What should your First Customer look like?

Starting a new business is hard!

And the hardest part of starting a new business is acquiring your first 100 customers. You don’t have to hordes of customer data to breakdown, you don’t have large market research teams to analyze customer behavior, you don’t have existing segments. Sometimes, you don’t even know who specifically will buy your product.

Most entrepreneurs reflexively turn to paid advertising when trying to get their first customers and try to acquire customer segments that are cheapest and hope for the best. This is a grave mistake almost every young entrepreneur has at least chanced upon once. But the reality that every veteran business man will tell you is that while starting a new business, especially one that is innovative and new, some customers are more valuable than the others — The Early adopters.

The Early Adopters — a term popularized by Everett Rogers over 50 years ago in his book, Diffusion of Innovations — an early customer of a given company, product, or technology; in politics, fashion, art, and other fields. But in today’s day and age where marketing channels are constantly getting outdated, consumers are bombarded with various brand messages and marketing dollars don’t provide the value it once did, understanding and leveraging early adopters takes a whole new level of significance for young companies starting out and building a brand.

Consider the following scenario:

You have just launched a new restaurant in the heart of the town serving the best and delicious Italian food. You have a 5$ marketing budget and you can use it to acquire one of the following customers:

  1. Jane — a young college student with over 5000 followers on Instagram and takes photos of every food she eats and every friend she meets.
  2. Jack — A mid-30’s marketing manager who reads obscure cooking blogs, has written over 100+ Zomato and Yelp reviews for his 800 followers and spends his weekends experimenting new recipes
  3. Jordan — A 50-year successful software entrepreneur with a net wealth of over $3M and has been visiting the same barber for the last 25 years

This can be an extremely tricky proposition for a young business. Although the young college starlet might give you a good reach on Instagram and the wealthy businessman would provide you a lifetime of sales higher than Jane and Jack, a smart restauranteur would try to win over the loyalty of the food blogger in the restaurant’s early days. And the reason is simple — Marketing budget spent to acquire your first customers not only contribute to their sales but also the sales brought in through word of mouth spread from delighted early customers. Jack might visit your store only once or twice in his lifetime but the good reviews left by Jack on Zomato and Yelp will live forever and bring in far more customers further down the line.

“Marketing budget spent to acquire your first customers not only contribute to their sales but also the sales brought in through word of mouth spread from delighted early customers. “

In his book Everett Rogers introduces us to the technology adoption lifecycle where he argues that a new idea is adopted by certain categories of society and then slowly diffuses to the rest across various communication channels — And he also identifies two categories of people who are first to try out a new idea — The innovators and early adopters.

It’s a tough job finding great innovators and early adopters to help you shape your product. Tough, but unavoidable. Can you leap-frog the innovators and early adopters directly to attract the early majority or late majority directly? The answer in almost all cases is — NO!

Before we jump to the difficult proposition of attempting to acquire early adopters (for all practical purposes we will be referring to the group of innovators and early adopters as early adopters everywhere in this post) it is important to understand one fundamental question — What drives these early adopters? Why do they do the things that they do?

  1. Early adopters have a strong desire for novelty: Early adopters stay up to date with the latest trends, almost to the point of being obsessive. They like being the first to try or buy a product, and they are often willing to pay extra to do so. They’re the first in line and are often prepared travel across state boundaries to get their hands on something new and potentially life-changing.
  2. Early adopters are self-confident: When it comes to purchasing products, early adopters are self-confident and self-sufficient. They purchase a product because they want to, and not because someone else advised them to do so.
  3. Early adopters are opinion leaders and status seeking: They will introduce family and friends to new products and ideas they have discovered, because they have an innate need to be respected and admired by those close to them.

Now that we know a little bit about early adopters it is important to understand why a marketer needs to target heavily on finding and catering to the needs of early adopters

  1. To generate buzz for your product: Early adopters are usually very outspoken and talk to the people around them about the products they like — and don’t like. They also spend a lot of time penning reviews on various social media websites and blogs. A good response from them will help drive word of mouth for your product a long way.
  2. A source of early feedback: Early adopters are the most likely customers to give feedback, good or bad, which can be invaluable to bettering your offering so as to appeal to larger audiences
  3. Low cost of acquisition for young companies: Due to their desire for novelty, early adopters are more open to trying out a new idea or a new restaurant and as a result cost per acquisition for this particular category of customer is quite low despite your product not possessing brand recognition. They are also more forgiving of your mistakes as they have experienced products from several new and unknown companies and understand that companies are prone to mistakes whenever they try something new

Early adopters have become all the more important today owing to the rise and spread of social media. Social media has given these early adopters an unequivocal platform to influence the thoughts of others and satisfy their cravings for seeking social status. Companies like Apple and Google continuously tap into the psyche of the early adopters to promote new ideas and innovations.

Apple owes its historic growth in large part to early adopters, who famously show remarkable rates of adoption. Most recently, 14% of users upgraded to the latest iPhone operating system within its first six days. What’s more, sales of iPhone units seem to track with Rogers’ theory, building a solid base in their first year (3.7 million units). By the following year (2008), 13.8 million units shipped, while 25.1 million of the devices shipped in 2009, according to IDC. The launches of both Gmail and Google Wave tapped into the psychological idea of scarcity, with Google issuing a limited number of “invitations” to use those services before they were finally rolled out to the mainstream.

When all is said and done, it is important to remember one thing, an early adopter of technology products need not be an early adopter for sports equipment’s. Every product would have its own set of early adopters. So be sure to stay current. Find those innovators in your target market and they could help you identify the next big thing!