Why do Enthusiast brands become obscure?
First of all, who are these enthusiast brands?
Enthusiast brands are companies that start on a small scale, founded by few people. Since these companies don’t have a lot of capital they rely on making innovative products. And instead of having global advertisement campaigns they rely on “enthusiasts”, people who are willing to go out of their way and look for noteworthy products. It is these people who then advertise the product through word of mouth. This is often known as inbound marketing.
However, no matter how successful an enthusiast brand becomes, it is often not able to sustain its existing business model. This can be explained using the following business principle:
Companies make money primarily from one or more of these strategies
• Scaling up: Making products in large quantities so that it can sell more
• Profit margins: Having higher profit margins
• Costs: Having low costs of production
As it turns out, the enthusiast crowd offers the exact opposite
• Scaling up: The enthusiasts are less in number, hence not a large audience to sell products to
• Costs: To appeal to enthusiasts, companies have to invest a lot and create the best products
So how do these companies survive in the market?
A variety of brands have taken different routes in this regard. There are 2 main strategies that have been adopted:
1. Going mainstream
The most obvious one being dropping the enthusiast tag altogether and focusing on going mainstream. An example of a company that is doing this successfully is Oppo. The phone manufacturer used to manufacture phones with cutting edge specs and had a great developer community. Now they focus on making midrange phones that are targeted to youngsters.
From launching the Find 7, the world’s first smartphone to have a Quad HD display to making phones having a good selfie camera, the company has successfully managed to become the 4th largest smartphone vendor in the world
2. Finding a middle ground
Pleasing both enthusiasts and the mainstream audience
Going all out mainstream is a risky strategy, companies risk not being able to break into the mainstream market while leaving behind their early adopters: the enthusiasts. Hence, companies these days are trying to find a middle ground: to be able to appeal to both sets of consumers.
This strategy has seen mixed results. While companies like One Plus are on the road to success, brands like Pebble have gone into obscurity trying to do so.
Pebble was a company originally funded by a Kick starter that made smart watches. Wanting to go mainstream but at the same time not upset their original enthusiast audience, they started making lifestyle smartwatches and advertised them aggressively. However, the idea did not take off and the company was eventually bought by Fit-bit.
In conclusion, companies always try and go from early adopters further into the products lifecycle. Some try to do this on a wholesome manner, while others remain in the middle.
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