Over the last few months I have had the pleasure of presenting The 16% Rule, my theory on accelerating diffusion of innovation, at the 2011 ADMA Forum and at The Customer Show, Sydney.

Thanks to everyone who came along to see me present, it is always an honour to speak in front of a full house.

And an extra special thank you for the kind ratings. I’ve been informed that The 16% Rule was rated among the top 5 presentations at ADMA Forum, and was a “crowd favourite” at The Customer Show.

I have now loaded up my presentation slides to SlideShare (below) for your reference. Shout out to Charlie Rose from Two Thorns for the great design job on the graphs.

Please feel free to comment or contact me if you have any questions about The 16% Rule.

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• The Secret to Accelerating Diffusion of Innovation: The 16% Rule Explained | INNOVATE OR DIE (innovateordie.com.au)

iinet is No.2

When I first saw the new iinet campaign where they claim to be the new No.2 in DSL Broadband, I quickly knew I had to write a blog post about how similar this campaign is to the great Avis “we’re no.2 so we try harder” campaign from the 1960s.

Fortunately, my friends over at Marketing Magazine have already covered this angle which frees me up to look a bit deeper into why this strategy will work for iiNet.

What message does “The New No.2″ Send to Consumers?

The iinet case is different to Avis’ because iinet are “the new no.2″ which is demonstrating social proof that iinet has grown big enough that it must be doing something right.

The fact that iinet is No.2 was a big surprise for me, as I am sure it is for a lot of people. When I left Australia in 2009, iinet were a small aggressive challenger, but in the few years since it it turns out they made some big acquisitions (Netscape, AAPT) that really put them on the market share map.

iinet must be doing something right

The new no.2 is a great social proof message as it shocks consumers into wanting to know why.

Why is Now a Good Time for a Social Proof Message for iinet?

With my Diffusion of Innovation theory titled The 16% Rule, I make the case that at around 16% market share brands need to change their messaging strategy from one of scarcity, to one of social proof in order to attract the early mass.

In September 2010, iinet announced that it had reached 15% market share of the fixed broadband market. By now they must be edging towards the magic 16%, so making the switch to social proof messaging is the best communication strategy they can take.

My favourite execution of the campaign is below. It is my favourite because of how the line “It took 18 years for this to happen over night” beautifully demonstrates my 16% rule theory that if you are going to achieve fast diffusion of innovation, the mass market really shouldn’t know about it for some time (Innovators and Early Adopters need to experience it first).

It took 18 years to happen overnight

With this in mind, yesterday I noticed Google had started outdoor advertising in Sydney for its Chrome browser, which has now been available for over 18 months. Personally it has been my favorite browser for a while because it is so damn fast, and the creative reflects this product benefit.

So why has it taken so long for Google to start advertising this exceptional product? Basically, it hasn’t needed to.

Google is infamous for keeping its products in Beta stage for long periods of time, which allows Innovators and Early Adopters to experience the product before it is ready for the mass market. Using this approach,  according to Web analytics firm Statcounter, Google Chrome has now reached 7% browser market share at the expense of Microsoft’s Internet Explorer.

Google Chrome is eating Internet Explorer's lunch

However as you can see from the graph, the growth is starting to slow and this is because Google is nearing “the chasm” or the point in the adoption curve between Early Adopters and the Early Mass, that many innovations fail to cross.

Maloney's 16% Adoption Rule

Note that in my theory I state that this chasm is a 16% adoption. In the graph above Chrome is at 7%, but this is the total market and the reality is that you need broadband for Chrome to work properly and only half of the US population has that, so they are actually very close to 16% market share of the broadband market.

By using above-the-line advertising, Google are wisely changing their media strategy from scarcity to social proof to cross the chasm and appeal to the mass market.

On the other hand Google’s creative while strong, would be even more  effective using the 16% rule if it also adopted a social proof element such as:

“50 million users can’t be wrong”

Even still I think this is a great move for Google and I hope they continue to steal market share from the dated Internet Explorer.

The reality is that even if the customer isn’t happy with the product, they are unlikely to take up the money back offer, as it involves effort on their part to send the product back.

So in effect, offering the guarantee is actually low risk for the marketer.

But does the same theory apply for food products?

In Peru, I came across this Pizzeria advertising that “If you don’t like the food, you don’t pay”.

There is a clear strategy behind this offer.

Firstly, it is written in English in a Spanish-speaking country, so we know they are targeting tourists.

Secondly, the quality of food in Peru is inconsistent to say the least, so the offer attempts to reduce the risk for the customer in choosing a restaurant.

So in the end it is probably a good offer that drives traffic into the restaurant.

The offer itself isn’t a new idea, as there has been a proliferation of successful ‘Pay-what-you-want’ restaurants around the world.

However the wording ‘if you don’t like the food, you don’t have to pay’ seems to come across as a much stronger quality guarantee than ‘pay-what-you-want’.

But what do you think? Would you eat at a restaurant that offered a money back guarantee?

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