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AMA honors MIT Sloan Executive Education faculty for "Harbingers of Failure"

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Duncan Simester and Catherine Tucker have won the 2020 Weitz-Winer-O’Dell Award from the American Marketing Association (AMA). This award recognizes an article in the Journal of Marketing Research that has made the most significant long-term contribution to marketing theory, methodology, and/or practice.

The winning paper, “Harbingers of Failure,” was co-authored with Song Lin (HKUST Business School), who was an MIT Sloan PhD student when the paper was written, and Eric Anderson (Kellogg School of Management), who also obtained his PhD at MIT Sloan (1995). The award was presented in a special session of the Summer AMA Academic Conference.

An Affinity for Flops
In their paper, Simester and Tucker revealed that some consumers have an unerring knack for buying “flop” products—that is, these “harbingers of failure” tend to repeatedly purchase new items that go on to fail in the marketplace. The study on which their paper is based evaluated approximately 77,000 customers who purchased more than 8,800 new products at 111 branches of a U.S. convenience store chain over several years. The more often the harbingers purchased a product, the more likely it was to fail. (A product pulled from stores within three years of its introduction was considered a failure.)

“This is a cross-category effect,” Tucker explained to MIT News back in 2015. “If you’re the kind of person who bought something that really didn’t resonate with the market, say, coffee-flavored Coca-Cola, then that also means you’re more likely to buy a type of toothpaste or laundry detergent that fails to resonate with the market.”

Canaries in Every Coal Mine
It turns out that their penchant for unpopularity even extends beyond ill-fated consumer products to the very zip codes where they live (neighborhoods that fail to thrive) and their choice of (losing) political candidates. As described in a recent New York Times article, the researchers discovered the latter while working with political economist Clair Yang of the University of Washington.

Simester, Tucker, and Yang published the results in a second paper, “The Surprising Breadth of Harbingers of Failure,” in the Journal of Marketing Research. While the researchers don’t yet know what makes these consumers tick, Simester believes they might have a higher penchant for risk and are therefore are willing to try things that are likely to be less popular.

Seismic Shift for Marketing Management
But until more research reveals why these consumers manage to pick failures, Simester notes that marketers shouldn’t focus on total initial sales but rather on who is buying their products. “It’s not just how many people are buying them,” Simester told the MIT Technology Review. “It’s how many of the right people are buying them and how many of the wrong people aren’t buying them.”

“Usually when you’re doing market research, the common wisdom is that people liking your product is a good thing,” Tucker adds. “But what we’ve done in this research is identify a group of people who you really want to [have] hate your product. And that changes the paradigm of market research.”

Catherine Tucker teaches in the Executive Education program Marketing Innovation, offered live online November 5-6, 2020. Duncan Simester teaches in Driving Strategic Innovation: Achieving High Performance Throughout the Value Chain.

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