Love Your Losers
Every night in America, a marketer wakes up in cold sweats, from a nightmare that their product has been adopted by losers.
Losers buy, but their adoption of a product usually signals that the rest of the population will unfortunately not adopt it.
Crystal Pepsi, one of the failed products adopted by Harbingers of Failure
This fear has recently been theorized in the recent New York Times article about the Harbingers of Failure.
Harbingers of Failure (the academic name for Losers) are a group of early-adopting customers whose purchasing habits have a high correlation with failed products. They have, in the world of product launches, the opposite of the Midas Touch.
One should not avoid Harbingers but embrace them.
Who are the Harbingers of Failure?
They are heterogeneous in their socioeconomic attributes but they do tend to group by zip codes.
Here are some of their characteristics
They buy new products quicker than other customers
They purchase more items than others
They make fewer visits
Essentially, HoF are preference minorities: customers with unusual preferences.
Brands should capitalize on its Harbingers.
They represent pockets of unique unsatisfied customers who are more willing than others to try your products and adopt them.
The implication is that you should know who your first buyer is. To achieve this, presence and follow-up both in online channels and IRL channels is crucial.
If you are launching a new product, have your customer experience team do follow-up calls for every single new purchase. Understand who your innovator is and who your early adopter is. Build personae based on the conversations you have with your new customers.
The Adoption Lifecycle of a Product
For most new products, this chasm is the realization of failure, meaning that the product has not reached critical mass, adoption has failed and that its production should be ceased.
The future of Product no longer lies in economies of scale but in niche premium markets.
In their seminal 2011 paper, Choi and Bell highlight that one of the greatest traits of preference minorities is that they are less price sensitive.
If they want a product, they buy it. No matter how new or expensive.
What we get from the literature is that if Harbingers adopt a new product, it may signal that other customers will not be attracted to the product.
This is not a curse but a blessing.
You have to build your flock of harbingers and give them what they want, at a premium. Create affinity communities around your niche offering to further the sentiment of belonging and uniqueness.
Innovators will move on to the next best thing.
The majority is extremely price-sensitive, especially for FMCG, and are easily swayed to cheaper products once they are introduced to the market.
Your early adopters are your most loyal customers.
Cherish them, no matter how uncool they are.
Betamax, another failed product