Innovators and customers view “benefits” and “costs” from very different perspectives. Missing this difference is a recipe for disaster.
Innovators think about benefits in terms of what their product actually provides—the absolute benefit delivered to the customer. But customers think about benefits in terms of added value—the relative benefit delivered by the product compared to the available alternatives.
Each group also has a different understanding of costs: while innovators tend to think of the price they will charge for their innovation as the determinant of customer cost, customers conceive of cost in terms of that price plus all the other changes they need to undertake in order to use the innovation (beyond the initial outlay, the cost of retraining, equipment upgrades, etc.).
While innovators tend to focus on delivering an offer whose absolute benefits exceed the purchase price, adoption happens only if the customer sees a clear surplus: that is, the relative benefits must exceed the total cost. Remember that people are allergic to change !
These differences can lead to an assessment gap. And this gap can lead to disappointment.
Notes from The Wide Lens by Ron Adner