The Good, the Bad and the Ugly Truth about Early Adopters
I’ve been thinking about early adopters lately and how they can lead a product to the wrong directions. Here’s a recap:
The Good:
Early adopters are the first to give your product a chance. They are the first users to download your mobile app, the first developers to embed your SDK or the first enterprise company to implement your B2B product.
They provide feedback, they are vocal, they are active in social networks, they are thought leaders, they are tech savvies, they are superheroes!
What can possibly go wrong?
Based on Everett Rogers book: Diffusion of Innovations, early adopters are the first 5%-15% of your customers:
The early adopters belong to 2 small groups:
1. The innovators (2.5%) — tech enthusiasts who look for innovation.
They are excited about finding new ways of doing things and willing to take some risks and try out new technologies.
2. The early adopters (13.5%) — influential and thought leaders.
The early adopters are visionaries. They are often very active on social media and leave their mark on the market.
I call both of those groups “early adopters” because they have a lot in common:
- They have a high social status
- They feel comfortable spending money on new technology
- They feel comfortable using early-stage products
The Bad:
A product cannot exist without early adopters, and yet, it’s crucial to understand that this group of users is different than the majority and may behave differently, provide biased feedback and in extreme cases, even lead the product to some wrong decisions in the quest for a product/market fit.
Here’s why I think relying too much on early adopters might put the product in risk:
Early adopters are less sensitive to product limitations and bugs
Early Pebble (RIP) customers were willing to compromise on functionality and design aesthetics in order to be the first to own a smartwatch. I did the same thing with the Microsoft Band, knowing that I’m getting an experimental (and very limited) wearable, but I was anxious to explore it.
A limited MVP might be enough for the early adopters but the mass market usually has higher expectations.
Early adopters are less sensitive to the price
Buying the latest and greatest is an expensive hobby. I recently started using the Superhuman email client and I’m willing to pay good money for a product that has at least 30 free alternatives just because I felt I needed to explore it.
Early adopters, whether they belong to the “innovators” group or the classic “early adopters” group, are willing to pay that extra cost in order to maintain their leadership position and keep exploring new opportunities and trends. As a result, they may accept prices that other customers will not.
Early adopters are biased
Some of them might come from inner/outer circles of friends, either entrepreneurs, tech savvies and power-users, maybe even supporters of your company, and that leads to over-excited feedback, which leads to confirmation bias. (and speaking of which, if you never heard of the mom test — check this one out).
The Ugly:
You need the early adopters in order to kick start the product. Often enough, the directions taken for the product will be based on their behavior and feedback.
This is where it gets risky:
Early adopters show higher conversion rates
Early staged products have issues: limitations, bugs, unpolished onboarding, but early adopters are often used to it. They know their way around and are able to bypass occasional hiccups across the funnel. The result is an over positive conversion rate that doesn’t necessarily represent the majority of users and often fails to expose the weak spots of the funnel.
Early adopters show higher retention rates
There are many factors that influence retention: product quality, price, user experience, customer service, frequency of use. Early adopters are less sensitive to price and technical hiccups, and in addition, they get some “extra” value by fulfilling their desire to innovate, explore new technologies and lead new trends.
The above may lead to higher retention rates which will not be sustainable when later-stage customers join.
You may find yourself calculating your unit economics based on retention rates that are just too high, and when looking at long term numbers, even the smallest deviation makes a significant impact.
Early adopters give different feedback than others
Price-wise, functionality-wise, early adopters are power users — and you can’t trust a power user to represent the mass.
It’s important to remember this nuance because as you grow your customer base, you may find that the majority of your customers feel differently about the price of your product or some functionality assumptions. It may change or even break some assumptions made in the business model.
Working with early adopters
Here are some points that might help during the early adoption stage:
- Understand the differences between early adopters and the majority of the users
- Identify and mark the early adopters cohorts in order to later separate them from the rest of the cohorts
- Treat the early adopters as an asset, embrace their feedback, but take it with a grain of salt
- Remember they are more engaged and excited to share their feedback but they represent a very small group compared to the mass market
- Measure measure measure — numbers represent behavior and that’s much stronger than words
- When measuring — distinguish between early cohorts with later cohorts
- Later cohorts are the ones you should focus on, to validate the business model, unit economics, retention, LTV, etc.
- Always be doubtful about your product/market fit even if the business grows nicely and the early adopters are providing positive feedback
- Validate your assumptions with non-early adopters: what might be enough for early adopters, will probably not be enough for the mass market
Originally published at www.mobilespoon.net.
