This document discusses how firms can leverage early adopters and repeat purchasers to promote their offerings through word-of-mouth marketing. Early adopters and repeat purchasers flatten the learning curve for a product or service, gaining an information advantage over non-users. This creates an imbalance that they seek to resolve by sharing their knowledge with others. Firms should provide tools to help early adopters and repeat purchasers teach others about the product or service in order to shift the burden of promotion from the firm to satisfied customers. When users feel they have personally benefited from a product, they will want to help others gain similar benefits through their guidance.

1. Convert Your Customers to
Teachers
George Howard
Associate Professor • Berklee College of Music
ghoward@berklee.edu
@gah650

2. Both a pedagogical and marketing approach
• Observed amazing “learning” communities in all sorts of business
disciplines, which, viewed through a different lens, became marketing
tools
• Struggled (struggle?) to “break through” with students on topics like
copyright law
• "You do not really understand something unless you can explain it to your
grandmother." (Albert Einstein)

3. Stipulations
• Firms all succeed for the same reason: They shift the burden of
promotion from the firm itself to the customer
• This burden shift occurs via the following:
• The firm creates a [remark]able offering
• The firm places the offering in front of people pre-disposed to care

4. Stipulations
• The maximum value from any firm comes for a small number of
customers
• This heightened Pareto emphasizes the importance of following:
• “Re-purchasers”
• “Early Adopters
• These two groups – and, often, there is overlap – are the dominant
drivers when it comes “teaching” others about firms’ offerings

5. Re-Purchase
• The customer journey:
• Awareness > Consideration > Trial > Purchase | Re-Purchase
• Firms lose money on customers who purchase only once
• The cost of dragging a customer to the Purchase stage will always exceed the
value of a single-purchase customer
• Key equation Profitability = CAC < LCV
• L = Px (when X > 1)

6. Px Loyalty
• Their loyalty is based on their belief that the firm from whom they
repurchase represents a higher value to them than alternative firms
• The Px’s perceived value stems from:
• Lower price than alternatives
• Greater features than alternatives
• Emotional resonance

7. Px Characteristics
• Axiomatically, have established a bond of ethical fiber with the firm
• This bond is apparent via the customers’ purchasing decision; their
re-purchase equates to loyalty in the face of competition (assuming a
non-monopolistic firm

8. Net/Net
Re-purchasers become teachers

9. Early Adopters
• Those at the beginning of the Life Cycle Adoption Curve
• Alternatively called:
• Early Adopters
• Influencers
• Mavens
• They are “information specialists”
• Derive joy from “discovering” things they deem to have value before the
masses
• Are unable to keep this information private

10. EA Loyalty
• EAs loyalty is based on their belief that the firm they have embraced
before the masses represents a higher value to them than alternative
firms
• The EA’s perceived value stems from:
• Lower price than alternatives
• Greater features than alternatives
• Emotional resonance
•

11. EA Characteristics
• Axiomatically, these EAs have a higher (real or perceived – doesn’t
matter) base of information about a firm’s offering
• They dwell on the margin of information scarcity

12. Net/Net
EAs become teachers

13. Px and EA Venn
EAs
(FIRST)
Pxs
(LAST)
Price
Value
Emotional

14. Learning Curve
• Definition – Time/Money spent to gain knowledge
• “Steep” Learning curve = large amounts of time/money
• “Flat” Learning curve = little amounts of time or money
• Both Pxs and EAs flatten learning curves around a firm’s offering
• Pxs do so via actual usage over time
• EAs do so via either initial concentrated usage or via pre-purchase

15. Learning Curve = Information imbalance
• Via climbing (flattening) a learning curve, the customer gains an
information surplus with respect to the firm’s offering as compared to
non-users
• Thus Pxsand EAs have an information imbalance related to the offering they
have repurchased or “discovered”

16. Humans don’t do well with
information imbalance
“Man is by nature a social animal” – Socrates
“If you want to change what I’m doing, don’t try to persuade me - don’t try to make
me - do anything. Instead, enlist the help of my friends…” – Mark Earls

17. The Internet in many ways is a
tool to create
information symmetry

18. Why we teach

19. Kettle boiling over
• A human who has derived personal benefit from a product or service has
an information asymmetry as compared to those she knows who have not
(yet) derived benefit from the product or service
• Humans can not stand information asymmetry….because:
• Information is the only commodity that can be shared in a manner that benefits the
taker without depriving the giver
• Information “sharing” is a transaction that benefits giver and taker
• Giver benefits from ego boost
• Taker benefits from increased knowledge
• Once information symmetry has been achieved both benefit from ability to “relate” around a
shared interest

20. Boiling Kettles
• People who have:
• Discovered Yoga
• Lost weight
• Found God
• Read a “great” book
• Eaten at a “life-changing” restaurant
• Found something to combat boredom

21. Kettles Boil when
• A firm’s offering makes the user feel that they are a more-realized
version of themselves
• (Mirror of Erised theory)

22. Customer as Teacher
• When a user – through flattening the learning curve of a product or service –
feels they have materially benefited from their effort, they will scan their
surroundings for others who they feel might also benefit
• They become a Sherpa/a guide, who lowers the rope down to help others up
• There seems (anecdotally) to be a correlation between time/effort required to
flatten a learning curve and desire to

23. Px Examples
• Car owners
• Private school parents
• Gamers
• Musicians
• Athletes
• Wine Enthusiasts
• Devout religious practitioners

24. EA Examples
• Technologists
• Music Fans
• Film Buffs
• “Foodies”
• Dieters

25. Goal for firms
• Determine if your offering is more likely to attract EAs or Pxs (ideally,
of course, you want both – Apple is the biggest company in the world,
because it (now – didn’t always) attracts both
• Devise a strategy for identifying these classes of users, and provide
them with “teacher tools”/reward those who self identify as teachers.

26. Goals for Academics
• Strive for more opportunities when the student becomes the teacher
• Identify those students who have the information imbalance, and
push them to articulate their knowledge
• Know that this has more to do with concretizing this particular student than it
does educating the other students (but it creates a culture of learning)

27. Questions/thoughts?
George Howard
ghoward@berklee.edu
@gah650