The unwanted consumer? Beware the harbingers of failure, warn researchers

By Nathan Gray contact

- Last updated on GMT

The unwanted consumer? Beware the harbingers of failure, warn researchers

Related tags: Marketing

Positive product feedback is a good thing, right? Not if it is from a ‘harbinger of failure’ who repeatedly buys niche market and flop products, warn researchers.

While positive customer feedback and repeated sales are generally seen as a positive thing in food retail, researchers writing in the Journal of Marketing Research ​warn that there is a small set of consumers who, time and again, purchase and rave about new products that consistently flop.

According to the team, positive feedback from these customers, whom they name ‘harbingers of failure,’ actually means that a product is likely to bomb.

"Certain customers systematically purchase new products that prove unsuccessful,"​ said the team, led by first author Eric Anderson from Northwestern University, USA.

"Their early adoption of a new product is a strong signal that a product will fail - the more they buy, the less likely the product will succeed.”

The authors suggest that food brands and retailers can identify these customers either through past purchases of new products that failed, or through past purchases of existing products that few other customers purchase.

Harbingers of failure

In their study, Anderson and his colleagues used data from 2003 to 2009 from a large chain of American convenience stores selling beauty and healthcare products, food, and general merchandise.

Using this data they identified ‘harbingers of failure’ customers either through past purchases of products that failed - like Diet Crystal Pepsi or Frito Lay Lemonade - or through past purchases of existing products that few other customers buy.

A product was judged a flop or failure if it was no longer being purchased after three years on the market, said the team.

loser-products

Out of nearly 130,000 customers sampled, Anderson and his team found that around 13% (around 16,500) qualified a potential ‘harbinger of failure’ because 50% or more of the products they purchased flopped.

The analysis showed that the customers who purchased flops in a first round of purchasing were also more likely to purchase flops in a second round - and that this signal was even stronger if the customer had made repeated purchases of the failing item.

Additionally, such ‘harbingers of failure’ could be identified not just by the number of failed products they chose, but by what products they tended to buy in general – with the team noting that these customers tended to purchase niche items that few other customers chose.

"Using both a customer's history of buying flops, and a tendency to buy niche items, a retailer can distinguish harbingers from non-harbingers and make better decisions about whether to continue selling a new product.”​ said the team.

“While the results of this study provide evidence of a class of customers known as 'harbingers of failure,' there is also some evidence of 'harbingers of success’,”​ they added. “Future research is needed to more accurately identify both types of harbingers.”​ 

Source: Journal of Marketing Research
Published online ahead of print, doi: 10.1509/jmr.13.0415
“Harbingers of Failure”
Authors: Eric  Anderson, et al

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