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I have to confess: I asked for an Amazon (NASDAQ:AMZN) Kindle Fire for Christmas.
I’m not usually tempted by the allure of new electronic devices. That’s largely because I know that the minute they arrive they’re already obsolete. And it’s also because I have a hard time abandoning my existing device since we’ve been through so much together.
However, in this case I don’t have an early-generation Kindle to replace. No tablet will wind up in my desk drawer to mingle with my old iPod, iPhone 3, Flip camera and BlackBerry . . . and whatever lies under them.
This could be uncharted territory for me, if You Know Who delivers.
I’m a proud member of what you’d call the Late Majority – we’re not the first to buy the newest technologies, but we’re also not the last. Don’t ignore us, for our significance extends far beyond simply determining what may or may not wind up under my Christmas tree in two days time.
We can help show you where you should be investing over the coming year.
You see, it’s been shown that over time people fall into certain categories as they relate to technology purchases. Back in 1962, a professor of communications, Everett Rogers, took the time to define these categories.
His book, Diffusion of Innovations, laid out the theoretical groupings as well as the percentage of people contained therein. You can see Rogers’ groupings in the “Innovation Adoption Lifecycle” chart below, courtesy of Wikipedia.
As you can see, the quick-moving Innovators are a small group, equivalent to around 2.5% of the population. These guys buy everything early (and often overpay).
The Innovators are followed by the Early Adopters and the Early Majority, at 13.5% and 34%, respectively. Next in line is my group, the Late Majority, also at 34% of the population. Bringing up the rear are the Laggards.
Based on Rogers’ theory and my wish for a Kindle Fire this Christmas, sales of tablets are going to explode in 2014. That’s because the Late Majority and the Early Majority make up the bulk of the buying population — 68%, to be exact
This collective purchasing power is evident if we add market share to Roger’s innovation life cycle curve, as shown in the chart below (courtesy Wikipedia). As you can see, as the Late Majority starts purchasing, the newest technology’s market share (in this case tablets) begins to surge from ~50% up towards 75% – 100%.
Based on this theory and my wish for a Kindle Fire, I expect that sales of tablets are going to grow exponentially this holiday season and into 2014.
It’s not a super-precise sales forecast, but over time I’ve been amazed at how accurate this time-tested model has been. And I’ve used it to help drive investment ideas, too.
My advice? Think about where you fit on the innovation adoption lifecycle. Maybe that knowledge will help you make profitable investment decisions in the coming year.
In fact, I just recommended that subscribers to 100% Letter buy shares of a small company that helps tablet manufacturers design products for the Late Majority (and all other groups, too).
I’ve included this company in a report our company published last week titled Best Stocks for 2014. Inside this report, you’ll discover 10 investment ideas from our team of advisers here at Wyatt Investment Research. Our marketing team has been authorized to give away this report as a holiday gift for our customers. To get all the details and to claim your copy, just click here now.