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Source: The Unexpected 51

into an aggressive competitor, a strong number two in the United
States, and a few years later, a strong contender for the number one
spot in the rapidly growing European market.
By 1957, Ford had already successfully reestablished itself as a
strong competitor in three of the four main American automobile
markets: the “standard” one with the Ford nameplate; the “lower-
middle” one with Mercury; and the “upper” one with the Continental.
The Edsel was then designed for the only remaining segment, the
upper-middle one, the one for which Ford’s big rival, General Motors,
produced the Buick and the Oldsmobile. This “upper-middle” seg-
ment was, in the period after World War II, the fastest-growing part
of the automobile market and yet the one for which the third auto-
mobile producer, Chrysler, did not have a strong entry, thereby leav-
ing the door wide open for Ford.
Ford went to extreme lengths to plan and design the Edsel,
embodying in its design the best information from market research,
the best information about customer preferences in appearance and
styling, and the highest standards of quality control.
Yet the Edsel became a total failure right away.
The reaction of the Ford Motor Company was very revealing.
Instead of blaming the “irrational consumer,” the Ford people decid-
ed there was something happening that did not jibe with the assump-
tions about reality everyone in the automobile industry had been mak-
ing about consumer behavior—and for so long that they had become
unquestioned axioms.
The result of Ford’s decision to go out and investigate was the
one genuine innovation in the American automobile industry
since Alfred P. Sloan, in the 1920s, had defined the socioeco-
nomic segmentation of the American market into “low,” “lower-
middle,” “upper-middle,” and “upper” segments, the insight on
which he then built the General Motors Company. When the Ford
people went out, they discovered that this segmentation was rap-
idly being replaced—or at least paralleled—by another quite dif-
ferent one, the one we would now call “lifestyle segmentation.”
The result, within a short period after the Edsel’s failure, was the
appearance of Ford’s Thunderbird, the greatest success of any
American car since Henry Ford, Sr., had introduced his Model T
in 1908. The Thunderbird established Ford again as a major pro-
ducer in its own right, rather than as GM’s kid brother and a
perennial imitator.