Technology products, particularly in the realm of computers, computer software and electronics are constantly changing, consistently improving and arguably becoming essential components in the everyday lives of potential customers who may or may not have the means to acquire them. Companies that manufacture and distribute these products are constantly pushing the innovative envelope when it comes to providing “new and improved” versions of existing technologies or avant-garde products that turn the consumer electronics market upside down. But when, if ever, do these innovations surpass the needs and desires of those who consume these products?
Clayton M. Christensen (pp 4-12) , in his book Seeing What’s Next: Using the Theories of Innovation to Predict Industry Change, theorizes that there are three distinct groups of consumers that companies identify when determining which innovations to introduce to the market. These groups are:
- Nonconsumers – people who typically don’t buy because they either don’t have the skills necessary to use a particular technology or can’t afford to.
- Undershot consumers – people for whom the existing products or technologies are not good enough.
- Overshot consumers – people for whom the existing products or technologies are more than good enough.
It’s an interesting theory, but does it really answer the question as to whether companies will curtail their innovation practices in order to meet the specific needs of a particular group or is it just overcomplicating the age-old business model of supply and demand? In other words; if nonconsumers and undershot consumers outnumber overshot consumers (or vice-versa) won’t companies just plan to release their new products based on the number of customers likely to buy? And won’t the numbers of these classifications change as circumstances for each individual do? It got me to thinking; which classification would I fit into?
Adobe releases new versions of its Creative Suite packages every year or so with new features, each time, to programs such as Photoshop and Illustrator. As a graphic designer I try to keep up with the upgrades, but it isn’t always possible or necessary to buy the newest version right away. Many of my clients are small businesses that will be just as well served if I produce their materials using CS3 as they would if I used CS5. So, in that case I guess I would be considered an overshot consumer. But sometimes I contract out to larger firms who have creative teams in place with whom I must coordinate. They have the means to upgrade to the latest and greatest version of Adobe’s software, whether they need it or not. That means I have to upgrade in order to open and work on the files they send me. Now I’ve gone from being overshot to undershot (I need a shot) in the time it took for me to receive the email requesting my services.
Of course, it’s extremely important for companies to identify and know the needs of their customers. It’s also important to understand the different classifications of customers to identify markets that aren’t currently being satisfied and to find opportunities to fill those voids. Christensen (p 14) explains that specialists can enter the market and offer “displacement” products that offer less functionality at a lower price for overshot consumers. Adobe does this by offering products such as Photoshop Elements, a less comprehensive version of the software aimed toward amateurs who don’t need the full functionality of the professional software and don’t want to pay for it. In addition, competitors see the overshot consumer market as an opportunity to grab a slice of the pie away from Adobe by offering comparable products at lower prices. Macromedia (which was eventually bought by Adobe) gained many customers with the release of Fireworks. It differentiated itself from Photoshop in that it was specifically designed to make web graphics easier and was much cheaper to buy. Corel, Apple, and Microsoft also have low-end disruptive products that compete with Adobe for a share of the market.
As I straddle the line of overshot or undershot consumer, and my eyes become bloodshot from the sleepless nights sure to be caused by this identity crisis, companies striving to gain market share through various forms of innovation will be doing so only on the premis that there is a demand for such products and a high possibility for profit by producing them.