Entrepreneurship

Course Code: HS 492

 Introduction
• Concepts of innovation in business
Making something new that creates value
Innovation = Invention x commercialization

• IPP (Intellectual Property Protection)

Copyrights
Trademarks
Patents
Trade Secrets
 Introduction (cont…

• Who is an Entrepreneur ?
Entrepreneur is someone who has the
ability and desire to establish, administer
and succeed in a startup venture along
with risk entitled to it, to make profits.
 Introduction (cont…
• Entrepreneur
• Entrepreneurship
• Enterprise
 Entrepreneur vs Businessman
Entrepreneur Businessman

Start a business with a unique idea Start a business with an existing idea

Creates new market Creates place in existing markets

Low competition Very high competition

Taking risks Comparatively avoid to take risks

Market leader Market player

Revolutionary Traditional
 Four types of innovation
I
m
p
a
High c SUSTAINING DISRUPTIVE
t A significant Technology or new
improvement on a
o business model that
product that aims to
n sustain the position in an disrupts the existing
existing market market
t
h
e
INCREMENTAL RADICAL
M Gradual, continuous Technological
a improvement on breakthrough that
r transforms industries,
existing products and
k often creates a new
services market
e
t
Low
High
Technology Newness
Innovation Adoption Lifecycle
• Originated from a study on farmers behaviour,
innovation adoption lifecycle states how an idea (new
product) diffuses/spreads from the earliest adopters
(innovators) to the laggards.
• It is a sociological model that describes the adoption
of innovation according to the demographic and
psychological characteristics of the target audience.
• E M Rogers in his book Diffusion of Innovations,
classified adopters into five categories: Innovators,
Early adopters, Early majority, Late majority and
Laggards.
 Diffusion of Innovation (DOI) Theory, developed by E.M. Rogers in 1962

Cumulative
share of
adopters

Time
 Innovators
• Innovators are your first customers (2.5%). They are the risk-takers who have
big pockets and high status among their social network. These people love the
possibilities of new ideas and new ways of doing things and often adopt the
innovation/new product during its beta stage.
• Their risk tolerance and financial resources allow them to adopt the new
technology that might ultimately fail and let them absorb the losses.
• Innovators are the influencers for both the manufacturers and the other users
following them in the technology adoption lifecycle. They love testing new
products, sharing reviews and feedbacks, and influencing the demand for that
product.
• A business should focus on one-to-one marketing when reaching out to
innovators. Personalized emails, product listing, and meetings are a few
techniques used by marketers to market their new innovation to the
innovators.
 Early Adopters
• Early adopters is the segment (13.5%) that tries/uses/experiences the offering way
before most of the market try their hand on it. These users have the highest degree
of opinion leadership and are the first ones to write reviews on websites, post
comments and share their experiences with others. Besides this, they are usually
financially stable, have a public figure.
• The motivation behind why early adopters try new products can be anything from
the recommendation from innovators, building social status, or just curiosity.
• Although their risk-taking abilities are not as high as innovators they still seem to
leave their mark on the market. They are the first impression on the market. The
future of innovation depends on the early adopters as these users have good
influencing skills.
• Marketing to early adopters isn’t easy. There isn’t any rule of thumb strategy and
the marketers need to get into their shoes to develop an effective marketing funnel.
They need to understand early adopters’ expectations and reward them accordingly.
• Current day early adopters include status seekers, loyal customers who believe in
buying the product during flash sales or during the initial days of the launch.
 Early Majority
• The early majority is the first sizeable segment (34%) of the target market
to adopt the innovation. The people belonging to the early majority are not
the risk-takers but have an above-average social status.
• They only adopt the innovation after being influenced by innovators and
early adopters whom they follow or know personally.
• People belonging to the early majority are not the opinion leaders.
However, a variety of things and emotions motivate them to try innovation.
These include social status, early adopters influence, love for new (but
trustable) experience, etc.
• Marketing to the early majority is fairly easy as compared to early adopters.
The early majority usually believe in facts and stats as they are less
educated than innovators and early adopters. They like to try new things
and be a part of the social herd. They are attracted by the idea of a new
experience that has been validated by the experts.
• Current day early majority include people who follow the influencers on
Youtube and review websites. These are the people who wait for 2 months
for the reviews to come in and try the product.
 Late Majority
• Late majority is the last sizeable segment (34%) of the target
market to adopt the innovation. This segment is made up of
risk-averse adopters who only adopt the innovation when it
is validated and assimilated as a part of daily life by a
majority.
• People belonging to the late majority are very sceptical
about new experiences, have below-average social status,
and almost no opinion leadership.
• The late majority believe early majority more than they
believe in the marketing message. One has to appeal to the
early majority first in order to reach to the late majority.
• Current day early majority include people who wait for the
next version to release before buying the previous version.
 Laggards
• Laggards is the final segment (16%) of the target market to adopt the
innovation. This segment is made up of seniors and those with very low
socio-economic status who doesn’t like change and only accept new things
and experiences when forced to.
• People belonging to this segment don’t accept the innovation until all
traditional alternatives are no longer available. They are concerned with
reliability, low costs, and ease of use. They belong to the very low-income
group, are less educated, have low status and low social mobility.
• By the time they adopt the innovation, it has already become outdated and
been replaced by newer versions.
• Many marketers ignore laggards because of their disinterest in trying the
products but since these people form 16% of the total customer base, they
are a segment which could prove very useful when the product reaches its
maturity
Market share and DOI
 Entrepreneur

• Entrepreneur is someone who has the

ability and desire to establish, administer
and succeed in a startup venture along with
risk entitled to it, to make profits.
• The entrepreneurs are often know as a
source of new ideas or innovators and
bring new ideas in the market by replacing
old with a new invention
 Characteristics of Entrepreneur
• Ability to take risk
• Innovation
• Visionary and leadership quality
• Flexibility
• Knowledge