If you are going to take a break from digital “bliss” by putting your phone down, take the time to read this Harvard Business Review primer on augmented reality. “Augmented” is not the same as the “virtual” reality which your children love and of which you make fun. Augmented reality bridges physical reality with the data that all of the machines around us are generating utilizing a screen attached to our face (aka glasses). Think of a heads up display on a fighter jet.
So you can be on a plant floor, retail store, trading floor, or hospital and see the reality in front of you merged with the data that can assist you in making better and faster decisions. It’s well worth the read and sitting with your team to think through the implications for your business. One way we hope to use this technology is with our mechanical team so they can access repair manuals in front of the machine instead of going back to a terminal. Download the app before reading the article and it will literally jump out at you from your phone. This reality does not bite!
One of my good friends, Kevin Coupe of Morning Newsbeat, scored one of the best interviews of the new year. In his conversation with Tom Furphy, a former Amazon executive, he drills deep into Amazon’s secret sauce as well as its implications for the rest of us who are living through the “black plague in retail”. From overall retail to the impact of Alexa, it’s a great conversation, or as Kevin would say, “An Eye Opener” and you won’t find it in the Wall Street Journal or the NY Times. You can listen to the interview here: The Innovation Conversation
A theme for this year is going to be how big brands reinvent themselves to look “smaller” and more authentic. Between Amazon, Aldi and a generational bias towards less processed food, the big brands are under incredible pressure. But there is light in the tunnel. When the owners of brands invest in the “soft marketing” and brand building that is not price/promotion focused, they have a pathway to beat back the changing retail structure and dominance of low cost retailer managed private brands. The 2017 story of Cheetos creating a pop up restaurant is a great example what the winners will be doing over the next few years.
The Wall Street Journal: “The Spotted Cheetah, a pop-up restaurant small big brands specializing in dishes made with Cheetos, has sold out all of the roughly 300 reserved slots for its three-day run, say officials with PepsiCo’s Frito-Lay division that makes the snack … Spaces were gone within six hours of last week’s announcement of the opening, officials said, adding that there is currently a waiting list of more than 1,000 people should anything become available.”
“The Cheetos restaurant, helmed by celebrity chef Anne Burrell, will feature several varieties of the snack in close to a dozen dishes … Menu items, priced from $8 to $22, include Cheetos meatballs, Cheetos grilled cheese with tomato soup and Cheetos-crusted fried pickles. There are even desserts made with Cheetos, albeit the Sweetos variety of the snack.”
Sweetos? Now that’s something private label can’t do!
To understand Amazon‘s success, I need to digress a bit. A few years ago I visited a leading mid-western department store retailer on a regular basis overseeing their work with a brand they licensed from me and my partner. At the first few meetings in 2008 there were 5 people in the room (three from the retailer) as we meandered through a “new” corporate headquarters filled with empty chairs and easy parking.
Within two years the meetings were with a team of over 25 people (we were still 2 people) and my partner was introducing members of the retailer’s team to each other after fighting to find a big enough and unused conference room, never mind finding a parking place. Other than killing our brand along with many others they licensed during that period, the handwriting of bad management was literally around the overcrowded table around which no one could move forward.
With that story in mind, one of the better “digestif” pieces about Amazon/Whole Foods is in Harvard Business Review. The analysis focuses on investment in R&D and its clear where this story will end. But there is a chart buried in the story that is amazing. It lists, by year, the new initiatives taken by Amazon and whether it was successful or not. Red means bad and blue means success. Blue outnumbers red, but not by as much as you’d think. What is “Blue and Red”, is how innovative Amazon is relative to all others. We all knew this, but the chart captures the epic pace of innovation.
As I said in an earlier post, this is the Waterloo moment for the grocery industry and all of supporting brands because of the private label angle. Scott Galloway of L2 has a chart that illustrates private label penetration at Whole Foods vs Amazon Fresh. Brands must innovate and fast.
So what is the HBR secret innovation sauce analysis? “Amazon CEO Jeff Bezos famously believes that if you can’t feed the team with two pizzas, it is too large”. Thank God my competitors don’t even think of pizzas! There is clearly much more to innovation, but as they say, size matters.
There is no better moment than realizing your brand is strong enough to move outside of its original category into an adjacent category or even make the epic move to a “lifestyle” brand.
The NYT had a great story that addressed the move of brands such as Aston Martin into the lifestyle category. Aston has licensed its name to a line of residential apartments in Miami, speedboats and sunglasses all derived from its “art of living” experiences which built upon the brand’s storied history. The key was finding partners who were as dedicated and knowledgeable about branding as Aston.
But the fun part of the article chronicles the bad moments when brands reach for a “bridge too far” or found the wrong partner. Colgate brand frozen dinner entrees, Zippo perfume and Harley Davidson cake decorating are worth learning about. Of course being the NYT, they could not “resist” throwing in a Trump licensing angle too.
The reality is that licensees who are sophisticated trustees of the brand’s adjacent
core values usually add value. The issue is when a large company sees the dangling image of guaranteed minimum royalties without taking a deep dive into brand management issues that come from choosing the wrong partner. As the article notes, “shoddy” work can be catastrophic for a brand not only in the extension, but in its core product.
The article quotes the brand expert Larry Light “Just plopping a brand logo onto a product… is a recipe for failure. Giving somebody the logo and then hoping the execution will live up to the brand promise-that’s a very risky strategy”.
Power Stick frozen entrees? Has a whiff of success, n’est pas?
Housewares is not a consumer category that screams for technology, but sometimes a company breaks through with design that stands out for both form and function. Recently a company called Simple Human planted its flag in the housewares section. Their slogan is, “we design tools that help people become more efficient at home.”
With well thought out garbage cans, auto dispensing liquid soap machines, and the best personal makeup mirror in the market, they are the leader in blending technology with the every day tools of the kitchen and bathroom. My favorite is their makeup mirror. With LED lighting that can be set via your phone to mimic lighting conditions of an office or a restaurant, a woman (excuse the transition) or a man, can see how their face looks under the varied light conditions of the day or evening.
Sadly I need something that does not exactly replicate the middle age face I’ve caught staring at me some mornings, but that may be a technology too far away!
It’s rare, but sometimes the New York Times actually lets the facts get in the way of a good story, and there it was… Continue reading “Penultimate Fragrances”
I’m boarding a crowded plane in the Middle East for a short flight on a very hot day. Olfactory challenges are omnipresent and I’m about to pray for Continue reading “Does Bacteria Make You Look Younger?”
A friend in the venture capital world just sent me this story about an interesting idea that brings unit-dosing technology mixed with disco era chic to an anti-perspirant near you….. I’m sure there is a market for the product, but the more interesting discovery was the website that curated the story: www.nocamels.com
Continue reading “Disco Chic Under Your Arms? It Leads To A Better Place…….”
Coming soon to a home inkjet printer near you is the capacity to print your favorite makeup. Grace Choice, a Harvard Business School graduate who must have decided that investment banking for the overbanked was not for her, invented a system for “hacking” an inkjet printer to make your own custom color cosmetics. According to Bloomberg Business Week , the tool is aimed at 13-21 year olds who are already turning to the online world of makeup tips and ideas.
Continue reading ““Soda Stream” for Home Makeup?”