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Summary:

When it comes to consumer technologies, how big is big enough? When do they really start to gain momentum, and what happens when they do? These are questions of critical mass — the tipping point when user adoption starts producing the hockey-stick growth that fosters sustainable businesses.

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When it comes to consumer technologies, how big is big enough? When do they really start to catch on and gain momentum? What happens when they do? These are questions of critical mass — the magical tipping point when user adoption starts producing that old cliche hockey-stick growth that fosters sustainable businesses. And as I discuss over at GigaOM Pro (subscription required), it’s worth considering just what defines critical mass in consumer tech.

The twin engines of critical mass

Historically, critical mass tends to occur when about 15 percent of households or users adopt a new consumer medium or technology. At that point, two things happen: Adoption accelerates and new businesses or markets emerge.

In the early 1980s, when 15 to 20 percent of U.S. households owned a VCR, a whole new business around home video rental was created. Blockbuster was born. Adoption accelerated and rental revenues flowed.

Social media nears the tipping point

Social network usage showed a similar pattern. In 2005, social and professional networks like Friendster, MySpace and LinkedIn were used by fewer than 15 percent of the online population. Two years later, MySpace was generating more page views than Yahoo and cutting billion-dollar ad deals with Google. Today, other social media technologies that are reaching critical mass include:

  • Social gaming. Using Facebook as a launchpad, social games like Zynga’s FarmVille and Mafia Wars have have reached 20 percent penetration in the U.S. Unsurprisingly, they’ve become advertising and promotional vehicles for brand-name marketers like McDonald’s and may finally prove the value of micro-transactions and virtual currency.
  • Micro-blogging. We’re really talking about Twitter here. With 24 percent of U.S. adults using status-updating services, adoption is near or at critical mass. Twitter is still figuring out monetization, but micro-blogging has driven feed-based user interfaces and news dissemination.
  • Social commerce. Groupon told me they have 15 million subscribers in North America. That’s pretty close to 10 percent of the U.S. adult population using just this one service. aspect of social commerce is close to critical mass; cheap, effective customer acquisition by local couponing is about to arrive.

Read the full post here.

Image source: flickr user mararie

Related content from GigaOM Pro (sub req’d):

  1. Wait until people see Hashable!

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  2. Interesting premise, but I’m not so sure we will see the mass adoption seen with the VCR at this “tipping point”. This is primarily due to the fact that these technologies (especially LBS are not nearly as readily understood (use AND benefits) as the VCR (OK, nevermind the fact that my parents were not much older than I am when the VCR came out and never were able to get the clock to stop flashing “12:00″.)

    The other limiting factor is (in at least one and a half of the above cases), that ownership of and reasonable familiarity with mid-level to advanced mobile technology is a requirement. It’s an interesting comparison, but there are barriers to adoption in the form of technology and understanding of the benefits of these services which I think limit the potential for this explosion just yet.

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  3. Derek – I’m not sold on LBS (at least as currently defined by gamelike check-in services) reaching mass-market adoption either. And “pushed” offers might be a little scary for a lot of consumers.

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  4. It’s critical that companies participate in Social Media in order to achieve business success. But its a sort of strange concept that Companies must become publishers of information to be discovered.

    The concept has some drawbacks:

    http://www.customsoftwarebypreston.com/seo-rankings-blogging

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