Compass Points: Book Review

How Hits Happen
Forecasting Predictability in a Chaotic Marketplace

by Winslow Farrell

One truism we have often heard in strategy seminars is that you can’t plan your way into a fad. Thus, the success of Ty’s Beanie Babies or Tamagotchi cannot be the result of good strategy - they are merely accidents that we would all like to have. In How Hits Happen, the author postulates that hits of any sort actually have some common elements that we can seek when attempting to emulate Furbies and pet rocks.

Most of this book details the history of large-scale artificial life simulations used by Coopers and Lybrand, and the text leans to the poetic rather than the practical, but there are still several nuggets of usable information:

Target people who “lead” your market. These are the equivalent of the “cool kids” of our Junior High School years - they tend to adopt new buying patterns before everyone else does, and others in the marketplace follow their lead.
Generate excitement about your products or services. Just another product is NOT noteworthy. To get people talking about you, you have to do something a little off the wall.
Understand the patterns customers use to distinguish a “good product” from a “bad product”. This enables you to find the cues that will give the customer instantly good feelings about your product.
Remember that you are targeting customers who are human beings. They don’t think of themselves as, say, young professionals. Most customers tend to think of themselves in terms of what they consume.
Create and nurture communities of evangelists who will preach the joys of doing business with your company. Involve them in your product design. Play golf with them. Give them special treatment for being your ambassadors to the market. Software companies, for example, often send pre-release beta versions of their products to their most ardent supporters.
Watch for signals that your market is about to change precipitously. The “explosions” that create hits can often be created with just a little push in the right place at the right time.
The internet is a powerful medium for generating hits. “Buzz” in an internet discussion group or on a web page can translate into powerful word-of-mouth advertising outside of the internet. This is true because many of the risk-seeking early adopters who help to “create” hits are spending a lot of time on the internet these days.
Manage availability to enhance your hit status. Sometimes, being ubiquitous helps build network externalities which make your product more valuable to the buyer as more and more customers get on the band wagon. In other instances, scarcity enhances perceived value by making your product something the customer has to work to obtain.

In all, we’d like to see a book like this that is a bit more prescriptive than descriptive, but How Hits Happen is still engaging and thought-provoking.

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