{"id":64854,"date":"2022-04-07T21:44:00","date_gmt":"2022-04-08T01:44:00","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=64854"},"modified":"2022-04-19T12:37:26","modified_gmt":"2022-04-19T16:37:26","slug":"why-did-the-ford-edsel-fail","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/why-did-the-ford-edsel-fail\/","title":{"rendered":"Why Did the Ford Edsel Fail? The 3 Reasons It Flopped"},"content":{"rendered":"\n<p>Why did the Ford Edsel fail? What can we learn from this adventure in business?<\/p>\n\n\n\n<p>In the 1950s, Ford Motor Company wasted millions of dollars on the Edsel, a car that is considered one of the biggest product launch failures of all time. In <em>Business Adventures<\/em>, John Brooks shares his analysis, offering three reasons for the failure.<\/p>\n\n\n\n<p>Continue reading to learn why the Edsel was a flop.<\/p>\n\n\n\n<!--more-->\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-why-did-the-ford-edsel-fail\">Why Did the Ford Edsel Fail?<\/h2>\n\n\n\n<p>Brooks writes that, in 1955, Ford decided to introduce a medium-priced car to get a share of the rising demand for vehicles in that price range. <strong>After spending two years and $250 million on research, development, marketing, and PR, the company finally unveiled the Edsel. <\/strong>Unfortunately, the car didn\u2019t live up to the hype and suffered from dismal sales; by 1959, Ford stopped manufacturing it altogether.<\/p>\n\n\n\n<p>(Shortform note: While Ford faced other difficulties after Brooks\u2019 book was published, none of them dealt a fatal blow: In 1982, <a href=\"https:\/\/money.cnn.com\/magazines\/fortune\/fortune_archive\/1985\/03\/04\/65660\/index.htm\">the company lost $658 million<\/a>, but earned more than $4 billion over the next two years. In 2008, it lost $14.6 billion\u2014its worst performance in over a century\u2014but eventually found its footing, avoiding bankruptcy and a government bailout. <a href=\"https:\/\/en.wikipedia.org\/wiki\/Big_Three_(automobile_manufacturers)\">It\u2019s still one of the \u201cBig Three &#8221; automobile manufacturers in the U.S.<\/a> today (the other two are General Motors and Chrysler) and now has <a href=\"https:\/\/www.forbes.com\/sites\/alanohnsman\/2022\/03\/02\/ford-rises-on-plan-to-carve-out-model-e-electric-vehicle-business\/?sh=42e50fa440d9\">a division dedicated to developing electric vehicles<\/a>.)<\/p>\n\n\n\n<p>Why did the Ford Edsel fail? Brooks posits that there were a number of factors.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-reason-1\">Reason #1<\/h3>\n\n\n\n<p><strong>First, the timing was bad:<\/strong> The Edsel might have been what consumers were looking for in 1955, but the market had changed by the time it was released in 1957. Due to an economic downturn, consumer preference had shifted to compact cars, which Ford failed to recognize. (Shortform note: Part of the reason Ford wasn\u2019t able to keep up with the changing times was that <a href=\"https:\/\/www.shortform.com\/app\/book\/no-rules-rules\/part-1\">the company wasn\u2019t agile enough<\/a>. This inability to adapt quickly typically stems from indecisiveness, misalignment within the company, and complacency. In <a href=\"https:\/\/www.shortform.com\/app\/book\/no-rules-rules\"><em>No Rules Rules<\/em><\/a>, Netflix founder Reed Hastings details how companies can overcome these hurdles with a streamlined workforce, an efficient feedback loop, and fewer controls that bog down processes.)<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-reason-2\">Reason #2<\/h3>\n\n\n\n<p><strong>Second, the car itself was mediocre.<\/strong> Through flashy ads and promotions, Ford built up expectations for the Edsel, but the car didn\u2019t revolutionize the industry as promised. Early buyers also complained about the Edsel\u2019s subpar quality and reliability. (Shortform note: The Edsel is proof that even a huge marketing effort isn\u2019t enough to carry a bad product. Entrepreneur and author Gary Vaynerchuk asserts that <a href=\"https:\/\/www.garyvaynerchuk.com\/great-advertising-wont-save-your-shit-product\/\">a great product can generate the kind of word-of-mouth advertising that a bad product can\u2019t.<\/a>)<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-reason-3\">Reason #3<\/h3>\n\n\n\n<p><strong>Third\u2014and perhaps the most damning\u2014the egos of Ford\u2019s executives, designers, and marketers blinded them to the actual demands of the market. <\/strong>Even though the company conducted extensive market research to determine what kind of car consumers were looking for, designers went ahead and created a car based on what they <em>thought<\/em> consumers would like. And, despite commissioning an ad agency and a Pulitzer Prize-winning poet to come up with names for the car, Ford executives disregarded all name suggestions and arbitrarily named the vehicle after Henry Ford\u2019s only son.<\/p>\n\n\n\n<p>(Shortform note: While society tends to think of ego\u2014a combination of ambition, confidence, and a strong vision\u2014as an important ingredient to success, <a href=\"https:\/\/www.shortform.com\/app\/book\/ego-is-the-enemy\/introduction-to-ego\">Ryan Holiday argues that it actually leads to failure.<\/a> In <a href=\"https:\/\/www.shortform.com\/app\/book\/ego-is-the-enemy\"><em>Ego Is the Enemy<\/em><\/a>, he writes that ego causes people to overestimate their skills while underestimating threats and challenges. In the case of the Edsel, Ford\u2019s executives didn\u2019t prepare for failure because they didn\u2019t even consider it a possibility.)<\/p>\n\n\n\n<p>Brooks writes that, despite the Edsel being one of the biggest and most expensive flops in history, Ford executives didn\u2019t acknowledge their missteps, with some even blaming the car\u2019s failure on fickle consumers. They also tended to look back on the experience with nostalgia and fondness. Perhaps they could afford to\u2014Ford managed to survive and even thrived with later releases such as the Falcon and the Mustang. (Shortform note: Some assert that although some executives failed to honestly assess the reasons behind Edsel\u2019s failure, eventually the company\u2019s management did examine those factors, and in doing so, <a href=\"http:\/\/www.adaptivecycle.nl\/images\/Minicase_Ford_Edsel.pdf\">set the company up for future success<\/a>. By evaluating <em>why<\/em> the Edsel failed, Ford was able to distinguish a new market segment and designed cars that appealed to this market.)<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Why did the Ford Edsel fail? What can we learn from this adventure in business? In the 1950s, Ford Motor Company wasted millions of dollars on the Edsel, a car that is considered one of the biggest product launch failures of all time. In Business Adventures, John Brooks shares his analysis, offering three reasons for the failure. Continue reading to learn why the Edsel was a flop.<\/p>\n","protected":false},"author":9,"featured_media":64857,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[45,39,14],"tags":[607],"class_list":["post-64854","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-history","category-management","tag-business-adventures","","tg-column-two"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.3 (Yoast SEO v24.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Why Did the Ford Edsel Fail? The 3 Reasons It Flopped - Shortform Books<\/title>\n<meta name=\"description\" content=\"Why did the Ford Edsel fail? John Brooks shares three reasons: bad timing, mediocre quality, and blinding ego. 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