Critical Mass is a term the world of business adopted and altered from the original physics term. It refers to the chain reaction that happens after a certain volume of something is reached. In the circumstance of business, the volume is the amount of users and a chain reaction is satisfied customers sharing their positive experience with others, who then also become a user, beginning new cycles. Reaching Critical Mass is the point of a business’s lifespan where it becomes self-sustaining and can continue to grow by its own revenue and profit from user generated chain reactions, no longer requiring external investment. With that profit, it can reinvest in itself and reside above the Critical Mass point, by expanding its resources to create more products that create the same type of chain reactions.
The most important thing when striving for Critical Mass is the user base – a minimum amount of users required for a product to function as intended. If there are too few users, the odds of someone learning about a product from word of mouth is low due to the slim chance of a nonuser encountering a user. Consider the recent video game fad Fortnite: the challenge and fun of the online game is to create your regular teams but play against new people each time. This was achieved by having more than 300 million active players. If only one hundred people played it in total, then the gamers would have grown bored and tired of it quickly. Fortnite took off because the players enjoyed the product and shared it within their networks, thus creating new cycles which then helped Fortnite reach the critical mass user base, and grow from there. Ergo, estimate the minimum user base requirement to make your product function properly, listen to early participants, adjust and adapt, and watch the chain reactions multiply.
For example, the same concept of a wide user base is also valid with a marketing department using a variety of content to collect a large user base. The goal is that someone continually comes across new ways to interact with a company through different content. Use multiple avenues and don’t put all the eggs in one basket. If the ads, the posts, the emails, etc., aren’t well constructed and are painful to navigate or are misleading to users, they may not find anything of interest, become frustrated and leave the funnel. This is where knowing the target audience and the ideal consumer’s journey is pivotal. The diversified forms of content need to be well enough interconnected to where it’s a natural journey for the user and leads to a ripple effect of purchasing and sharing with others. As the volume amount of people using your product – having been attracted by various ways – continues to climb, the more users it will attract because there’s something exciting happening and they don’t want to miss out. When there are enough of these ripples, Critical Mass is reached and the business then becomes self-sustainable.
Note: loyal, satisfied consumers generally share their experience with others, thus growing the product user base. Staying committed to the goals that have been set, given that they are S.M.A.R.T.* goals, will be more effective at creating loyal consumers than continually jumping between industry trends or hasty remedies – this will confuse consumers because of incongruent branding. Listening to the first users is going to be crucial because this is when you find out early enough what can be improved and changed before too much loss of resources. Only the firms that listen to their users become successful and the earlier they begin to listen, the sooner and better chances they have to reaching above the break-even point.
Tools to Check Critical Mass
There is no straight answer when Critical Mass is reached since every industry and product varies and requires a different amount of users to fulfill the base requirement. For example, a social media or live game play typically needs hundreds of thousands or millions of people to work as intended, where as a small town market may only need a few hundred customers to begin thriving. The attempt is to map human behavior which is a difficult feat for anyone, but there are tools available to roughly measure and gauge when Critical Mass will be achieved.
KPIs (key performance indicators) are going to give the most visual clues for reaching Critical Mass. This may include brand engagement metrics – how much the public is engaging with the brand, whether in-store, on the website or on social media, or it may include measuring a positive cash flow, meaning a profit is being earned. Chances are high you’ll need to use more than one KPI. There are many other KPIs available – what a company uses depends on the product or service they produce, the marketing techniques they use and the amount of competition that exists within that market. Having tools and graphics can put things into perspective and motivate employees to keep reaching for the ultimate goal – self-sufficiency from reaching Critical Mass.
Obtaining Critical Mass is a highlight and celebration for any business. It involves figuring out how to achieve chain reactions from users to the point of a constant stream of profit and the amount of time and steps it will take to reach this. Essentially it is the defining point between a business that is failing and a business that is successful. At Logical we understand how momentous and vital it is to reach Critical Mass for a business – so much so that the definition lives on our home page serving as a constant reminder for us and our clients of what to strive for!
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*S.M.A.R.T. is an acronym used to describe a method of defining goals. It stands for specific, measurable, attainable, relevant and timely.
Want to learn more about Critical Mass? Check out these references!