6 Overlooked B2C Warning Signs You're Losing Product-Market Fit

Product-market fit (PMF) isn’t a static achievement – it’s a moving target, as we wrote before. What worked yesterday may not resonate today, and for many startups and scale-ups, losing PMF can happen gradually. There are the obvious signs of PMF loss, and then there are the signs that are a little more subtle. Importantly, the subtle signs will be different if your product is B2C versus B2B. 

As a product strategy consultancy, we’ve met with startups and scale-ups struggling with PMF erosion, often without recognizing it until it’s too late. Here are six less obvious indicators that your B2C company might be losing product-market fit – and what you can do about it.

1. User Engagement Is Dropping, Even Among Power Users

If your most loyal users are opening the app less frequently, spending less time in it, or engaging with fewer features, it’s a sign that your product is losing its stickiness. These power users are your strongest advocates. If they’re disengaging, something fundamental may be shifting in their needs and your product’s relevance.

How to address it:
Track behavioral changes in your power user cohort. Are they logging in less, purchasing less frequently, or using fewer core features? Conduct targeted interviews and surveys to understand what’s changed for them and whether their needs have evolved beyond what your product currently offers. Then, adapt your strategy and roadmap according to what you learn. 

2. Virality and Word-of-Mouth Are Declining

A strong B2C product grows organically through recommendations and social sharing. If referral traffic, social mentions, or invite codes are being used less, enthusiasm for the product may be fading. Even if paid acquisition is still delivering results, slowing organic referrals could signal that the value proposition of your product isn’t as strong as it once was. Sustainable PMF means users naturally recommend your product, without you investing heavy marketing spend.

How to address it:
Track social shares, referral traffic, and community engagement metrics. Are users still organically spreading the word about your product? If these signals are dropping, investigate whether your product is losing its novelty, failing to provide ongoing value, or facing stronger competition. Among other changes, you might need to refresh your viral loops, improve the shareability of your product’s key features, and ensure that your messaging aligns with what keeps users excited and engaged.

3. Your Ad Spend Is Increasing, but ROAS Is Declining

If you’re pouring more money into paid marketing to maintain growth, but your return on ad spend (ROAS) keeps dropping, it may indicate that new users don’t find the product compelling enough to stick around.

How to address it:
Analyze your user retention and engagement from paid channels. Are new users acquired through ads converting at lower rates or churning faster? If so, revisit your messaging and onboarding experience to ensure you’re attracting and retaining the right customers. It is possible that there is a targeting problem – or, that your product’s value proposition is no longer aligned with the needs and expectations of your core target market. 

4. Retention Curves Are Flattening Sooner

If users are churning earlier than before – especially from cohorts that previously stuck around longer – it suggests your product isn’t delivering sustained value beyond the initial novelty. A product with strong PMF should continue to engage users well beyond the onboarding phase, but if engagement drops off quickly, it may indicate a weakening value proposition.

How to address it:
Monitor retention cohorts over time. Are users disengaging earlier than they used to? If so, dig into user behavior to determine where the drop-offs are happening. You may need to improve ongoing engagement by reinforcing core value moments, optimizing onboarding flows, or introducing retention mechanisms like habit-forming features or well-timed re-engagement nudges. However, make sure that you are not deploying these kinds of fixes as bandaids against a generally eroding product value proposition. 

5. Your Customer Support Volume Is Increasing – But Not for the Right Reasons

It’s normal for support requests to grow as your user base expands. However, if you’re seeing more tickets related to core functionality, confusion around features, or complaints about usability, it’s a sign that your product is no longer delivering seamless value. 

How to address it:
Look for trends in your user support data. Are users struggling with onboarding, experiencing more bugs, or expressing frustration with unexpected product changes? These signals can highlight deeper product-market fit issues that require more than just better UX or in-product training. They may indicate that your product experience is no longer aligned with user expectations.

6. Feature Usage Is Fragmenting

If different user cohorts are engaging with completely different parts of the product, or if some cohorts are skipping over features once considered to be core, it might mean that your product no longer has a clear, cohesive value proposition. User groups might be engaging with your product in a haphazard way, and the efforts you put in based on your company’s internal understanding of your product’s future could well be misaligned with market realities. This is a dangerous path to be on, since it spells losing product-market fit, slowing down growth, and burning through resources without much ROI. 

How to address it:
Analyze feature adoption across different user segments. Are newer users skipping key workflows that were once central to engagement? Are long-time customers disengaging from features that used to drive value? If so, reassess whether your product’s core experience is still delivering a unified and compelling user journey.

Don’t Wait Until It’s Too Late

Losing product-market fit isn’t an overnight event. Instead, it’s a gradual process that can be reversed if caught early. If any of these signs sound familiar, now is the time to take action. The key is to stay proactive, continuously listen to your users, and be willing to evolve your product strategy to stay aligned with market needs.

Need help diagnosing or regaining product-market fit? We specialize in helping startups and scale-ups navigate these challenges through tailored strategy projects and interim/fractional product leadership engagements. Let’s talk.