In my last post, I riffed about how little people liked change… and referred to you, my loyal readers, as the self-elected early adopters, the radical new, the folks who embrace big new ideas.

You use Firefox, read a hundred blogs with an open-source RSS reader, have a blog, post your bookmarks with delicious, have a flickr account, you’re a digger and you have built a dozen squidoo lenses. After all, they’re all free, they teach you about valuable new ideas and they’re fun.

Except, if my numbers are accurate, that last paragraph probably isn’t true.

Delicious is a sensation, but far less than 1% of the people online (who are already in the cutting edge of the population when it comes to embracing new tech ideas) have posted their bookmarks. Firefox is demonstrably better than the built-in alternative, and they have market share of less than 20%. Too much inertia. “I’ll just use what’s built in…”

AOL users, were, by definition, the cutting edge for years. They were among the first to go online. But then millions got stuck inside AOL’s walled community, not even realizing that AOL ≠ the internet. Inertia became a critical asset for AOL. That satisfied users by giving them what they liked, not by selling them squid soup.

Web 2.0 is off to a rocket-fast start. Little companies growing superfast. But most of the readers of this blog haven’t built a lens or shared their bookmarks or uploaded their photos yet. How come? It’s fast and free and perhaps fun. The answer is pretty obvious—you’ve got other things to do. The cost of deciding to try is too high, because you can always decide later.

All the innovations that pundits like to talk about—from Jetblue to the Prius to Apple—have tiny market share compared to the attention they get or the benefits that people rave about. Because even the cutting edge isn’t in that much of a hurry.

Watch out for the 5% rule
Most new marketing ideas that are any good feel like they might be able to convert 5% of those in the market for what’s being sold.

And of course, only 5% of the population is in the market for what’s being sold.

And only 5% of those in the market are choosing to pay attention.

So it’s really 5% of 5% of 5%. Take 10,000 people. That’s 500, which gets you 25 which gets you one.

1 new customer.

5% isn’t enough. Not if you’re in a hurry!

The punchline
Marketing used to be expensive. Buy a few million dollars worth of ads and you could have a shot at success.

Marketing is now (potentially) much, much cheaper. But that doesn’t mean it’s easy. The challenge now isn’t to raise a whole bunch of money. The challenge is to invent a product or service or idea or meme that’s so compelling that the tiny green portion of the curve, the geeks in whatever market you live in, can’t ignore what you have to offer. That, and once they adopt what you’ve got, they can’t help but spread it.

That’s not easy. No one ever said it was. But that’s the challenge anyone with a business to grow or an idea to spread has to overcome.