Beware of early adopters!



beware of early adopters - the mobile spoon


I’ve been thinking a lot about early adopters lately and how they can lead a product in the wrong direction.
Early adopters are the first to give your product a chance. They are the first users to download your app when it's half-baked, the first developers to embed your SDK when it's not yet scalable, or the first tech-savvies to invest their money on a new blockchain project.

A product cannot exist without early adopters, and yet, it’s crucial to understand that this group of users is different than the majority of users, and usually behaves differently, and in extreme cases might lead the product to some problematic directions in the quest for a product/market fit.

Here's the good, the bad, and the ugly sides of your product's early adopters:

Meet your early adopters:

Based on Everett Rogers book: Diffusion of Innovations, early adopters are representing the first 5%-15% of your customers:

early adopters - diffusion of innovations model

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. 
Those are the 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 technologies 
  • They feel comfortable using early-stage (half-baked) products


Jim Carrey's incredible entrance on a Bird scooter - the fastest company to reach a unicorn valuation


Let me share with you some of the differences between early adopters and the majority of users.

Understanding those differences can help you better understand their initial feedback, and will help you filter out some of the noise it creates.


Behavior


Early adopters are less sensitive to product limitations and bugs 

Because they often use products in their early stage, early adopters are more tolerant of product limitations and hiccups.

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.

Similarly, early crypto adopters had to deal with a lot of technical obstacles and high fees before they could actually hold some bitcoins, but they were willing to do so because they understood the potential and where the technology is going. 




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 tech savvies and less sensitive to price

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. 

This behavioral difference might break some assumptions made in the business model.

Early adopters are often biased

Some of them might come from inner/outer circles of friends, maybe even supporters of the company, and that leads to over-excited feedback, which leads to confirmation bias. (bias 34 in my all-in-one guide to cognitive biases).

Others are either entrepreneurs, tech-savvies, or power-users that may not represent the majority of customers: they often seek knowledge and experience at the cost of ease of use. 

In extreme cases (and I've witnessed that more than once), they might even ask for more advanced features that add unneeded complexity to the product instead of simplifying it. This results in bad product decisions based on biased initial feedback.


KPIs 


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 pitfalls of the funnel

As a result, those bigger drops will only appear when the volumes increase. 


Early adopters show higher retention rates 

There are many factors that drive retention rates: 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. 

As a result, you may find yourself building your unit economics based on retention rates that are just too high, and when looking at long-term numbers, even the smallest deviation in retention rates makes a significant impact on the bottom line. 




Here’s an early-stage (probably clunky) product I’m willing to pay for!


So as you can see from the above list, working with early adopters is not always that easy, and can result in some biased feedback being translated into some wrong product decisions. Below are some ways to deal with it. 


Working with early adopters

Here are some points that might help during the early adoption stage: 
  1. Understand the differences between early adopters and the majority of the users 
  2. Identify and mark the early adopters' cohorts in order to later separate them from the rest of the cohorts (user segmentation is key. here's a short guide about how to prepare your data for user segmentation). 
  3. Treat the early adopters as an asset, embrace their feedback, but take it with a grain of salt
  4. Remember they are more engaged and excited to share their feedback but they represent a very small group compared to the mass market 
  5. Measure measure measure - numbers represent behavior and that’s much stronger than words 
  6. When measuring - distinguish between early cohorts with later cohorts
  7. Later cohorts are the ones you should focus on, to validate the business model with, build the unit economics, retention, LTV, etc. 
  8. Always be doubtful about your product/market fit even if the business grows nicely and the early adopters are providing positive feedback - most of the problems come on a later stage when the majority of users are in... 
  9. Validate your assumptions with non-early adopters: what might be enough for early adopters, will probably not be enough for the mass market


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Comments

Gil Bouhnick The Mobile Spoon
Amit said…
I wonder how long does it take to finish the "early adoption" phase...
Gil Bouhnick The Mobile Spoon
igorlir said…
I suspected some of this is happening to us as well:
High retention for first few months, different survey results...
Gil Bouhnick The Mobile Spoon
Anonymous said…
Useful article
Gil Bouhnick The Mobile Spoon
nmtool said…
Always be doubtful about your product/market fit even if the business grows nicely and the early adopters are providing positive feedback
Gil Bouhnick The Mobile Spoon
gig8 said…
Scary stuff.
So basically all new products should expect an incline after a while?
Gil Bouhnick The Mobile Spoon
Anonymous said…
Early adopters will provide the first review/feedback about the product and help it sailing against its competitors into the star-maturity stage through sheer word of mouth and endorsement. When the product reach the star-maturity stage then you need to innovate to reach and embrace the early majorities so that the product can reach the cash-cow-maturity stage