Harbingers of Failure

Some people have a knack for buying products that flop, supporting political candidates who lose and moving to neighborhoods that fail to thrive. These people are known as “harbingers of failure.” In fact, entire neighborhoods have been identified as harbingers of failure by zip code. If households in these zip codes adopt a new product, this is a signal that the new product will fail. In 2015, a team of researchers at MIT analyzed transaction data from 130,000 customers at a large national retail chain. They found that 25% of customers consistently buy products that end up flopping within three years — think Crystal Pepsi, Watermelon Oreos, Frito-Lay Lemonade, and Jimmy Dean Chocolate Chip Pancake-Wrapped Sausage. Harbinger customers’ purchases are also systemic. Those who buy failures are more likely to buy failures in different categories: A consumer of Hershey’s Chocolate Scented Pencils (disaster) would be more likely to buy Cheetos Lip Balm (epic fail). So, who are these mysterious prophets of floppery? Unfortunately, current scientific research is pretty limited on this front, but scientists do know that harbingers’ shopping habits differ from their peers in several ways. They’re more likely to purchase less expensive items, be early adopters of new products, and forego writing product reviews. On a demographic level, harbingers seem to be slightly older, less urban, and have a lower household income and home value than non-harbingers who shop at the same store. Now, here’s where things get a bit weird. Subsequent research has shown that these fail-prone consumers tend to cluster in “harbinger ZIP codes” — entire geographical swaths that share the same niche purchase preferences. Even more surprisingly, harbingers’ tendency to pick failures doesn’t stop with consumer packaged goods. They also purchase homes in zip codes that appreciate less in value, they purchase less popular clothing items, and they support losing politicians. One possible explanation for this is that harbinger customers tend to have niche tastes that are often at odds with the mainstream. While harbingers suggest that not all fervent customers are good for business, that doesn’t mean corporate America should attempt to ferret them out and ignore them. Just as brand influencers teach us what works, harbingers can teach us what doesn’t work — and sometimes, in business, that’s just as important.