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Faculty Books: Market Rebels

 

 

Market Rebels

Market Rebels: How Activists Make or Break Radical Innovations
by Hayagreeva Rao.
Princeton University Press, 2009.

• How Markets Are Made and Broken by Social Activists - An Interview with the author from Stanford Business Magazine

 

Activists who challenge the status quo play a critical but often overlooked role in both promoting and impeding radical business innovation. Their importance stems from the very nature of innovation, which frequently challenges existing interests, norms, values, social practices, and relationships. As a result, the joined hands of market rebels—activists and their recruits—have with surprising frequency exerted significant influence on market acceptance of breakthrough products and services.

For example, nearly all of the technical aspects associated with personal computing were available by 1972, but the PC didn’t take off until a few years later when hobbyists, rebelling against centralized computing, organized groups such as the Homebrew Computer Club. These clubs were spawning grounds for actors—such as inventors, founders of companies like Apple, and developers of programs and games—who collectively established the market for personal computers and eventually stimulated the entry of larger companies. Similarly, the hybrid car succeeded partly because market rebels in the environmental movement paved the way by arousing collective enthusiasm for “green” causes among consumers and regulators.

By contrast, radical innovations (such as the Segway personal transporter) have often floundered because their developers overlooked the social and cultural mobilization needed to excite their targeted consumers. more...

 

Selected Reviews

 

From Professor Bob Sutton's Blog

 

"...this is an engaging and useful book, showing how innovations ranging from the automobile to micro-brewing spread -- and why many innovations (like the Segway) did not.

The book is full of useful ideas, but perhaps the central one is that, if you want to mobilize networks of people and markets to embrace and spread an idea, you need the one-two punch of a "Hot Cause" and "Cool Solutions." A hot cause like deaths from tobacco or medical errors can be used as springboards to raise awareness, spark motivation, and ignite red-hot outrage. And naming these as enemies is an important step in mobilizing a network or market. But creating the heat isn't enough; the next step needs to be cool solutions." more...

 

From Publisher's Weekly

 

Rao explores the role of collective action in promoting or hindering business innovation. Drawing heavily on theories of social movements, the author posits a cycle of hot causes, unexpected events or innovations, and cool mobilization, activities that channel emotional responses into popular mass actions that anchor new identities embracing or rejecting the hot cause. Rao presents several case studies in which activist behavior either encouraged or impeded the creation and expansion of new markets, technologies or new organizational structures. For example, early 20th-century automobile enthusiasts were able to placate fears about car safety (the hot cause) by staging hundreds of reliability contests that demonstrated the car's safety and practicality to a wide audience (the cool mobilization). Though dryly written and repetitive, the case studies themselves are fascinating and challenge traditional economic models that privilege individual consumer choice while ignoring broader social mobilizations. A final chapter offers advice and strategies for would-be market rebels looking to harness collective action, making this book a useful resource for both citizen activists and corporate leaders and marketers seeking popular support for their products.