1. TODAY’S PRACTICE
The Early Adopter of
Refractive Surgery
Why meeting the needs of today’s patients is critical to building the future market.
BY SHAREEF MAHDAVI
Refractive surgery providers spend a lot The Technology Adoption Cycle is a useful model
of guesswork trying to determine the size because it helps marketers understand the rate at which
of the consumer market for LASIK. refractive surgery is growing in the marketplace. Original
Although this effort is admirable, judg- estimates indicated that all spectacle-wearing adults
ments are often made based on data that could benefit from laser vision correction and suggested
can be misleading, such as current or a potential market size of 150 million Americans. Exper-
past procedural volumes, the population ience during the past 10 years, however, has shown that
in the market area surrounding the practice, a recent the true market for LASIK, accounting for age and refrac-
positive (or negative) national news story, or marketing tive error, is more likely 60 million. This is still a very large
tactics employed by other providers. These local impres- market potential in any consumer category and should
sions are difficult to validate and often don’t reflect what not deter any provider’s interest or enthusiasm.
is going on in markets in other areas of the country.
INNOVATOR S
TECHNOLOGY AD OPTI ON Through 2004, refractive surgery (including LASIK and
A better approach to judging the consumer market for its predecessors PRK, RK, and ALK) has collectively
refractive surgery is to study business models that assist attracted more than 4 million Americans, for a market
marketers in understanding consumers’ adoption of new penetration of approximately 7%. Where does that figure
technologies. One such model is the Technology Adopt- fit in the Technology Adoption Cycle model? The inno-
ion Cycle, also known as the Innovation Diffusion Curve. vators represent the first 1% to 2% of consumers of a new
Originally devised to predict the adoption of new strains innovation, the ones who are the very first on their
of seed potatoes among American farmers, the blocks to own or try the new product. In refractive sur-
Technology Adoption Cycle model has become a text- gery, these were the patients who had RK or ALK, partici-
book standard for marketers who want to predict how
many consumers over time will adopt particular innova-
tions. As Figure 1 shows, this model resembles a bell curve
(All artwork courtesy of SM2 Consulting.)
and divides the consumer population roughly by standard
deviations. Each segment is defined by psychographics (ie,
when consumers tend to buy) on the x-axis and by demo-
graphics (ie, the size of the segment) on the y-axis.
For example, VCRs, which are now present in 90% of
American homes, are near the end of their technological
lifecycle. If you bought a Betamax VCR (Sony Corpor-
ation, Tokyo, Japan) in the 1970s, you were defined as an
innovator. Standards for these machines were still being Figure 1. The Technology Product Adoption Cycle is a bell-
developed, and unfortunately your investment didn’t last shaped curve showing how new products move through dif-
very long. But, if you put off buying a VCR until your ferent segments of the consumer population over time. Out
local grocery store started offering videotape rentals for of 60 million candidates for LASIK, more than 4 million
$0.99, your delay in adoption defined you as part of the Americans have undergone the procedure. This fact puts the
late majority of consumers. market right in the middle of the early-adopter segment.
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2. TODAY’S PRACTICE
pated in laser clinical trials, or went abroad to undergo
laser vision correction prior to its gaining FDA approval.
Innovators are risk takers; they are the consumers most
willing to try something new, even if it isn’t “ready for
primetime.” Although not great in number, these people
are critical to a market because their adoption proves to
the rest of the population that the product does indeed
work. In the eyes (so to speak) of my friends and family, I
was one of those “guinea pigs” who went to Canada 10 years
ago and had PRK. Refractive surgery innovators were
among those most willing to seize the opportunity to get
rid of their glasses. Marketing and customer service did- Figure 2. A product category’s movement from one con-
n’t matter to them as much as availability. sumer segment to the next is neither easy nor guaranteed. It
often requires a change in the product or service to appeal to
E ARLY AD OPTER S the next group of consumers.1
The group that comes after the innovators is called the
early adopters. They also buy early in a product’s lifecycle, technology is embedded in another product. In the
but are not the “technologists.” Rather, they make deci- context of refractive surgery, this might mean that they
sions based on their own intuition and imagination. They will have a procedure once it is fully covered by their
can truly understand the benefits of a new technology insurance plan or comes as part of a package with an
and will buy it if it strongly matches their needs and con- eye examination.
cerns. The early adopters represent the next 15% of the
consumer population. The Technology Adoption Cycle U N D E R S TA N D I N G E A R LY A D O P T E R S
model shows that refractive surgery, at 7% market pene- To understand the long-term market potential of
tration, is currently approaching the midpoint of the refractive surgery, we need to appreciate the impact of
early adopter segment. the early adopter. Using the Technology Adoption Cycle
model can help us clearly understand what has taken
M AINSTRE A M CONSUMER S place in the market in the first 9 years since the FDA
Before exploring the early adopter in greater detail, we approved the excimer laser for refractive ablations.
need to define the mainstream consumer, who makes As early-adopter consumers began jumping aboard
up two-thirds of the market and is divided evenly the refractive surgery bandwagon in the late 1990s, the
between early-majority and late-majority buyers. Both market grew rapidly. Word-of-mouth, especially that
early- and late-majority consumers are driven by a generated by the LASIK procedure, led to high public
strong sense of practicality; they know that many inno- awareness and interest. The merits of LASIK appealed to
vations end up as fading fads, so they will wait until a the early adopters much more than had PRK and earlier
product category is well established before buying. Late- surgical technologies for vision correction.
majority consumers have additional requirements: they Unfortunately, providers of all types of refractive sur-
want the product to come from big, established compa- gery (individual surgeons as well as some corporate
nies that provide high levels of technical support. The interests) mistakenly thought that the rapid procedural
sheer size of the mainstream consumer segment is what growth of the late 1990s was coming from mainstream
makes it so desirable to marketers. Much of the original consumers and that price would be the main driver of
R&D investments of a product have been recouped, so refractive business. Thus, providers lowered their prices
profit margins increase along with volumes in a matur- between 2000 and 2003, because they expected that
ing market. Cell phones are enjoying this stage right market demand would take off. It didn’t. In fact, proce-
now; more than half the population carries one, and dural volumes fell during the same time period. This
advertising is ever-present as a handful of large players effect is the opposite of what happens in mass con-
battle for the mainstream consumers. sumer markets, where lower prices lead to higher con-
sumption. In concert with declining volumes came neg-
L AG G AR D S ative press about LASIK (night-vision problems and per-
Finally come the laggards. They don’t want the new sonal disaster stories). The media made it look like there
technology and are not worth pursuing from a market- was one bad outcome for every good one. The industry
ing standpoint. They adopt a product only when the responded with two major innovations: customized
94 I CATARACT & REFRACTIVE SURGERY TODAY I JANUARY 2005

3. TODAY’S PRACTICE
treatments and the femtosecond laser, both of which thing to try, by the way).
are succeeding in re-establishing interest in the refrac- Refractive surgery was struggling to cross the chasm
tive surgery category. They are indeed perceived as safer between innovators and early adopters until LASIK
and better means to LASIK surgery. Average prices as arrived. Although PRK was certainly an improvement
well as total procedural volumes are again rising. over RK, it suffered from reports of postoperative pain
The price-volume relationship refractive surgery saw and delayed recovery (my own vision took 5 months to
between 2000 and 2004 is further confirmation that we stabilize). LASIK’s appeal was that it produced an imme-
are still among the early adopter segment of the market. diate result. Near-instant visual improvement generated
Early adopter consumers want product quality, which incredible word-of-mouth stories about being able to
translates into providers’ ability to address safety (even see without glasses right after surgery. In this case, a
more than efficacy). modified product (ie, using the laser under a corneal
flap rather than on the surface of the cornea) helped
MORE INSIGHT refractive surgery jump the gap to reach the early
Two well-known authors have recently improved adopters.
upon the Technology Adoption Cycle model with in- The second author with valuable marketing insights
sights that have direct relevance to your efforts to win is Seth Godin, whose books have preached the end of
over today’s early adopter. The first is Geoffrey Moore, traditional mass marketing in favor of relationship mar-
whose Crossing the Chasm1 text helped marketers un- keting that envelops the consumer. In his book The
derstand that there is no smooth transition from one Purple Cow,2 Godin argues that the value of each con-
consumer segment to the next (Figure 2). Instead, sumer segment is not related to its size, but rather to
Moore proposed that the needs of each segment are its ability to influence consumption among the next
different enough from those of the preceding group of segment. Although innovators don’t seem to influence
consumers that many innovations never make it past early adopters, the early adopters have a huge impact
the innovators or early adopters. Apple Computer’s on the mainstream consumer (Figure 3). Thus, reaching
Newton (Apple Computer, Inc., Cupertino, CA) comes this segment for refractive surgery has much higher
to mind; it was an early PDA that never survived be- marketing value than spending money trying to adver-
yond the technologists and hard-core Apple loyalists. tise to the masses.
The marketing of the technology was more refined than These insights lead to two key questions: (1) how do
the technology itself. You can probably list many neat providers attract the early adopter in greater numbers,
products that you came across that just never lasted in and (2) what will it take to jump the gap and reach the
the marketplace or are currently struggling to make it. mainstream consumer? There are four possible answers
The Segway Human Transporter (Segway LLC, Bedford, that I will explore: price, technology, time, and cus-
NH) is another example of a product that is trying to tomer service.
succeed among innovative consumers (and is a fun
PR I C E
Lowering the price of refractive surgery has failed to
attract more consumers. It is far too early in the prod-
uct cycle for low price to effectively stimulate market
growth.
T E C H N O LO G Y
As described previously, combining microkeratomes
with the excimer laser helped refractive surgery cross
the first chasm between the innovators and the early
adopters. Likewise, the advent of refractive IOLs has the
Figure 3. Early-adopter consumers compose the first 9 mil- potential to help refractive surgery make the next leap
lion or so Americans who have or will have refractive surgery. to the early majority of mainstream consumers. Manu-
They are extremely influential in helping the mainstream facturers are certainly moving toward offering refractive
consumers in the middle of the curve to consider undergoing IOLs; even each of the “big three” excimer laser plat-
refractive surgery themselves. Early adopters will serve as the forms (Star S4 [Visx, Inc., Santa Clara, CA], Ladarvision
established reference base of patients for decades to come.2 [Alcon Laboratories, Inc., Fort Worth, TX], and
Technolas [Bausch & Lomb, Rochester, NY]) are or soon
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4. TODAY’S PRACTICE
stimulate consumer demand. This belief is primarily due
to my own observations that the level of customer serv-
ice in the typical refractive practice is only fair-to-poor.
The powerful nature of the day-1 postoperative visit
has not forced providers to worry too much about all
the other aspects that compose the refractive surgery
experience for their patients. In other words, the prod-
uct has been so good up to now that providers haven’t
had to pay much attention to how well they deliver the
product.
Moore tells us that the gap between early adopters
Figure 4. Creating a remarkable clinical experience (which is and the early majority is even larger than the previous
within your control) builds the foundation for procedural chasm between innovators and early adopters, and
growth. Investing here is less expensive than technology Godin declares the early adopter to be the key segment
acquisition and is priceless in its ability to motivate con- among all, based on these consumers’ ability to influ-
sumers to action. ence the much larger population segment that relies on
them as the established reference base. He further
will be under ownership of a larger entity that also pro- claims that broadcast advertising is the wrong medium
duces IOLs. The fact that 78 million baby boomers are with which to try to attract the early adopters. To-
now approaching 60 years of age will create a demand gether, these two authors clearly make the case for
for IOLs that will build the refractive surgery category, changing how you approach refractive surgery market-
because this surgical option excels where LASIK falls ing, from heavy investment in technology to heavy
short in addressing higher refractive errors, hyperopia, investment in an infrastructure that is focused on the
monovision, and presbyopia. customer. Success here means that you will spend less
With IOLs, the refractive surgery market potential ex- time and money advertising to attract customers and
pands significantly and moves closer to those original more energy servicing them.
estimates of 150 million Americans, which include all
corrective-lens wearers. Refractive technology will con- L I K E I ’ V E B E E N SAY I N G …
tinue to achieve better, safer, and more predictable out- Many of the issues covered in my monthly Marketing
comes; such advancement is the lifeblood of the oph- Mishaps column have touched upon this need for im-
thalmic industry. But technology alone won’t allow proved customer service within refractive surgery prac-
refractive surgery to reach the majority of the popula- tices. I view it as the one aspect of a refractive surgeon’s
tion, because consumers still have a great deal of fear brand that is hard to replicate, making it the true differ-
for anything related to vision. From an adoption stand- entiator in the marketplace. More importantly, service is
point, there is still a long way to go before refractive the best vehicle by which to build a sustainable refrac-
surgery reaches the mainstream consumer. tive practice over time (Figure 4).
In summary, the future of refractive surgery is going to
TIME revolve around the customer and his overall experience.
When a patient says, “I want to see 20 years of history Marketing data from within and beyond the refractive
before I have LASIK,” he is invoking a majority-segment surgery category all point to the need to vastly improve
consumer’s practicality. The longer the product has customer service levels from their current state. ■
been around, the more “stable” it appears to be and the
more likely that it will be supported by well-established Shareef Mahdavi draws on 20 years of medical device
companies. With time, it is reasonable to expect more marketing experience to help companies and providers
conservative consumers to buy in, but it is simply become more effective and creative in their marketing and
impossible to predict when or if such a phenomenon sales efforts. Mr. Mahdavi welcomes comments at (925)
will occur. 425-9963 or shareef@sm2consulting.com. Archives of his
monthly column may be found at www.crstoday.com.
C U S TOM E R S E RV I C E
As is the theme of many of my columns devoted to 1. Moore GA. Crossing the Chasm. 3rd ed. New York, NY: HarperCollins Publishers Inc.;
refractive marketing, the customer experience is the Revised edition 2002.
area that stands out as having the greatest potential to 2. Godin S. The Purple Cow. New York, NY: Penguin Group (USA) Inc.; 2003.
96 I CATARACT & REFRACTIVE SURGERY TODAY I JANUARY 2005