DISRUPTION AWAITS

Disruptive innovation reverses category clichés to create a dramatically different and better customer experience. It defines the vision that breaks the category conventions and creates a new platform for growth. This approach to innovation focuses on creating a totally new business model, undermines the category leader, challenges category dogmas and maintains the challenger mentality even when the disrupter becomes the leader. 

Think of how Uber has completely disrupted and transformed the taxi-hire business or how P&G works to identify future behaviors which can lead to disruptive new paths of growth. A great example of this is Tide Spin, a smartphone app that allows consumers to order laundry pickup and delivery from Tide-branded couriers. Enter Dollar Shave Club or better yet, Warby Parker.

The eyewear category had lagged behind other sectors in moving online. Less than 1% of purchases in the U.S. glass market were made online and customer experiences of buying glasses were unsatisfactory. Eyewear retailer Warby Parker launched an online business that focused on the provision of high-quality customer service, with low prices. It simplified – and disrupted – the path to purchase by enabling customers to upload a picture of themselves to try on glasses virtually. They could order up to five frames to try and there was no fee for returns. Word of mouth fueled a significant increase in online sales and drove offline sales as well.

THE INNOVATION HYBRID

It is important to remember that there are several different ways to innovate and you may need to explore a couple of approaches in parallel, such as:

Brand-led innovation enables a brand to fulfil its promise or purpose through new products, services and experiences. An example is CVS’s Digital Innovation Lab Its Digital Innovation Lab. The Lab is tasked with making healthcare seamless for customers. Some innovations include an Apple Watch app, which customers can use to fill prescriptions remotely and set reminders to take pills. Using your core to transform your business allows you to identify growth opportunities that you are leaving on the table in adjacent categories and stretch into completely new spaces.

Co-creation or customer-led innovation involves customers early in the process to identify needs and co-create product and service ideas. The process always starts with rich, qualitative insights. Consider riding along a journey with customers through mobile ethnography or inviting customers to share an experience in an online community. Bring customers into the innovation process. Working in teams with customers directly over longer periods builds relationships that reveal their motivations in greater depth.

A great example is the Gatorade: G-Series Product Launch. Gatorade had long been the established market leader in the sports drink category. But when the Coca-Cola company launched its price competitive Powerade, the market leaders needed to sustain its advantage. After an initial flurry of new flavor launches, it realized that it was not maintaining market share. So, its parent company, Pepsi, turned to its lead customers for guidance on where to innovate – athletes themselves. The team learned that in order to outperform at events, athletes focused as much on preparing before the event and recovering after as they did during the event itself. With experts, it developed a unique range of products that aimed to support athletes throughout the total event journey.

FINAL THOUGHTS

Innovation should always be rooted in a relevant customer need and interrogating the existing customer experience is always a smart place to start. Also, a test-and-learn approach is critical to most innovation approaches and requires permission to experiment, fail and learn fast. Risk will always be a part of managing innovation projects, but the best way to ensure your final launch hits the mark is by constantly testing and optimizing your idea with the end customer and in small scale pilots or experiments. Your category is waiting to be disrupted, disrupt and dominate, but remember to never abandon the challenger mentality.

HONORING A GOLDEN GIRL

Recently, I challenged my family, in celebration of the life of my Grandma, Myrtle, to pick one trait that she possessed that they admired and make a commitment to honor her by trying to be intentional in pursuit of assuming or improving upon that trait, personally. I chose Charisma…

Let the others have beauty, I’ve got the charisma.

– Carnie Roitfeld

According to Merriam-Webster dictionary, charisma is a personal magic leadership arousing special popular loyalty or enthusiasm or a special magnetic charm or appeal. Of all of the many wonderful traits my Grandma had, this was just one of many in which she excelled. I chose this trait, because it seems to sum up her presence, the way she could own a room, cold-call with the best of them, hold her head high among even the most elitist, make Miller Lite seem almost high-tone, make a regular weekday Mexican dining out into a memorable fiesta, charm diplomats, capture the attention of children – our personal pied piper – steal your heart with her soulful, deep blue eyes, make you believe almost anything, believe in yourself when you had no hope, give you hope, that she always happened to have on spare. She made you believe in magic and value the bright side of everything. She had an aura – an irresistible charm that would cast spell and always leave you wanting more.

Unfortunately, this is not a trait that you can emulate, in my opinion, it is an uncontrivable, inherent trait within. So my plan is to walk forward with my own version of charisma…an intentional mixture of grace, grit and gravitas – that Grandma would be proud of!

THE COVID-ANXIETY IMPACT ON GEN Z

While the COVID-19 crisis is upending everyone’s lives, Gen Z is experiencing the pandemic at a more formative time of life. However, tragedy is nothing new to Gen Z. The youngest generation experiencing the crisis has grown up in the shadow of many tragedies:

The oldest among Gen Z were 2 years old when Columbine happened. School was never a safe haven; it became a place of metal detectors and lockdown drills.

Many had started kindergarten just days before 9/11. Terrorism and war haven’t been just threats, as they were for children throughout the Cold War, they are real, and the fear is embedded in their psyche.

Most of Gen Z hadn’t even made it out of grade school before they experienced the Great Recession and the highest unemployment since the Great Depression. Gen Z saw their families, or their friends lose their jobs, homes and livelihoods.

Now they are facing a challenge that no generation before them has known. Some are about to enter their adult years, and some are at ages that make this experience an indelible part of the way they view the world. They are likely to be permanently changed by it.

While some of these changes will be short term, but many will be long lasting. Here are some of the ways that Gen Z could be changed by COVID-19, after the immediate threat of the crisis subsides:

Increased Financial Anxiety

The closure of numerous restaurants, gyms, and stores has resulted in many layoffs and employees losing their jobs – and with unemployment claims in the U.S. reaching more than 3 million, young people are getting hit hard. According to a Harris Poll survey, service workers under 22-years-old are losing more work hours than any other demographic. Almost a third of Gen Z workers had been put on leave compared to only 13% of previous generations.

We can already predict that this generation will be financially impacted by the crisis long term – just as Millennials were impacted by the recession when they were coming of age. While it was initially predicted that Gen Z’s spending power would reach $34 billion this year, the sudden entrance of Coronavirus could heavily impact that. But beyond this year, the generation is likely to face difficulties with employment, savings, and reaching milestones at the same rate of that of previous generations.

Stressing out an Already Anxious Generation

While they’re already concerned about mass shootings and climate change – living through a pandemic is just another thing to add onto their already crowded plate of woes and worries. News has started to emerge that young adults make up a big percentage of who’s hospitalized. But fears surrounding contracting or spread the virus and giving it to friends or family are just the beginning of the mental health repercussions of this pandemic.

Studies show that half of Gen Z is afraid of getting Coronavirus themselves, but they’re even more afraid of loved ones getting sick (71%), being stuck at home for a long time (62%) and running out of supplies (54%) (Pulse, 2020).

Anxiety around isolation and financial strains – as many families struggle in the wake of the crisis is likely. As they age, Gen Z will likely be looking for escapes from their innate and now amplified stress, and their focus on mental health will probably intensify.

THE SOCIAL MEDIA PARADOX

According to the report Is Generation Y Addicted to Social Media, Millennials have made social media their top priority and continue to need more usage in order to feel satisfied. While social platforms can enhance connection, excessive use can also lead to depression, an element that’s enhanced by the addictive nature of such apps and the ‘Fear Of Missing Out’ (FOMO) – the trend that swept the globe post Facebook’s launch.

The truth is that social media affects human psychology in unprecedented ways. It activates the reward center in the brain and releases dopamine in the process – the chemical that regulates feelings of pleasure.  So much so that in a recent study, it was revealed that people found it easier to refrain themselves from tobacco and alcohol, as compared to social media.

So while perhaps social media gives us a short-lived shot in the arm, it has been linked to higher levels of loneliness, envy, anxiety, depression, narcissism and decreased social skills. As the narratives we share and portray on social media are predominately positive and celebratory – it is an interesting paradox.

We are seeing the proliferation of users creating an illusion of having more social engagement, social capital, and popularity that in their real life and often are simply masking one’s true persona. Some are leading disconnected, double lives – the one they portray on social networks and their true self, which, for some creates a double consciousness. Your lauded self on social media is constantly seeking more validation through electronic likes, not life.  This “Vanity Validation” not only affects the person posting, creating a false and thin sense of self truth, but also robs others who are engaged in the modern-day version of “Keeping up with the Joneses.” It’s the classic social-comparison theory – the idea that individuals are constantly engaged in self-evaluation comparing themselves to others. The theory suggests that our self-esteem is affected by this social comparison and ultimately can adversely affect our determination of self-worth. In fact, 50% say that using social media makes their life worse. Their self-esteem suffers when they compare their accomplishments to that of their online friends.

So what does this mean for digital marketers? Is advertising on social media or working with social media influencers the equivalent to advertising cigarettes – endorsing and indirectly promoting something that damages wellbeing?  No, it just means being mindful of your content.  Some studies show that social media can have positive effects too by increasing social support, a sense of community, or promoting behavior that does enhance wellbeing.  If we explicitly design social media campaigns in this positive way, then social media campaigns have the potential to promote happiness.

Goodbye Millennials, Hello Gen Z

This is the presentation I created for the American Marketing Association Conference. The goal was to invite marketers into the minds and souls of this very misunderstood generation. Thought I would share the presentation in powerpoint so you can see the voice-over notes.

PERSONAL BRANDING FOR BADASSES

This presentation was developed for the The Interpublic / McCann Group Women’s Leadership Network. The goal was to educate and inspire women to build and bring their unique, personal badass brand to life. I left this presentation in powerpoint so that some voice over notes are included.

WHAT IS YOUR UPSWING PLAN?

Let’s ‘fess up.  We seem to have a distinct craving for shock and awe.  Anything factoid worthy of “Have you heard the latest?!” only to be trumped by “Not only that, but….” can hyper-fan the flames of OMG-infused dismay, disgust, and depression.  In today’s 24/7 instant-ping, insomnia-inducing digital news alert onslaught, it’s easy to get sucked in, if not pummeled and then overwhelmed.  With the Coronavirus pandemic, surely you have noticed a certain predictable, and highly flawed, or at least pathetically under-optimized pattern of response.  

And in fact, the contagious fear may be more dangerous for more people than the viral contagion. The psychological fear [of a disease] is more fearful than the disease itself. According to the WHO, the psychological contagion effect is always more far-reaching than the physical contagion.

Never forget, there is no such thing as an information vacuum. In the absence of credible action-oriented information, people make up their own answers, provide their unfounded expert point-of-view and then spread this false wisdom via social media.  The good news, however, is that our response to this can be radically upgraded, with huge benefits to all. 

The moment you get that start to feel the onset of anxiety fueled by headline-hungry, crisis junky-journalists and our dear personal experts and friends on Facebook, the best thing to do, according to Psychology Today, is to dive in by courageously asking two questions:

  • What is the worst-case scenario?  (Usually multiple levels, that go deeper and deeper).  
  • What can I/we do now to minimize the potential downside?

This is meant to bring the situation into perspective and provide peace of mind. Once you have the situation sized up you can then begin to look forward.  As my mentor used to always say, you must begin with the end in mind. So, go ahead, get out your blank sheet of paper, and come up with the killer “the moment this starts improving….” upswing plan, for gaining insane momentum when the storm clears! 

THE GEN Z CONGREGATION

Though Gen Z is the least religious generation in living memory, they are deeply engaged in questions of belonging and meaning – but often far outside of recognizably spiritual spaces.

Rather, Gen Z’ers building deep connections in gyms, fan communities, arts groups, and maker spaces. Many exhibit behaviors that you’d usually associate with a congregation. Gen Z is remixing and repurposing old spiritual practices to maintain a sense of community. According to Harvard divinity leaders in conversations with the founders of CrossFit and SoulCycle, they have found a growing consciousness of the multiple functions these new communities provide. Six recurring themes have appeared: personal transformation, social transformation, purpose-finding, accountability, creativity, and, of course, community. Here, the connection depends less on shared identity, and more on shared practice.

Now more than ever, we’re living through a crisis of isolation in the United States. The public-health threat of loneliness is undeniable. Studies show that being socially connected is associated with a reduced risk of early death, and that social isolation is now more deadly than smoking 15 cigarettes a day or being obese. To combat this, Gen Z is redefining the meaning and structure of connectedness and community. As spiritual practices, identities, and languages become ”unbundled” from their institutional homes and remixed within families and partnerships, Gen Z’ers are creating their own meaning and community structures more than ever before.

As Gen Z’ers enter a culture and economy defined by increased mechanization, artificial intelligence and virtual reality, remembering what makes them human through music, nature, spirituality and community (on their own terms) will clarify the challenges that lie ahead.

NOTHING BUT A “Z” THING (BABY)

The coronavirus pandemic there’s been a lot of generational finger pointing going on during the coronavirus pandemic – further dividing millennials and baby boomers. Baby boomers are calling out the youth for traveling and going on spring break. Meanwhile, millennials are frustrated they can’t get their boomer parents to stay inside. Each generation thinks the other generation isn’t taking the pandemic seriously enough.

According to an article in Business Insider this morning, a case in point is to look no further than the youth who are taking advantage of cheap airline tickets to book travels. They’ve also been crowding beaches and partying on booze cruises while on spring break. “We’re not worried about it – we’ve been drinking Coronas all day, bro,” a spring breaker who visited South Padre, Texas, told local station KRGV-TV.  Millennials have also gotten flak for flippantly approaching the pandemic with memes. Taking off on Reddit and infiltrating social media, “boomer remover” has become a coronavirus catchphrase among younger generations.  But the problem is that the media is not distinguishing Millennials vs. Gen Z properly.

Baby boomers aren’t throwing their disdain in quite the right direction: While both millennials and Gen Z have been seen using #BoomerRemover and booking cheap travel, it’s Gen Z, not millennials, who are out partying and ignoring coronavirus warnings on spring break.

In fact, Millennials are scared straight. I was just reading in Forbes, that a recent study – as in one week ago ­– on the impact of Coronavirus on purchase decisions and behavior found that while overall all generations are worried about Coronavirus, Millennials are changing their shopping behavior more than any other generation and are earning the title the “worry generation.”

In fact, according to millennials, they’re already heeding coronavirus warnings. It’s Gen Z you should be reprimanding, they say.

“Millennials are not partying,” tweeted National Review reporter Mairead McArdle. “We and our anxiety issues are holed up working from home, watching Hulu, and yelling at our parents not to go outside. It’s Gen Z you want.”

So while not a Millennial myself, in their defense, we need to get our generational segments straight. Millennials turn 24 to 39 in 2020. The oldest of Gen Z turns 23. That means millennials have graduated college – it appears to be Gen Z who are the ones living it up on spring break.

P.S. This post was inspired in part by Dre and Snoop…

WILL CORONAVIRUS MAKE LASTING CHANGES TO CONSUMER PSYCHOLOGY?

We are living in a different world than we were before Jan. 30, when the World Health Organization declared the coronavirus an international public health emergency. In fact, we are living in a world that is different from what it was 48 hours ago or 24 hours ago.

Accordingly, a change in consumer psychology – fear and anxiety brought on by the rapid spread of COVID-19 – is causing a run on pantry and household staples, cleaning supplies, and medicines.

Right now we are all walking around with this heightened state of mortality salience and that creates a sense of existential anxiety. While the effects are harder to predict, it does tend to make people more likely to spend in ways that support their core values and support their self-esteem or to spend in ways that they feel says something important about who they are.

In the short term, this uncertainty is a barrier to discretionary shopping in general, as well as a barrier to shopping in stores.

Longer term, it may predispose people to make choices that are based on their underlying sense of identity. So, for example, people may be more likely to choose environmentally-conscious brands in the future, a trend that we already see in our culture. And it may predispose them to indulge in more luxury purchases as significant to their self-esteem – a trend that was phasing out pre-COVID-19.

Right now consumers are in the throes of deep emotional, irrational fears. They are seeking comforting experiences that will bring them a sense of control which in turn will make them more comfortable. Buying things or having the sense of agency that comes from making consumption choices, is one way they can regain a feeling of control and greater comfort.

So they hoard household supplies, not because there is any evidence that they will actually need them, but the very act of buying them gives them comfort.

Consumption plays an important role in the lifestyle of American consumers. That won’t go away. But retailers and marketers are well advised to plan for potential long-term changes that this crisis may bring to their underlying psychology and the values that underpin their purchasing decisions. 

In 2020 e-commerce is expected to represent 12% of total retail sales, however, a change in consumer behavior in the first quarter of this year due to the coronavirus can impact the future quarters for 2020 and have a profound impact on holiday sales. As the consumer’s comfort with online shopping becomes higher and technology is more intuitive and ubiquitous, the digital side of the retail business may be stepped up at a faster rate than previous projections. To bring consumers back to stores, retailers should increase cleanliness, consider cross-promoting high-demand items and make them easy to find (quickly) on shelves.

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