Chasm
Chasm
What is the chasm?
- The gap between the early market and the mainstream market
- The cause: two groups with different buying logic
- Break through with niche focus and a whole product
Understanding the chasm changes the order in which you diagnose stalled growth. When revenue turns down, most teams first adjust sales headcount, price lists, or ad budgets. The chasm view instead reads it as a failure to notice that the customer has changed. Early customers bought to get ahead by using it before others; the next customers buy because the factory next door already uses it. That is why response cools even though the product and sales team are unchanged, and what needs adjusting is not sales intensity but the kind of proof you offer. The question shifts from 'how do we persuade better' to 'what do we prove it with,' and this is also where the habit of tracking the number of PoCs and the paid conversion rate separately comes from.
Where you draw the line changes the remedy. The chasm is not the 'valley of death' of the earliest startup stage, when neither technology nor funding is proven. It happens when the product works and paying customers already exist, which also means there is no guarantee that the product-market fit confirmed in the early market holds in the mainstream. In Rogers’ distribution, early adopters are 13.5% and the early majority 34%, so the latter group is more than twice as large. But they are the ones who bear accountability if adoption fails, so they first demand success stories from the same industry and a similar size. If you pass the pilot but stall at company-wide rollout approval, suspect the chasm. And if you knock on several industries at once, recommendations pile up in none of them.
The most common mistake in the field is treating the chasm as a phase you can wait out. Time doesn’t build the bridge; references do, so if you hold on without narrowing to one industry, you only add sales headcount while prices get cut. Teams also often mistake the whole product for added features: taking requests from each client and bolting them on builds up customization debt split by industry, which fragments the development roadmap, exhausts support staff and pushes back the requests of the beachhead customers who matter most. When you pitch it to executives, a niche focus can sound like giving up revenue, and they push back. Narrowing is not a decision to shrink the market; it is a decision about where to build the first bridge. If you can’t show that in numbers, the organization will slide back to selling to every industry within months.
John KimInstructor John Kim, author of B2B Marketing Design and CEO of Nanum Consulting
Euijung KimBrand strategist with 30 years in advertising, formerly a division head at Daehong CommunicationsIt was introduced by Silicon Valley marketing consultant Geoffrey Moore in his 1991 book Crossing the Chasm. Applying the adopter curve from Everett Rogers’ diffusion of innovations theory to high-tech markets, he named the rift between early adopters and the early majority the 'chasm.'
Let’s look at a hypothetical case: Company A, an industrial predictive-maintenance AI solutions firm with 38 employees and KRW 4.2 billion (≈ US$3,142,300) in annual revenue. Over 18 months it ran 22 PoCs, but only 3 moved on to paid contracts, and even 2 of those had stalled on expanding to additional lines. A proposal to 'double the sales team' was before the board.
- When the CEO and the head of sales laid out 18 months of pipeline, they found 22 PoCs scattered across 11 industries. The business development manager said, 'We end up explaining from scratch every time.'
- We narrowed the target to one industry: secondary food-processing plants. When a line stops for an hour the loss is KRW 9 (≈ US$1) million, so the case for adopting was clearest there. The goal: build 3 reference customers within 8 months.
- After hearing maintenance managers at client companies ask 'Does it connect to our PLC?' in every first meeting, the team added connectors for 3 Korean-made PLC models, a clause guaranteeing night-time dispatch within 2 hours, and a security-review document bundle to the contract package.
- Once the first customer’s unplanned downtime fell from 14 hours to 5 hours a month, we condensed it into a one-page calculation showing a 7-month payback, which the purchasing manager could attach straight to the approval request.
- At an industry association tech seminar, instead of a salesperson, a client’s plant manager presented the adoption story directly, and on the day of the presentation alone, 4 companies in the same industry sent inquiries.
- Twelve months later, 9 companies in the same industry had adopted it, the paid conversion rate rose from 14% to 47%, and the average contract review period fell from 7.2 months to 3.5 months. The proposal to add sales headcount was withdrawn.