First Minder Advantage

OK — so we’re all familiar with ‘first mover advantage’.

As Harvard Business Review put it: a firm’s ability to be better off than its competitors as a result of being first to market in a new product category.

Spoiler: the jury is out as to the degree this phenomenon actually exists.

No matter.

What we care about is First Minder Advantage.

Whether or not you are 1st, 2nd, 3rd, or 10th into a new product category doesn't guarantee you will become the market leader and dominate it.

The reverse is true. You can enter 1st, 2nd, 3rd, or 10th and come out on top.

Google wasn’t the first search engine. Facebook wasn’t the first social network. etc.

What actually matters is being first to own that product category in the mind of your target customers. At scale.

Once you own the category mentally, it’s reaaally hard for somebody else to turf you out of it.

WTF does “owning a product category in the mind” mean?

When a prospective customer thinks of that product, they think of you first.

The two are connected.

• 🔎 Search…. Google

• 💻 CRM… Salesforce

• 🍕 Late-night takeout debauchery… DoorDash

Theoretically, Google could lose the majority of its market cap overnight if people just decided to use another search engine en masse.

The physical switching cost act required to do that is relatively minimal.

But, consumers don’t because Google definitively owns the search category in the mind. Taking them head-on at their own game, as Microsoft did with Bing, just ain’t gonna work.

This is based on the cognitive development theory that people categorise brands and products into mental folders.

For each category of product there is a mental folder.

For each mental folder there is a dominant brand.

At the point of product need:

1. The mental folder is queried in the mind

2. The dominant brand or product surfaces first

3. The demand for it is incepted

If I ask you to order southern-fried chicken… what are you thinking of?

The easiest way to own a category mental folder like this is to be first.

You imprint there and you get all the credibility. It’s a halo effect that enriches the key points of evaluation of your proposition.

Even if competitors pop up and offer a superior offering, they are approaching from a handicapped position because you were first.

The customer by default perceives you, rightly or not, to be better and more competent.

The pioneer.

Why first?

It’s an almost universal human phenomenon that we tend to remember and hold in high regard who we perceive did something useful or notable first.

Everyone else after that doesn’t really get much of a look in. The lion’s share of attention is on who did it first, not who did it second or third.

Neil Armstrong was the Commander of Apollo 11 and first person to step on the moon. He’s one of the most famous people in history (and probably will be for hundreds, if not thousands of years).

So… who was the Commander of the next moon-landing mission, Apollo 12?

Hardly anyone knows. 🤷

That’s despite the fact, objectively, that Apollo 12 was a superior mission in terms of successfully executing a precision landing and the broader remit of science experiments conducted.

The catch

Imprinting your brand into a valuable new product category mental folder like this is pure gold. The holy positioning grail.

It’s the reason why NFX declared ‘brand’ to be 1 of only 4 types of long-term competitive defensibility.

The catch is, the act of launching a new product category first doesn’t by default secure your brand first minder advantage.

As it turns out… a company launching a new product category isn’t the same thing as Neil Armstrong taking his first steps on the lunar surface.

You can’t replicate that instant mass exposure.

And, you can’t replicate the moon.

Huh?

To use an analogy, the moon is a clearly defined object and concept.

Upon creation, a new product category or is not as clearly defined.

It goes through various stages of rapid change, before settling down into an ordered state that reflects the physics of its environment.

It’s more like the earliest stages of the solar system when the planets were forming from scattered matter surrounding the sun. The outcome and the eventual look and shape of it is very uncertain.

Emerging companies — like emerging planets — compete for resources in a new product category and they each take shape differently. Eventually, they settle down into distinct entities, occupying different positions.

Until there is order, the product category mental folder is up for grabs.

Consider the cola category. After Coca-Cola launched in the late 19th century, hundreds of imitation brands popped up that were all vying for position. It was chaotic, inconsistent, and unstable. Today, the cola category is very structured. There’s a stable two brand cola system — Coca-Cola and Pepsi.

Hold that thought.

How to be first

The real question, then, is how do you be first into the mind?

Well… you could try being first into a new product category.

Inventing it, essentially. That sometimes works.

But, it’s far from guaranteed that someone won’t come along later and push you out of the emerging mental folder you created with their brand during the early solar system years — when the look and feel of the category is taking shape.

Like Google did to Yahoo! in search and Facebook did to Myspace in social networking.

Even the power of network effects didn’t save MySpace from Facebook.

So what can you do, to improve your chances of achieving first minder advantage, then?

Focus your positioning. So it’s razor sharp.

As Michael Brandtner wrote in Radical Brand Focus:

Brands and products that achieve first minder advantage are focused.

Their idea is focused. Their brand is focused. Their product is focused. Their messaging is focused. Their value proposition is focused.

They’re able to identify the essential essence of where the category is organically funnelling to in terms of user adoption motivators, zoom in on it, and jettison everything else.

By ripping out the noise and ambiguity, they forge the defined category path ahead that others follow.

They also promote the category first, not their brand. People care more about categories than the brands representing them.

Significantly, first minder brands distil the category idea. So it becomes crystal clear in the mind of customers. This experiential focus defines the category.

Among the competing brands vying to own a new product category as it takes shape, the mind tends to adopt the clearest and cleanest implementation into the mental folder.

Why?

The mind likes clarity, not confusion.

The mind likes simple, not complicated.

The mind likes specialists, not generalists.

Scaling mind adoption

The degree of focus also has an outsized impact on word-of-mouth.

That is, the level of virality to which your brand and associated category spreads organically, person-to-person.

This is a key lever in scaling mental adoption. So you hit escape velocity with your brand and achieve defensible critical mass.

Clear ideas are easily understood and repeated.

Focussed category ideas spread. Murky ideas don’t.

The clearer it is, the easier it travels.

Academia

What’s the supporting evidence (in science) to suggest First Minder Advantage actually exists?

Let’s reference this against theories and experiments in psychology and cognitive science:

🗂️ Schema Theory: Schemas are cognitive structures that help us organize and interpret information. When a product becomes the first to be associated with a specific category, it forms a schema in consumers' minds, making it easier for them to remember and understand that product. This helps the product retain a strong presence in the consumers' minds and can lead to First Minder Advantage. More detail on that here.

_{From: This theory originates from cognitive psychology and was introduced by psychologist Frederic Bartlett in his book "Remembering" (1932). It was further developed by Jean Piaget, a renowned developmental psychologist.}

🎨 Priming Effect: This is a phenomenon whereby exposure to one stimulus influences a response to a subsequent stimulus, without conscious guidance or intention. In the context of First Minder Advantage, if a brand can first create a strong mental association with a product category, consumers are more likely to think of that brand when they encounter related stimuli.

^{From: This concept is a fundamental aspect of cognitive psychology. An influential study on semantic priming was conducted by psychologists Meyer and Schvaneveldt in their paper "Facilitation in Recognizing Pairs of Words: Evidence of a Dependence Between Retrieval Operations" (1971).}

🔄 Elaboration Likelihood Model (ELM): This model suggests that the way information is processed depends on the likelihood of elaboration, or the degree to which a person carefully thinks about the information. Brands that present clear and compelling information about a product category can encourage consumers to process this information more deeply, creating a stronger mental association and potentially achieving First Minder Advantage.

_{From: The ELM is a theory in persuasion psychology that was proposed by Richard E. Petty and John T. Cacioppo in their paper "The Elaboration Likelihood Model of Persuasion" (1986).}

🧠 Availability Heuristic: This is a mental shortcut that relies on immediate examples that come to mind when evaluating a specific topic, concept, method, or decision. In the context of First Minder Advantage, the first brand that comes to mind in a product category will be considered the dominant one.

^{From: The concept was first proposed by psychologists Amos Tversky and Daniel Kahneman in their paper "Judgment under Uncertainty: Heuristics and Biases" (1974).}

⚓ Anchoring Effect: This is a cognitive bias where individuals depend too heavily on an initial piece of information (the "anchor") to make subsequent decisions. Once a brand is established in a consumer's mind as representing a category, it can be difficult for other brands to shift that initial perception.

_{From: This effect was also introduced by Tversky and Kahneman in their seminal work on cognitive biases.}

👍 Confirmation Bias: This bias refers to our tendency to search for and favor information that confirms our existing beliefs while simultaneously ignoring or devaluing information that contradicts our beliefs. Once a consumer has developed a preference for a certain brand, they may seek out positive information about that brand and ignore negative information, thereby further solidifying the brand's position in their mind.

^{From: This bias was first proposed by psychologist Peter Wason in his research on reasoning and decision-making (1960s).}

👀 Mere-exposure Effect: This effect posits that people tend to develop a preference for things merely because they are familiar with them. In the context of branding, if a company is the first to imprint its product in the minds of customers, it could generate preference due to this increased familiarity.

_{From: This effect was first reported by psychologist Robert Zajonc in his paper "Attitudinal Effects of Mere Exposure" (1968).}

🙉 Cognitive Dissonance: This psychological theory suggests that we have an inner drive to hold all our attitudes and beliefs in harmony and avoid disharmony (or dissonance). When a consumer has decided that a certain brand represents a product category, they may resist changing this belief because it would create cognitive dissonance.

_{From: The theory of cognitive dissonance was developed by Leon Festinger in his book "A Theory of Cognitive Dissonance" (1957).}

🥇 First-In Bias: This bias suggests that the first information we learn about something is weighted more heavily than information we learn later. A brand that achieves First Minder Advantage can capitalize on this bias by becoming the 'first-in' information about a product category for consumers.

_{From: This bias is linked to the "primacy effect" in psychology, a concept introduced by Solomon Asch in his studies on impression formation (1946).}

✔️ Choice-Supportive Bias: This bias refers to the tendency to retroactively ascribe positive attributes to an option one has selected. It's a way of subconsciously justifying your choice. If a customer chooses a brand that owns a mental category, they are likely to remember their choice as being better than it actually was, and ignore the faults they saw in it. This strengthens their mental association between the category and the brand.

_{From: This concept was proposed by researchers Daniel Gilbert and Jane E. J. Ebert in their study "Decisions and Revisions: The Affective Forecasting of Changeable Outcomes" (2002).}

👥 Groupthink Bias: Groupthink occurs when a group makes faulty decisions because group pressures lead to a deterioration of “mental efficiency, reality testing, and moral judgment”. In the context of branding, if a majority of people in a consumer's social circle or wider society associate a certain brand with a product category, the consumer may feel a social pressure to select that brand as their primary choice for the category (even if it is objectively worse than competing brands). This can reinforce the dominance of a brand that achieves First Minder Advantage.

_{From: This concept was coined by social psychologist Irving Janis in his work "Groupthink" (1972).}

Example #1 - Google

Google won first minder advantage in the search category because it was focused on search (originally!).

The product was focused on search. The brand was focused on search. The UX was focused on search. Google was ruthlessly all about search.

The other players in the search category (of which there were many) were not.

Former search market leader Yahoo! was trying to do everything and compete with everyone. 👇

Meanwhile, the big G just did one thing really well. 👇

Google achieved first minder advantage because it clearly defined the search category through its product, brand, and UX.

It had the simplest idea.

Example #2 - Facebook

It’s a similar story with Facebook and the web2 social networking category.

Myspace was at one point a titan compared to Facebook.

Not only did Myspace have scale, it had a ton of features. Users could even play around with the HTML/CSS. Sooo many choices.👇

But, like Yahoo!, this busyness wasn’t the right approach to achieve first minder advantage. It was too complex.

Facebook came in and crushed Myspace with a simpler idea and cleaner implementation.

As the social networking product category was forming, Facebook quickly learned and distilled down what it is. 👇

It defined the category clearly through the product, brand, and UX.

From this, it achieved first minder advantage.

📘 Playbook

• 🧠 Understand First Minder Advantage: Market entry order doesn't determine market dominance; owning the product category mentally does.

• 💡 Ownership in Customers' Minds: You "own" the category if customers think of you first when they think of the product.

• 🥇 Importance of Being First: Humans remember and value who did something useful first. But, it needs to be clearly defined.

• 🎯 Achieve First Minder Advantage: Be the first to imprint your brand in your customers' mental category folder.

• 🔖 Imprint Your Brand: Launching a product doesn't ensure mental first minder advantage; clearly defining the category does.

• 🌪️ Navigate Uncertainty: New product categories undergo rapid change; be ready to iterate and sharply define the category.

• 🔪 Sharpen Positioning: Focussed positioning is critical to achieving first minder advantage.

• 🔍 Focus on Essentials: Identify critical user adoption and retention motivators; eliminate noise and define the category path.

• 📣 Promote Category First: People care about categories more than brands; promote accordingly.

• ☝️ Keep it Simple: The mind prefers clarity, simplicity, and specialism.

• 🗣️ Leverage Word-of-Mouth: Clear, focused ideas spread faster and help achieve critical mass.

• 🌐 Case Study - Google: Google focused on search, defined the category, and had the simplest idea.

• 👥 Case Study - Facebook: Facebook offered a simpler social networking idea and clearly defined the category.

That’s it for today! Hat tip to Michael Brandtner, who inspired me to write this.

I’ll be back in your inbox soon.

Martin 👋

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