A surprise recent success in the energy drinks category in India is Pepsico’s Sting which has upstaged Red Bull, capturing 90 per cent of the market share within just six years of its launch. Sting’s success in India was thanks to introducing an energy drink at an unprecedented low price point and expanding the market beyond its traditional niche to include blue-collar workers and students.
Sting’s success begs close attention because, in consumer products, conventional wisdom often dictates that success hinges on creating a product that appeals to the masses through a carefully curated blend of features, price, and marketing.
This approach typically involves not deviating from the dominant outline or feature set of the product, as established by competitors. However, a closer examination of the market reveals a different story – one where some of the most unlikely products defy expectations and become industry leaders.
Boundary-pushing
One example is Red Bull. When it first hit the market, in the mid-1980s, the fizzy, taste-challenged beverage was met with skepticism. The unusual flavor profile and high price tag seemed at odds with what consumers typically sought in an energy drink.Yet, Red Bull defied conventional wisdom and became a global phenomenon, challenging the dominance of established players like Coca-Cola. Red Bull held a staggering 43 per cent share of the global energy drinks market in 2022, with sales exceeding $7.5 billion.
GoPro revolutionised the action camera market by catering to a niche segment of adventure enthusiasts and outdoor athletes. Launched in 2004, GoPro capitalised on the growing interest in capturing and sharing outdoor activities by offering compact, rugged cameras designed for extreme environments. Despite competition from established camera brands, GoPro’s innovative products and lifestyle branding resonated with its target audience. By 2015, GoPro had captured an impressive 73 per cent share of the action camera market in the US.
GoPro faced challenges in subsequent years as the action camera market became saturated, and competition from smartphone cameras increased. Nevertheless, the company has remained a dominant player in the action camera segment, with a 21 per cent market share globally as of 2022 and an annual revenue of around $1.1 billion.
Another example is the Dyson vacuum cleaner. Instead of following the dominant thinking of making vacuums cheaper and more disposable and bag-based, Dyson took the opposite approach in 1995 by creating a premium, high-performance product with a distinctive design and advanced cyclonic technology priced at about 2.5 to 5 times that of traditional canister vacuums from brands like Hoover and Electrolux. This unconventional approach disrupted the vacuum cleaner industry and established Dyson as a leader in innovative household appliances. Today, Dyson’s vacuum cleaners hold a 50 per cent market share in the UK and are the best-selling vacuum cleaners in the US.
The Mahindra Thar is an unconventional success story in India’s SUV market dominated by car-derived utility vehicles focused on urban lifestyles. Launched in 2010, the Thar was an unapologetic, no-frills, off-road vehicle harking back to the Jeep heritage. With its rugged body-on-frame construction and four-wheel drive, it appealed to enthusiasts seeking a capable off-roader rather than the typical family buyer. Mahindra doubled down on the Thar’s niche appeal in subsequent generations, even as competitors moved towards monocoque crossover SUVs. Despite its niche positioning, the Thar garnered an impressive 20 per cent market share in India’s SUV segment by 2020. The latest generation Thar’s success has continued with Mahindra selling over 47,000 units in 2023 making it one of the highest-selling off-road SUVs in India.
Challenging assumptions
In his book Alchemy, Rory Sutherland argues that conventional logic often leads brands to the same predictable outcomes, limiting their ability to stand out and truly resonate with consumers. Outlier brands have recognised that human decision-making is not solely driven by rational factors like features, price, and marketing, but also by emotional connections, cultural resonance, and the pursuit of novel experiences. For this, Rory recommends “psycho-logic” – a term he’s coined to describe the integration of psychology, human behaviour, and creative thinking in business decision-making. He suggests that agencies should aim for psychological “moonshots” – achieving manifold and much cheaper improvements in perception through insights into human psychology, rather than incremental technological advances. Though valuable, clients typically shy away from pursuing such discoveries because they “do not have budgets for solving problems they have not noticed.” Arguably, these budgets get created as disposable income accrues due to rising living standards or the life journey of customers.
Another way to look at it is via statistician Nicholas Taleb’s concept of black swans. An event or a brand or its unique product is a black swan if it’s an outlier and highly impactful, and its success is understood only in retrospect. To be able to crack black swan ideas, businesses have to stop depending totally on predictive models based on past data that are thought to be highly accurate and may even have a win rate. Taleb suggests that one must apply “anti-knowledge” — understanding the limits of what we know from data or history alone — to spot opportunities where counter-intuitive brands can germinate.
Prof. Roger Martin of the Rotman School of Management corroborates the pitfalls of over-reliance on data analysis to ideate solutions. Data analysis often oversimplifies complex business realities by making linear assumptions and ignoring non-linear, circular, or ambiguous causal relationships between variables. “The complexity of business frequently overwhelms the data analysis techniques that we employ — at our peril,” Martin notes. This makes it difficult for data analysis alone to predict or foresee truly novel and unprecedented brands deviating from past patterns. Organisations that have the experimentation budget for their products must therefore explore products that do not rely on data analysis or assumptions while continuing to exploit what works well for them.
Embracing fringes
Marketing maverick Seth Godin argues that the most innovative brands don’t just optimise for the average consumer, but instead create products and stories that appeal to the fringes — the overlooked outliers. In his book We Are All Weird, Godin posits that mass companies focus too much on the mythical “centre” of the herd when true growth lies in embracing the edges. Brands like Red Bull, GoPro, Dyson and Thar found success by zealously serving a niche, creating offerings that resonated deeply with their respective “weird” audiences rather than aiming for mass appeal.
Interestingly, what gets made for weird consumers also tends to market itself well, as it gets visibly used and advocated by the most extroverted or eccentric among them. This goes against the conventional product management advice of not incorporating features suggested by a brand’s most ardent fanboys, considered outlier users. However, for truly against-the-grain products, dispensing with such thumb rules may be necessary to connect with passionate niche audiences.
While data provides a crucial foundation, market researchers must recall David Ogilvy’s observation that “people don’t think what they feel, they don’t say what they think and they don’t do what they say.” Then, perhaps, experimentation with the open-mindedness to try, test, and accept a solution found even in an improbable corner is our best bet to unearth the true, underlying irrationalities that drive consumer behaviour.
(Manoshij Banerjee, is an independent consultant on digital behaviour and culture. Mohammed Shahid Abdulla, is faculty member in Information Systems, IIM Kozhikode)