My last blog identified five fundamental trends that can reshape corporate success and sustainable profit growth, prompted by the recent 2013 list of the World's 50 Most Innovative Companies issued by "Fast Company" as well as our own internal business practices at Tetra Pak. They are:
I hear business leaders actively talking about these trends as separate entities. But it is clear to me that they are interrelated and must be taken as a whole to sustain profitable growth in this new age.
Consider speed. There are seven billion people on the planet and three billion Google searches a day; obviously, there's been an exponential growth in information awareness. The way we acquire and spread it has gone from random and incremental to focused and lightening fast. And the fast are eating the slow. Apple's iTunes changed the music business virtually overnight, leading Apple to become the top music retailer in the U.S. in 2008 according to market research firm NPD Group--a position it retains to this day. Landlines became obsolete before they were ever installed in developing countries like Kenya, where Safaricom is the leading mobile network operator and landed on Fast Company's 2013 list for bridging the country's healthcare gap with telecom. And there's Square, number three on the list at just three years old and a fierce competitor to already established giants such as PayPal and Intuit.
All of these increasingly rapid changes are altering our concept of time. Analysts collect real-time data on what, when, where and how we buy, and this information is used to create enormous marketplace advantages, from flashing online customers target ads to texting instant promotional offers. .
Pretzel Crisps used the latter to establish their brand quickly in the highly competitive snack market. They monitored social media conversations to identify their opportunities--namely customers looking for a snack--and physically delivered free samples to them. To maximize their efforts, they selected people in offices and public places, and those with active social networks and followers. And it worked. Recipients conveyed their enthusiasm and positive experiences through tweets, blog posts and product reviews. A single 'interception' could reach 23,000 people. In one year, the brand delivered some 3,600 free samples to consumers, garnered over 4.2 million earned media impressions and saw their sales increase 87 percent.
These examples make the competitive advantage of real time marketing clear. And speaking of 'real time,' if you can't describe your offer in 140 characters or less, you'll likely miss out on the largest cohort of all time--Millennials--which brings us to our second point: age. The two of the largest generations to ever live--Millennials and Baby Boomers--are fundamentally transforming the way we live.
Millennials are the largest generation alive, period, and have grown up in the tech age living with exponential change. On the other hand, Boomers altered the course of history by the way they lived and dreamed--and initiated these changes. But underlying demographics in both groups are leading to lifestyle changes that affect them both in some unexpectedly similar ways. We've identified this as small-sizing, or right-sizing, a new reality I discussed in my recent Huffington Post blog, "Tattoos and Botox Have More in Common Than You Think." Basically, today both generations predominantly live in one- or two-person households, and this has fueled a movement that is playing out in every aspect of life as more and more Americans buy smaller homes, cars and products, and retailers respond with smaller-format stores in urban markets, filled with products in trimmer sizes.
Millennials are also the most diverse generation to ever live, according to the Pew Center's groundbreaking study "Millennials: Confident. Connected. Open to Change." Coupled with the fact that they're also the most connected, they are, and will continue to be, significantly influenced by global trends--and this means we must have a glocal mindset. Of the seven billion people already on the planet, only 465 million, or about 6.4 %, live in North America--a percentage that's expected to remain stable for decades. And our markets are much more mature than most in the other 93 percent of the world. So we have to consider the global markets, but execute and grow in our existing markets and effectively utilize 'global' insights to make us better on-the-ground competitors at home.
If this sounds esoteric, look around the world at products and process innovations and you'll find insights and ideas that you can use in your own market. Mark Rampolla first came across coconut water when he was volunteering in the Peace Corps in Costa Rica the early 1990s, and in 2004 he left a fast-track corporate career to pursue his dream by founding Zico, a company that uses Tetra Pak cartons. Or consider the mango, a wildly favorite flavor in the U.S. for the past few years, though it has been popular in Mexico for decades and its native South Asia for centuries. Suddenly, it's imbued in everything from ice teas and frozen yogurts to jellybeans and vodka.
Global companies can also become your local competitors. Look at Wipro, Ltd. in Bangalore. In the early 90s, notes "Fast Company," it was an anonymous conglomerate selling cooking oil and personal computers in India, but today it is a $7.3 billion multinational provider of IT, consulting and outsourcing services with over 140,000 employees. They write software, integrate back-office solutions, design semiconductors, create apps and more for some of the biggest companies in the world, and do it much more cost effectively than comparable U.S. companies.
So the world is more connected than ever--a reality also driven home by this slowly abating recession with global reach--which leads me to my fourth point: uncertainty may be our new status quo. The economy has affected us all, but its real lessons come from the side effects it's imposed on many companies, such as a recent tendency for many to combat stagnant growth and low consumer confidence with expense reductions. They delay important decisions and long-term investments to avoid risk. Yet the best solution may be to embrace uncertainty and strive to grow through it. Thomas Edison is believed to have said, "Continue to perform while transforming." It was brilliant messaging on his part--and still so relevant today.
Of course, Edison also had undeniably innovative products to produce and market. And in truth, most think of my fifth point--innovation--as seismic change initiated by geniuses like Edison and the tech gurus of today. But in fact, nothing could be further from the truth.
There are many different types of innovation, as I discussed in my recent Huffington Post blog on the topic. And innovation can start small and be learned by any company. It may mean doing things a little differently, or leveraging assets that you already have at your disposal, from technology to servicing your existing customers with new efficiencies. For example, Nabisco took an incremental step when they created their 100-calorie Oreo packets for on-the-go, calorie-conscious snacking. And a staff program at Whole Foods to share performance results and successful methodologies across the entire organization has resulted in 'friendly' internal competitions and institutionalized innovation as all team members are constantly on the lookout for ways to improve their performance.
But ultimately, all five of these trends call for the constant vigilance Whole Foods staff has learned to embrace. Only then can we fully grasp their scope, significance, and impact, and use what we learn from them to our advantage to redefine our own realities and achieve sustainable profit growth.