I’m Shocked, Shocked That GoPro Missed Its Number
GoPro's stock, the gadget darling IPO of 2014, laid off 7% of its workforce and took a big hit in the stock market when it announced it had missed its revenue projection.
All I have to say about that is, "duh."
How big did you think they would get last year? GoPro is now in the very tough early majority phase of adoption, where fewer people in that cohort are interested in the product.
And you can't forecast early majority adoption based on early adopter purchases. Early adopters are a breed apart. They love tech. They take more risks. They try things out and abandon them with ease. Early majority customers are none of those things. And mainstream customers are even less so.
If you want to play armchair prognosticor about a new technology (Apple Watch, anyone?), start with 15 points and take away points by asking four questions:
- If you own a GoPro, when was the last time you used it? If it wasn't in the last month, then take away a point. If it wasn't in the last year, then two points. If you don't own one and don't plan to, then take away three points.
- Could you imagine your neighbor using a GoPro? If not, then take away two points.
- Could you imagine a lot of people at the airport, truck stop, Starbucks, and Disneyworld using a GoPro? Take a point away for each venue where most people won't.
- Would your mother, father, and baby brother or child want to use a GoPro? Take away one point for each that won't.
- Could you imagine a lotta lotta people in China or India or Brazil using a GoPro? If not, then take away three points.
How many points are you left with? I'm left with five points.
For Oculus Rift, I get two points. .
For hoverboards, I get four points.
For consumer drones, I get two points.
For a smartphone, I get 15 points.
The fewer the points, the smaller the market. 15 points means pretty much everybody. Two points means a niche market. Five points means a signficant, but not huge market. Go ahead, try it yourself.
This simple quiz mimics what a solid forecast is based on because it segments the world into groups with different propensities to adopt a new technology. GoPro will do just fine with the segments that love capturing adventures or children or activities. It will do kind of okay with groups that are occasionally interested in those activities. It will be avoided by people that feel they can get most of what they need with a smartphone video camera. So what's its long-term market potential? Decent, but not great.
At Forrester, with our Consumer Technographics data we can analyze each of these groups to see if they exhibit the behaviors and attitudes that would lead them to adopt technologies that improve existing activities or enable new behaviors. I spent five years doing it, and it's some of the most interesting analysis I've ever done. The table top computer market was one we analyzed to convince HP and Microsoft that it was a nice-to-have product with perhaps a niche in hotel lobbies and gaming floors, but not a mainstream consumer product. And so it has been.