The Weekly (6/2)
Jun 2, 2023
If you work in the tech world, you’re likely familiar with the three-letter acronym PMF or product/market fit. Product/market fit is the holy grail for any challenger company. It’s a sign that there’s a persistent demand for your product, and as Marc Andreessen, co-founder of A16z, famously said in a 2007 blog post, “The only thing that matters is getting to product/market fit.”
NPS, CAC vs. LTV, ARPU, NRR–there are countless ways to quantify PMF, but at the end of the day, you know when you see it. Word of mouth becomes a viral growth loop, focus shifts to hiring account managers vs. account executives, and your marketing team’s job looks simple. Easy to do? Certainly not, but new companies/products find PMF daily.
In our eyes, there’s yet another tier of PMF that few companies or products ever achieve – verbification. Verbification is when a brand achieves such deep market penetration that it doesn't just represent a product; it represents an action.
To Google, to Uber, to Doordash (getting there), this isn't just a testament to these companies’ widespread user adoption, it signifies a degree of cultural imprint that most brands only dream of. Although our team doesn’t necessarily screen for verbification when finding holdings for Flagship, there seems to be a pattern here.
Yet, there’s an intriguing level beyond verbification, which few brands attain – genericization. This is where a brand name morphs into the name of the product itself. A demonstration of true market dominance, yes, but also a step towards potential brand identity dilution.
Band-aid owned by $400 billion Johnson & Johnson, Q-tips owned by $126 billion Unilever, or Post-it owned by $52 billion 3M Co. It's the paradox of success – ultimate recognition, but at the cost of brand individuality.
While verbification and genericization seem to be clear indicators of the true PMF, companies may want to avoid becoming too much of everyday parlance. Take “escalator” or “aspirin” – both coined by early 20th century behemoths, both lost their trademarks before the introduction of color TV. Too much product market fit? Sounds like a champagne problem to us.
In the grand scheme, product-market fit isn't just a tale of numbers; it's a long story of cultural integration and influence. From verbification to genericism, the journey is marked by linguistic shifts, market dominance, and, sometimes, the ironic perils of immense success.
Have a great weekend.
— Your Titan Team
Cash Management
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