization” chasm…how will they make money? That issue is being resolved now, but it wasn’t initially.
Lots of other technology products that are launched today are launched on the right side of the chasm. And there’s nothing wrong with that. It just means that the product is not that “discontinuous” or “disruptive.” So, there may be no chasm to cross. Take, for example, when Apple launched the iPod and iTunes. The Early Market was done for them by the likes of Sony and Creative Labs, who, while creating great technology at the time (MP3 songs on a portable digital player), failed at creating the Whole Product. Apple came in as the category was moving forward in the Technology Adoption Life Cycle and came out with not only the iPod but iTunes. End of game. A complete solution for Pragmatists.
On the other hand, there are lots of technologies that ARE disruptive and will need to find a way to cross the chasm. For example:
- Near field communication
- Many “green” technologies
- Thought-based computing
So, the moral of the story is: what is the CATEGORY, and where is the CATEGORY in the TECHNOLOGY ADOPTION LIFE CYCLE?
BTW, good and interesting comments, and I welcome feedback.
Firstly thanks for your well thought out comments, input and taking the time to bring your voice to the discussion here Mark.
My main point (that the curve still exists but there are more early adopters and visionaries) I think holds water in a number of important ways:
1) We are seeing pervasive technology changes (heck, when I was in University the Internet was still relatively new). Now with social media, iPhones, Txting and other technologies that have become taken-for-granted by the next generation. My 6 year old daughter knows all about Facebook (although she’s not allowed on it) and uses the iPhone better than myself.
This education and mainstreaming of technology in every day life means that the chasm, whilst still existing is pushed further to the right with a larger population on the left than previously.
This only holds true for technology that is mainstream or nearing mainstream understanding.
2) Tech startups are lucky to be able to exploit this by positioning their technology nearer the mainstream or to put it crudely, making it really user friendly… you could call this the Apple-effect or the art of making technology and complex products easily understood, simple and accessible.
I think for what you talk about Mark, the chasm does still exist and is very real, especially for disruptive technologies… in fact, I think we’re communicating similar messages in a number of ways although mine is especially targeted at small tech start-ups where I think taking the approach outlined above is a critical pillar in how easy success comes to them.
It’s hard to talk about Facebook, Twitter etc when they are so different to what most start-ups will be doing. Whilst fitting the mold in some ways they break it in others. I guess if we’re talking about a monetization chasm then that’s another story altogether and not something I had thought about in regard to the chasm.
Thanks for your comments Mark and I’d love to hear any feedback you’ve got – good or bad
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