When there is a “Performance Oversupply” it creates the opportunity for disruptive technologies to attack from below.  The intersection of Performance Supply and Performance demand is a critical juncture in the product life cycle.

The Product Lifecyle and how they evolve:  Performance Oversupply is one of the main factors that drives how/when a product moves to the next phase of the lifecycle.  The Buying Hierarchy:

  1. Functionality:  At first there is no product to fill a need.  Then a product moves into the space to fill the need.  Eventually a competitor emerges
  2. Reliability:  then there is differentiation on Reliability.   The most reliable vendors of the most reliable products earn a premium.   Though reliable really means that it’s the one that people feel will most likely solve the need.
    1. Known as the “Early Majority” customers
  3. Convenience:  When 2 or more producers are in the market and there is over supply of reliability, consumers will chose based on convenience.   The most convenient to use and vendors most convenient to deal with
  4. Price:   Once there are many vendors and an oversupply of reliability and convenience, then differentiation will be on price.
    1. Known as the “Late Majority” customers

There are 2 consistent characteristics of disruptive technologies that persistently impact product lifecycles and competitive dynamics.

  1. The attributes that make disruptive products worthless in mainstream markets become their selling point in emerging markets.
  2. Disruptive products tend to be simpler, cheaper, more reliable, and convenient.

The firms that were most successful in commercializing a disruptive technology where the ones that framed their primary development challenges as marketing one.  To build or find a market where market competition favored the features and attributes of the disruptive technology.   If the companies keep their product bottled up in the lab until hit can suit mainstream markets are not as successful.   Find markets that embrace disruptive technologies.

For example, Quickbooks recognized that most small business owners don’t actually use the sophisticated and complex reporting in most software programs.  So they focused on making it adequate and simple to use.  Captured 70% of the market within 2 years.

Another example is the company that came out with an automatically dosed insulin pen vs needles and syringes.

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