For many, “Crossing the Chasm” is the tech marketing bible. It certainly is for me. I continue to reference it with clients, leverage its constructs, and go back to it for reminders. Yes, it is 30 years old (although there is a 3rd edition published a few years back that adds an angle for digital consumer adoption), but I feel strongly that it still largely holds today. Yes, XaaS has changed initial paths to adoption, but the adoption at an enterprise level still reflects the insights that Geoffrey Moore shared with us.
The issue with a classic, though, is it often gets only partially used. When thinking about the book, everyone latches onto the Chasm (vs. other great ideas like positioning and whole product concepts). I get it, it is the title of the book, and as Geoff says, navigating the chasm is the key to a market reaching its full potential.
But here is where a point is often missed: the chasm model includes psychographic profiles (innovators, early adopters, early majority, late majority, and laggards) to reflect organizations that are most likely to adopt as a market progressed. But the chasm is not the only “gap.”. Between each stage of the market, as the psychographics that are likely to be interested in the product shift, there is a gap and a need to change tactics. Different things appeal to different psychographics. The chasm is the biggest gap, but the others still exist.
I contend that a new chasm-size gap has emerged.
In talking with Geoff about this recently, he alluded to the idea of the gaps between stages as being akin to tectonic plates shifting. And we definitely see that happening at a new point in the curve.
The Drivers of The New Chasm
The driver is the democratization—and pervasiveness—of technology in business. Today, we are seeing more and more people from more and more different functions becoming part of technology buying teams, whereas in the past most decisions were driven by IT departments. With this dispersion has also emerged a crisis of competence and confidence—the new chasm. This is a chasm that emerges at some point in the middle of the early majority stage–before you get to the late majority. It is before the peak because we see the issues in more then 50% of organizations.
While it is hard to imagine people not understanding quite a bit more than the basics of technology, many don’t seem to understand the nuances and non-functional requirements that are important to addressing enterprise deployments. Businesspeople just want their problems solved, and the SaaS revolution gave them a way to solve them without going through a cumbersome procurement process. But, as use expanded, all of a sudden, all those other issues surfaced regarding compatibility, integration, security, and more. The result: frustrations and confidence erosion for those that encounter these “surprises.” What initially seemed easy, became very hard. As technology buying teams grow, the likelihood of having people less skilled in enterprise decisions grows. Its not just about how they feel about technology; its about how they approach technology decisions.
When factoring in these dynamics, the traditional psychographics groups defined in Crossing the Chasm don’t fit quite as neatly.
Psychographics to Understand to Navigate the New Chasm
Enter Gartner’s Enterprise Technology Adoption (ETAs) Profiles (and our simplified “marketing clusters” grouping). When we developed ETAs, we were trying to find a way to better predict timing of decisions. We’d see some companies adopt one technology very early in the market lifecycle (i.e. like an Early Adopter), but the same companies adopt other technologies later (i.e. like a Late Majority Buyer). Our model leverages many of the attributes of the original groups, but adds additional nuance that reveals a bit more about how organizations buy (not just when and why).
Using the ETA Marketing Clusters, we have three groups that roughly map to the adoption model easily (and a fourth that doesn’t):
- Catalysts – Catalysts are the cleanest fit with the traditional model. They are innovators and early adopters. They like to be first and they view technology very strategically. They’ve built a solid foundation that they can leverage, but are willing to take risks. If they pan out, great. If not, the move on, capturing what they learned and improving vs. dwelling on mistakes. They are clear, aggressive decision makers.
- Strict Planners – Strict planners are disciplined technology buyers. They have a strategic technology plan that guides their decision making. They have very effective decision processes and are confident in their plan and approach. There are two groups within this cluster. The first moves faster. They are the classic fast followers. They let others take the initial risks, but move quickly to catchup and potentially surpass due to their disciplined approach. They fall into the Early Adopter and Early Majority groups. The second moves a bit slower with more caution. Risk avoidance is important to them, but they don’t wait too long be fore investing in technology that has proven value. (As a note, focusing on this group could ease the path across the traditional chasm. The two groups approach buying in similar ways, so there is more opportunity to leverage what worked with the fast followers as you move to the mainstream.)
- Cooperatives – Cooperatives are the challenging group. They make up the biggest portion of the market, but they often struggle with decision making. They get the most people involved in decisions, but often are not clear on decision rights–no one wants to own the decision. They regret most of their purchases. They are plagued by confidence issues. There are two groups in this cluster. Once could be defined as consistently cautious. When forced to change, or even consider change, they do it begrudgingly, without putting in the effort to make it work. The other group is conflicted. They want short-term wins, but they want them without having to change. They view technology tactically, but feel they need to customize everything.
Based on the descriptions, the new chasm becomes obvious. You move from organizations that value technology and put in the work to succeed to those that are cautious and conflicted, lacking the confidence in technology and themselves while at the same time having more people involved in decision making. And, like the original chasm, they require very different tactics from vendors.
Getting across this chasm requires spending more time in helping these organizations build confidence in their own buying process and in themselves. It requires evidence-based coaching on what it takes to get value. It requires realistic expectation setting and goals that can be taken in smaller steps. Some of these steps are similar in the path to win the late majority, but some are different, and as mentioned, are needed earlier in the lifecycle. This new chasm is perplexing as it hits even as a market feels like it is on that growth path. Many organizations who fit the “early majority” model for timing, do so with flawed purchase practices.
The New Business-Driven Buyers Add Complexity
As I mentioned, there is a fourth group in our ETA Marketing Clusters, what we call the Business-Leds. This are many of the organizations that were the successful targets for as-a-service vendors whose story was build around “avoiding IT.” They embody the new approach where business drives the decision making and largely expects IT to support it. We have two groups in this cluster. They approach buying in the same way, so you can use similar tactics, but there are some big differences regarding timing and attitude.
One group is opportunistic. They may move as fast as the Catalysts, but often with less decision rigor. Some of their investments will be wildly successful, but overall they have more failures that brings skepticism and frustration. In some ways, they can be on both sides of the new chasm. They’ll start confident and may be early in the market lifecycle, but could get stuck and languish due to frustrations. For land and expand strategies, this group may be the most frustrating.
The other group are most similar to laggards in the earlier model. Like Cooperatives, they lack confidence and effective buying processes, but they are more apathetic about it. They’ll invest only when they have to and if they get value, that’s fine, and if they don’t, it doesn’t seem to be a big deal to them.
The Signs That Your Are Nearing The New Chasm
The signs for the new chasm’s arrival are jarring. The new chasm hits right after you’ve had some excitement in what Geoff calls being “in the tornado.” Demand is high, growth is accelerating, all is well. The focus is keeping up with demand.
Then, things will start to change, quite rapidly. The easy wins go away. The opportunities remain, but they drag on and on, delayed and deferred for other priorities. The attitudes shift from “let’s win together” to “do we really have to deal with you?”
As-a-Service models add chasm complexity. You might have a land-and-expand strategy that seems to be working. You are winning workgroups and departments. Before the chasm, that growth path is clear. If you can help the customer capture value, they are likely to expand, as long as they see more opportunities for value. But then it changes. You win a department, but the expansion opportunities never seem to materialize. Or, when they do, they too drag on and on. The issue is not about potential value. It is about fear of change. Recognizing those signals is critical to progress.
Preparing for the New Chasm
When Geoff published Crossing the Chasm originally, it was a light bulb moment for many tech leaders and marketers. It helped make sense of situations that many tech organizations were facing at the time (and continue to face). The story of the new chasm is just emerging–there is more work to be done and more to learn. But the evidence for it continues to mount. It is helping us make sense of all the data and insights we have been developing over the past several years on enterprise technology buying behavior. We’d be happy to share those insights with you.
At the same time, I’m convinced it will only get more pronounced as the democratization of technology accelerates.
These ideas and concepts will continue to shape our research into technology buying behavior and the implications that has for product leaders, managers, and marketers. Working with our clients, we’ll be helping adapt strategies, adjust decisions, and refine execution to cross the new chasm and capture the full opportunity of a market, with less frustration.
The challenge awaits. Let’s get to work on approaches to deal with the new chasm.