What characterizes disruptive innovation?

Disruptive innovation is characterized by its ability to challenge existing companies and their business models, prompting them to adapt or change in order to survive. This type of innovation typically introduces a product or service that is initially lower quality or simpler, but it serves a new or underserved market segment. As it improves over time, it starts to attract the majority of customers from established competitors. This process forces the current market leaders to reevaluate their strategies and often leads to significant shifts within the industry.

The other choices focus on aspects that do not align fully with the concept of disruptive innovation. A product enhancing existing products reflects incremental innovation rather than disruption. A technology that doesn't impact the current market lacks the transformative potential that defines disruption. Lastly, a minor improvement on an existing product also falls into the realm of gradual enhancements, distinct from the sweeping changes brought about by disruptive innovations.