Book Review: Superconsumers by Eddie Yoon

How to find and sustain growth is the question that haunts founders and executives in today’s hyper-competitive world. Many books we have reviewed in this column so far were part of the literature that strived to find a solution to the growth problem.

Andrew Chen’s The Cold Start Problem featured network effects as the solution to the problem. For Tony Hsieh, it was the company culture that held the keys to extraordinary growth. Geoffrey A. Moore’s cure was based on a strategy focusing on a niche you could dominate from the start and expanding from that.

This month’s book, Superconsumers, is written by Eddie Yoon, a growth strategist and a business consultant. In Yoon’s perspective, companies willing to nail the growth game should find, nurture, and capitalize on a group he calls superconsumers (surprise, surprise).

The theoretical framework

Superconsumers are your best-fit customers who immediately recognize the value of your product, make it a central part of their lives, and simply can’t get enough of it. These people are different from heavy users who buy a product in large quantities. They are passionate about a product in a way that other customers are not. They have a quest in life, and the product they identify with plays a big part in satisfying that quest. Yoon shares two facts to illustrate the impact superconsumers can have on whole industries:

• One-third of all consumers in the office supplies market drove 70 percent of the profit,

• 0.15 percent of gamers account for 50 percent of in-app purchase sales (that is, just 15 out of 10,000 gamers create as much as the remaining 9,985).

The book is heavily built on the job theory of Clayton Christensen. It defines superconsumers as people who develop a strong bond with products they use to satisfy certain jobs or quests. Eddie Yoon also borrows from Christopher Lochhead and his friends the “category creation” idea. According to this perspective, superconsumers are the customers who help a product realize its potential in a category it created. No brand gets to be a category king without understanding and leveraging its superconsumer base first.

What makes superconsumers so special?

Yoon’s focus on superconsumers as the engine of growth stems from his work as an analyst and consultant over the years. Having studied Nielsen’s Homescan database, Yoon and his friends were able to create a data set of 125 consumer goods categories with a total sales volume of $400 billion. His four key observations are:

• Superconsumers offer a higher ROI on the marketing dollars spent. They buy more products at higher prices, and they don’t mind price increases as long as they get a better product or experience. They not only spend more money than regular customers, but their enthusiasm can be infectious, too. Regular consumers spend 20 percent more in markets with a high concentration of superconsumers. Shops and stores frequented by this particular customer profile draw in other customers as well.

• Superconsumers form clusters called super geos. It is these communities that create the buzz and drive most of the profit for a category. These people spread the word on social media, discuss the product in forums, and influence potential superconsumers. It is thanks to super geos that products become trends.

• Superconsumers are not a fickle bunch. They have immense brand loyalty, and the products they like help them satisfy a quest in life, which makes their spending behavior more predictable. Strategies built around them are easier to communicate, implement, and more likely to win buy-in from decision-makers.

• Superconsumers are a valuable source of insights and feedback. They understand a product better than anyone else and can even have their own unique ways of using it. Therefore, co-opting them as informal consultants can broaden the horizons of the product team. Companies should also find ways of tapping into the experience and insights of employees who are superconsumers at the same time.

Final thoughts

Eddie Yoon’s observations come from the consumer goods sector. Although they make a lot of sense, it is safe to assume that some of them will not readily translate into other fields like the tech industry. The business advice that Yoon provides throughout the book is quite descriptive in nature. Actually, the book reads like a collection of sensible recommendations but lacks a coherent, actionable plan. It tells you what to do but not how you can do it.

There is a lot of literature written on the customer groups that we refer to as ideal customer profile, best-fit customers, or superconsumers, all of which roughly describe the same concept. Yoon’s explanation of super geos and the impact they have on regular customers is an impressive contribution to the business literature. But for readers looking for a game plan to follow, authors like Clayton Christensen, April Dunford, and Anthony W. Ulwick offer far better alternatives.