Final answer:
Early adopters are influential consumers who are viewed as trendsetters and are crucial for the diffusion of new products. Businesses use the bandwagon fallacy to appeal to these individuals and strive for repeat customers to build a strong reputation. Successful firms benefit from the advocacy of early adopters, a factor that can allow them to command premium pricing.
Step-by-step explanation:
Customers with an early adopter mindset are inclined to try new products or services before the general population and are often seen as trendsetters. These individuals contribute significantly to the diffusion of new innovations, and their endorsement can be vital for a product's success in the market. Advertisers target these consumers by tapping into the bandwagon fallacy, which is a persuasive technique suggesting that people should do something primarily because others are doing it.
The influence of early adopters can lead to them spreading the word about a product or service, thereby becoming important referral sources for businesses seeking to establish a strong reputation. Firms understand the value of having repeat customers who can recommend their offerings to others, as a good reputation greatly reduces concerns regarding product quality. In a competitive market, entrepreneurs who skillfully leverage the trendsetting behavior of early adopters and maintain a favorable reputation can command higher prices and thrive.
For example, a hipster's cultural irony, being both intellectual and trendy, may depict them as the perfect archetype of early adopters, shaping and influencing market trends significantly.