When I first started writing about entrepreneurs, people were still buzzing about the man who made millions from a rock. Yes, a rock. The Pet Rock came on the market in August 1975. It was a rock cleverly packaged in a small cardboard box designed to look like a pet carrier, complete with air holes. The rock retailed for $3.95. Sounds silly, right? Well, sales were meteoric—millions were sold immediately after its market debut. Pet Rocks had a strong Christmas season, and then sales slowed.
The creator of the Pet Rock was hailed as a successful entrepreneur. But it’s not the kind of success you can predict—or easily duplicate. (Can you imagine writing a business plan for a rock?) The Pet Rock was a fad. And while you can make money from a fad, you can also lose your shirt.
The difference between trends and fads
At a glance, trends and fads may seem like the same thing. It can be confusing since we usually describe the latest thing as “trendy.” Fads and trends often emerge the same way—a new product or service suddenly becomes popular and generates a lot of buzz. It’s what comes next that marks the difference.
Fads have a half-life, while trends boast some staying power. Trends can last a decade or more and even when they do end, they tend to fade away more slowly.
Sometimes something starts as a fad, becomes a trend and then morphs into a solid business. Think Uggs. Or a trend loses its buzz, but becomes entrenched in our daily lives, like cupcakes.
Fads are not bad
There’s nothing wrong with investing in a fad. The problem arises when entrepreneurs mistake a fad for a trend and put all their eggs in that basket. Remember, the life cycle of a fad is short. They burn bright; then they burn out.
Timing is everything. If you hit it right, you can make a lot of money, but it’s risky business. Success is really a matter of serendipity. You not only need to know when to get in, but more important, you need to know when to get out. If you don’t time your exit right, you can end up with warehouses full of expensive excess inventory.
Becoming a trendwatcher
Trendwatching is not complex. It’s simply about paying attention and being proactive. Here are some things you can do to become a trendwatcher.
· Read. To stay in the know, check out newsletters, magazines and websites of your industry and related ones. Read your local newspaper and regional magazines. Follow influential bloggers and business thought leaders on social media.
· Hit the road. Attend conferences and go to trade shows. But, realize products you see at trade shows could be fads that have already peaked. Two years ago unicorns were all the rage, only to quickly be replaced by llamas.
· Pop culture. Movies, TV shows, etc. offer a treasure trove of clues. In 1995, a new haircut worn by Jennifer Aniston on Friends, quickly swept the nation. Women demanded “the Rachel.” Hairstylists who were out of the loop instantly seemed old-fashioned and clueless. Fast forward a decade and in New Moon, the first book (and later movie) in the mega-popular Twilight series about a teen falling in love with a vampire, the girl wore lots of plaid shirts. Within months teens girls across the nation were snapping up plaid shirts faster than retailers could keep them in stock.
· Listen to your customers. Often the easiest way to know what’s hot (or not) is track your own sales trends. What’s selling? What’s not? Which of your products are your customers talking about?
The thrill of the fad
There’s no real science to picking winning fads or trends. You can play it safe or you can take a leap. For many, the risk of embracing a fad is part of the thrill of being an entrepreneur.
About Rieva Lesonsky
Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and entrepreneurship, and the blog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah.
Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.
Bank of America, N.A. engages with Rieva Lesonsky to provide materials for informational purposes only, and is not responsible for, and does not guarantee or endorse any of the third-party products or services mentioned. All third-party logos and company names mentioned herein are the property of their respective owners and are used under license from Rieva Lesonsky.
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