It’s a time of unprecedented change. Our houses and careers aren’t sources of security anymore. The traditional job, for a lot of us, and for a lot of people in the future, is a dinosaur. And if you’re reading this, you’re probably interested in starting, growing, or saving your business, or one of several, and the path isn’t obvious, because a lot more has changed. There are three really significant areas that all new and all existing businesses must take into account. Even the mega-sectors of big food, big energy, and big pharm that have ransacked entire monopolized areas of the culture are starting to become aware of the changes that have taken place. It’s easier for you to use the information than it is for them.
1. Consumer interests became total: One of the great developments in the evolution of the consumer age is that there are enough choices with enough complexity that consumers now have the option to live more holistic, integrated lifestyles. Instead of having one or two of anything to choose from, they can get access to countless variations or instances of most products and services. Therefore, people are applying their matrix of social, political, creative, ethical, philosophical, and art and design attitudes to their selections from among the many competitive offerings. Ask someone why they choose a particular service and, where once they might have said, “well, there were 3 choices in the phone book, and I took the one with the biggest writing or that answered the phone first”, now they are liable to say, “I like how this company is changing the market, where they are ethically, their attitude toward design, and how they approach the world in general.” And they could be talking about Netflix, Patagonia, Zappos, Amazon, Tom’s Shoes, iHerb (or we can name a few dozen others off the top of our heads). New consumers aren’t just looking at the information exchanged by looking at each other (what you think is great about what you’re selling and whether they can use it) – they are also looking at the how you look out at the world together. How do you integrate into the total landscape of outlook, attitude, living and lifestyle? How well do you fit their lives? There are of course holdovers, for whom shoes are still just shoes, who don’t care about anything else, and they won’t care about anything but your sales material – but if that audience is your target, you’re competing on price – because they can get the same shoe, more or less, elsewhere. And commoditizing your product or service (it applies equally to both) isn’t the way to profitability in an age of abundance and maximum options.
Sure, people care about quality as well as price, but two things have changed there, too. 1. Quality is a discussion – it has become part of the total social expression of and livable reality in one’s life. Just ask the maker’s of Van’s shoes or North Face clothing – or of course anyone can point to Apple. Quality, in short, is part of an overall lifestyle choice that is part of a larger dialogue among consumers (and with some key innovative businesses) about lifestyle itself – not just about some austere value like sturdiness in particular – a dialogue in which you are either involved or not involved. 2. Quality is no longer part of a binary equation pitting price against quality and either balancing the two or shifting the balance to produce either luxury or economy products and services. Quality is part of a larger perceived discussion about design, about how design and objects d’art fit into one’s daily life and one’s personal statement about the self, and therefore one’s personal philosophy, and now one’s ethos. Now we really must cite Apple, of course, which has based much of its success on the recognition that people don’t want to shape their lives to a device as much as they want to buy design elements that integrate with and extend how they already live, which is partly based on their attitudes about the world. Workmanship now must take into account not just hand stitching but what the stitching is made of, and more than just whether it’s efficient and sturdy but whether it is aesthetically challenging in a way that translates directly to lifestyle. We keep using product examples, because they’re easiest, but the term “value added” in any service industry is expanded in the same way that “quality” is in product design, manufacture and marketing.
Again, not only design has changed, and not only manufacturing, but marketing also. Price and quality aren’t the whole thing any more, consumers are more savvy and have more options, and there are more kinds of consumers now who aren’t boiling it down to a simple equation – there are more criteria, and those criteria are largely about lifestyle, attitude, and outlook, about the self and about the world. That’s the kind of discussion therefore occurring in company blogs and social media venues from the most agile, cutting edge, responsive companies out there, and some of those most highly profitable and fastest growing ones. They are no longer message-neutral or value-neutral. They are blogging, tweeting, and creating an image out of of discussing life, lifestyle, attitude, outlook, the self, and the world. A result is that blog content is focused more on looking outward at the world, not inward toward one’s own organization.
Life, lifestyle, attitude, outlook, the self, and the world are the topics, and inevitably these aren’t value neutral, so the discussion involves some sense of values, philosophy, and company ethos as ethos in and about the world itself, not just about internals. Companies with no ethos, or only an internal one that doesn’t touch the outside world or that don’t talk about anything of relevance to that world, are ultimately being Walmartized, commoditized, and having to compete solely on price vs. pointless (luxurious) quality for a shrinking audience of binary-minded consumers. Where is the traditional luxury car, otherwise known as “the boat”? It’s dead. Why, because people don’t like well made things? On the contrary – it’s because it doesn’t say anything about the world that consumers are interested in anymore – not in enough numbers – it doesn’t integrate with their lifestyles, values, outlooks and attitudes. Even in the new luxury arena, a Lexus isn’t looking much different than a Mazda, so a lot of wallets are shrugging where there’s no ethos differentiator.
When there were fewer products and services on the market, or less access to them because people were limited to local venues within a few square miles – that is before the internet and supply chain economics), marketing was often the dispensing of price and quality data with a few gimmicks. You talked about the product or the service (endlessly parroting the “we offer this” and “we offer that” talk of bigger, dumber companies), and invariably (as you gained competitors who could replicate that product or service, reducing inherent differentiators) you went on about yourself as a company, what’s great about us, how our attitude is different. It looked a bit like a discussion of values, because you’d seem to say what your values were – “At Johnson Plumbing, We Believe the Client is First”. Then as more people did that, it became “At Jackson Plumbing, We REALLY Believe the Client is First”, and the jig was up. Pretty soon value discussion was as cheap as first liners in a singles bar. But it never was really value discussion anyway, because it was still not about the world – and values are always really about the world. Sure, OK, professional ad campaign firms did better than that stuff, but it still wasn’t a discussion, and the values were caricatures of values. It was about McEthos.
As their options grew, consumers showed they hated the fake value discussions by exercising the Walmart response in droves. They flocked to the big box stores and said, “look, if it’s going to be about bullshit, just tell me the price”. Some companies made the mistake, at that time, of deciding a company ethos really was bullshit and tried to compete solely on price and consumer loyalty. This actually *helped* the supply chain became ever more cheap and globalized, and smaller companies went under trying to compete with the huge supercenters. In short, they actually helped drive the cart leading to their own destruction. They lamented the death of consumer “loyalty”, but loyalty doesn’t come out of simply repeating past behavior, because someone is always holding out a better deal. Loyalty comes from authentic shared values at a core level, when it happens at all – values in the sense of not accepting the world as it is, and insisting on a different way. Loyalty isn’t “You know Jack here, he’s the vacuum cleaner wizard – he always has the best prices and he’s a home town boy…” Loyalty is the stuff Patagonia gets. In my case it’s Google, Netflix, and Amazon, and I can communicate the ethos of any of them and why it’s important to me.
The recovery of profitable small business that has become, in many cases, big business, was the rediscovery of authentic values that we’ve been calling ethos – ethos as a discussion about the world. The rise of the ethical consumer, often parodied as the vegan soy non-fat whole earth naturally sweetened middle class affluent, was quickly understood as a real and lasting change – not merely a small subculture. The rise of Whole Foods, Sunflower Markets, and Trader Joes attests to this. Companies like the aforementioned Patagonia started becoming the norm for a growth model that built trust with consumers not by saying “you can trust us” in an age where it turns out most every industry has been harming us in some way – big food, big energy, big medicine – not “We’re reliable, trustworthy, and those are our values here at Super Mega Mart, where you’re number one!” That was all rightly seen as bullshit, even in the cases when it was true – bullshit because it didn’t take consumers seriously – it treated them like cattle to be herded by a few buzzwords instead of people with complex, fully human motivations. Companies like Patagonia addressed the underlying problems of the world, in a way people were interested in. Companies like that started talking about the environment, cruelty, ethical sourcing, etc. And of course, they became an icon.
2. Marketing ceased to be monologue: Another great development in consumer evolution and the market is the overthrow of monologue. It was a virtually one-way discussion before, and consumers took it back, insisting on a participatory model – a dialogue. Consumers also have their own ideas about ethos – about the world and about values. Big corporations that thought they could dictate these like they had everything else, or that thought they had the pulse of the culture down to a formula (like they once did, when commercials were a lot like sitcom programming – a catchy jingle, a little problem to be solved, a touch of sex, etc.), made embarrassing asses out of themselves engaging in monologues about what’s going on in the world. Especially when they didn’t take that language seriously (any more than the old buzzwords), and their business practices didn’t match their rhetoric, consumers reacted vehemently or with scorn or (worst of all) ridicule. And with a vast network infrastructure for communication and production of media available to the average consumer now, they let their voices be heard everywhere. They made youtube videos mocking companies, did twitter protests, used facebook to distribute the embarrassment nationwide or globally within seconds. Everyone was a publisher, reviewer, camera person, news reporter, and opinion maker. Companies that dismissed that sounded like Hilary Clinton dismissing Wikileaks as insignificant because they’re “a web site”. In short – these companies looked retarded. And in terms of the cultural demand, they were. In fact, some went so far as to use force – lawsuits, getting legislation passed – to stop people from registering domains like AcmeEnterprisesSucks.com – it became an absurd, dictatorial attempt to quell the very force of discussion they presumed to lead.
Companies that got it, though, ditched a century of indoctrination – just tossed it over their shoulder. What did they have to lose? They could go under doing the same old car lot song and dance about “we’re reliable, effective, and the customer is king”. They could go down in flames being value neutral and competing on price, while the supply chain kept pushing the binary quality-price equation against them, and big boxes just waited them out. They could make asses of themselves by trying to control the emerging web culture and social media and get destroyed by looking ridiculous and alienating their audience. Or they could do the counterintuitive thing, throw out the presumption that marketing is monologue, and engage their prospects in dialogue – make them intellectual and moral asset holders in the enterprise. Companies that did that found people weren’t responding to bland, valueless thinking or attitude about the world, because that’s not how they themselves lived. As with ideas, consumers were no longer looking to have products and services merely dispensed to them – they were looking to include companies, products, and lifestyle services (any service can become a lifestyle service) in their social circle as equals – as part of their lives and lifestyles. And they didn’t want bland, soulless ‘friends’ who had no thoughts or ideas on anything important to them, or who spent most of their time talking about themselves, whether corporate or personal friends. They wanted what real people want in friends – to look out and talk about or engage the world together. Did you see that episode of Walking Dead – isn’t that crying girl annoying? It needs to be more about zombies. What’s up with dark beer having to be heavy all the time, like oatmeal? Dude – I get sick of when the wheels on my mountain bike go squishy on gravel, but I’m holding out on new ones because my girlfriend pointed out they use slave labor to make that stuff in Bodegastan. Etcetera. Consumers voted to look outward with business or look elsewhere -to make it either part of lifestyle or not even part of their lives.
That’s when you saw companies learning to be counterintuitive about controlling the message and saying things in their forums like: You’re right, that video did suck, but we got you to laugh *at* it at least. We’re working on a cool one for late November though. Who do you think we should get for the next spokesperson? Well, you’re right she probably doesn’t represent our values as well as we’d like. So, someone a little more in tune with green technology, then, huh? Oh he’d be awesome – I’ll get that to our marketing director, Jeff, and see what he thinks. Send me your e-mail, and I’m sending you a case of our latest just as a thank you for the suggestion. You want the corporate swag t-shirt, too, or just the product? OK, well we want both your daughters to have T-shirts if you like the new ones that much – I’ll get the stuff for you and 2 shirts XS out by Fedex by Wed. Keep talking with us. Peace out.
A more recent example is “Oh yes we did!” – that’s Dominos pizza after admitting their pizza sucked and totally revamping it. The domain, by the way, was pizzaturnaround.com – Instead of protecting their image at all costs (people don’t care about your image, they care about their own – e.g. as people of taste and discernment), Dominos went counterintuitive, had the discussion with their clients, and threw out the old product altogether for a new one that addressed customer concerns. They turned their losses around. That’s like a beer company developing a new taste online through it’s blog channel, by crowdsourcing it to consumer discussion. Yes, beer companies have actually done that now, more than once – this isn’t some pie in the sky theory we’re talking about – this is how business is effectively operating now – which is why the new craft brewing industry emerged largely as savvy social media users who were first part of a connoisseur community. Only later did the big spirit makers start focusing on craft beers or trying to fake it by creating pseudo-craft labels. But the growth in that sector came from a community dialogue. And that leads to our next point:
3. Product and service development became communal: The crowd decided it would have a say in design and manufacturer, not just marketing. When we say product development also became social or a dialogue or communal, it’s where we actually get to switch from the notion of “products” as items you shove on your shelf or into your game console and talk about them as including services, things that you actually do for your clients and get paid for. Services are products too, now more than ever, and they go through the same product development cycle. That’s huge. The guys that say “all us estate attorneys or real estate appraisers do the same thing” are way out of step now – partly because it ain’t true – and partly because if it were true, you’re down to competing on price, which is why you get all those useless calls shopping you from the internet from a web site that sucks, because the approach doesn’t position your market differentiators with any real value added, because you haven’t actually differentiated enough in the first place. Consumers can now find 1500 plumbers in a metro area, or attorneys, or home inspectors or whatever, just like they can pairs of pants or office shredders, and you’re telling them yours is the same as everyone else’s. When it’s really the same as the other guy, then a service really is just a product, even if you dress it up with the old ‘fast, fair, friendly’ stuff and talk about what you believe in, like a politician. That only leaves price shopping you – what do we expect? Same isn’t good enough when there are enough options, in services or anything else – it’s a losing game and a slow starvation. And the principles of marketing new products apply equally to services – not only does it need to be different – it needs to not be neutral – and it needs to take into account a discussion with your potential market on equal footing that you either are or are not currently having. If not, you have to find a way to engage them in meaningful dialogue. What other companies have found is that it’s by ditching the value neutral message and starting to engage the world itself, not just talk about your company or the services themselves, but what do your services really imply about the world? What do you want them to imply? If you don’t have an ethos, then asking questions, expressing desires, hopes, wishes is the pathway to developing one – to finding your communal voice within and together with your market.
Crowdsourcing – the practice of turning a problem over to the general public or a specific market segment to solve – is an acknowledgment that the community is really involved in defining or redefining your service now, or your product. Companies that only take polls and hire marketing research firms aren’t engaged in the kind of ground level, real life discussion that gives a full picture of what modern consumers want. They’re getting the aerial view, but they’re not hearing it friend to friend. And that barrier between consumer and the development or enhancement or refinement of your product or service is its death knell as “market segments” become increasingly agile communities with excellent internal lines of communication (via social media) an unlimited capacity for expression (blogs, youtube, consumer reviews), and vast options for obtaining services (supply chain economics, search engines, online and mobile everything, etc). Think about how Netflix blew it, repeatedly, in recent months. We get their core ethos, and how they’re trying to get everything into streaming format, and need revenue to push it. I’m not one of those who hated the price increase. But the back and forth with separating their service lines was a fiasco, and the overall problem is that management is making decisions without crowdsourcing – they’re failing to consider their market part of the decision-making apparatus in the company – and that’s deadly now. The market simply will not be dictated to. It won’t put up with it. So far, their blog (as an example) is just too distant, sterile, and commercial.
Perceptive companies now are not engaged not in simply creating something they hope will sell (build and pray), or paying a firm for market research and trusting that implicitly (numbers tell all), let alone trusting in their executive expertise (the marketing and business books are too often written by other people who don’t get it, and make it all sound like yet another arena for manipulation). Rather, they’re working on either becoming fully embedded in an existing or emerging community or else helping to create the community they hope will accept them as an equal partner in furthering some life goal or vision of the world. Examples of that in the skateboard and surfboard communities abound. The successful companies there have not come in from outside and said “Here is a product backed up by thousands of billable hours of market research and everything we learned in business school. Enjoy. Make us rich.” Instead, they come from within the community, or they build meaningful bridges between communities, and involve the people they’re trying to reach in the discussion about the needs of those communities. What they value, what their goals are, what they’re trying to accomplish, and the larger implications, and how those integrate into a the whole person’s integrated lifestyle, are core business conversations, minus all the traditional business trappings. The transformation from a few market segments, as though consumers were individually separated silos (joined only by their recognition, acknowledgment, and servicing by corporations) into more integrated lifestyles, loosely federated into overlapping communities, with powerful and effective independently operated media and communications networks of their own, has doomed the old product (and service) development cycle forever. Unless catastrophe sends us back to the stone age, and we’re lucky just to find hot soup, or some entity manages to drug us all into Matrix-like docility, this change is here to stay. The 20th century was a time of hunter-gatherer consumer opportunism – seize what you can find. In the 21st century, you can find anything and have it on your doorstep the next day, even if it’s in Tanzania. And so now, companies compete not just to get our attention but to be included in our conversation or how we’re living, and eventually to be allowed to contribute to it.
Services and products exist not so much on their own anymore as at the behest of the consumer, who either helps shape or helps reject them, who determines the bulk of communication about them not from a centralized corporate media outlet but from a gazillion points in overlapping networks of other people in a position to directly affect perception. This is why the product development cycle (again including services) is no longer linear – a straight line from development on through to marketing. Now it’s a cycle, of continual return to innovation, invention (reinvention) – it’s a continual repeat of startup mode. Successful companies in the new millieu stay agile (more like project teams, less like traditional, static corporate teams), continually stay connected to the external audience of key influencers of the product or service and contributers to refinement of the message, leading to integration into a community rather than sitting above it or above the consumer, and a constant return to innovation – remaining very much in that startup culture that has supplanted so many stodgy corporations. Those corps felt secure, until the changes in society that occurred with people’s independent access to vast information, media production capabilities, and communications resources – following on the heels of a sophisticated global supply chain and a culmination of consumer interests as total lifestyle components involving ethics and other attitudes. New companies stay new, if they want to be successful, and they do it precisely by being integrated with a larger cultural movement that evolves and changes, but is still going somewhere specific over time. The company is not the pinnacle anymore – the tribe is, to borrow Seth Godin’s metaphor. In exchange for adding value to such a movement, they get to become a member of the tribe.
Stop into a BMX bike shop and ask some real BMXers who they admire in the way of companies, and they’ll actually have an answer, and be able to convey reasons that relate to core attitudes and values. Companies are admired now, by their communities, not simply dealt with out of necessity or because they were in the yellow pages. Every other lead now is more like a referral, even when it’s based on interacting with something you’ve done in the public eye or said online – it’s a conversation, not just a pipeline. The era of the Sears and Roebuck catalog has not been simply replaced by the internet, like some phone book of business web sites, each of which is an ad. The change is exponentially more multi-faceted. Instead of a 3 sentence blurb but with more space now, we’re in the arena of meaning, and product or services or companies have to actually matter in some way in order to thrive.
One of the questions I often get as a business developer and web producer is: why should companies blog (the core social media form) and, by extension, get involved in other social media like Twitter, Facebook, and Youtube? The easiest way to express it is these three principles that reflect what has really changed in business development itself, in marketing, and in the cycle of innovation.
- Consumer interests became total.
- Marketing ceased to be monologue.
- Product and service development became communal.
You can do the old type of business, and companies will continue to do it for some time. But it will drop off industry by industry as someone in each field discovers how to really integrate with their community and with holistic lifestyle choices by an incredibly sophisticated (informed, communicative, networked and connected) consumer market.
This is an incredible opportunity for startups and small businesses, especially those appealing not just to other individual consumers, but whose clientelle are other startups and small businesses. There’s an ongoing dialogue already, a community already developing and evolving, that a lot of larger competitors cannot successfully be a part of, unless they change significantly. It involves lean business (including new spaces for work – like coworking) – taking what you need without having a mortgage on what you don’t, new team dynamics and new work culture (levelling the hierarchy – where years in the same role aren’t automatic entitlements, but contributing at a high level and generating new ideas, partly by distilling the input of consumers, is the primary currency of respect) in which titles are sometimes half-hearted tongue-in cheek items (just look at the fun ones on LinkedIn for some of the new companies – “chief brainstorm provocateur”), agility in project management (new kinds of communication, for instance – tweeting is the fastest growing project management tool – business is mirroring the larger social community), and nothing short of the formation of a new work culture with a newly emerging ethos.
In short, regardless of the line of work you’re in, or aspire to be, there’s a growing network of collaborators and community of like souls who are seeking together what ultimately amounts to a new society, a redefinition of work, and the empowerment of companies willing to change in ways that many of us feel are more genuine, constructive, and conducive to work as the most meaningful part of life. The revolution in business is a revolution in work, and it is happening at exactly the right time, as jobs are scarce (work is still plentiful), collaboration is at an all time high (it’s almost an artist’s rennaissance in small business culture now), and people seeking ways to not go back to the same old dependencies on corporate provision for a single income stream, career, and lifetime security and benefits (which haven’t been reliable for a couple of decades now and are never coming back). It’s an exciting time to be in business We get to be more authentic, more human, more involved with one another than the last 30 years have conditioned us to expect. Anyone now can start a business and utilize expandable cloud servers, outsourcing, global supply chain services, and professional space in the same way that anyone can produce TV or radio on the net, or start writing and build an audience. Our interest is always work as a source of meaning, whether that’s bettering society or ourselves. We think all these developments are lovely and hold vast promise for precisely that potential.
Addendum:
A recent question was why do we include author names, comment capability, and post dates on business blogs. The short answers, having mentioned the things above, are:
- Author Name(s) – because the new market wants to connect with, “friend”, include in their network, and engage with actual people, for the simple reason that actual people are the repository of real values, of an ethos. The impersonal, vanilla, corporate entity that consumes and conceals all trace of personality, verve, idiosyncracy, or attitude is falling away into oblivion. This is illustrated by the death of white label branding brought on by the failure of big corporations to create alternative social media venues under their own control, and the new open (read shameless and unembarrassed) collaboration of web 2.0 companies (that often feature the logos of the brands they use right on their home page). By ditching control as a primary need, and the appearance of dominating the entire supply chain as a cultural insecurity, smaller companies exuded authenticity and created authentic relationships. In a blog, this means using your name. You are, ultimately, your first and most important brand. Companies that still don’t get it are trying to squash what employees can say in online in social media – it’s retarded. They don’t get that it’s OK now, more than OK. Anyway, read the blog at Tom’s Shoes. Do you or do you not get a strong sense of personality? What about from the writers of Patagonia’s blog?
- Comment Capability – should now be obvious – it’s not a monologue – how do you know if what you’re saying is resonating with the community you want to reach and how do you plan to include them in your thinking to keep enhancing your message and service offerings which, if your marketing sounds like the old song and dance, “we are constantly striving for perfection…”, is going to take a hit. But we’ll add just one more reason: if you can interest a potential client – really interest them enough to engage you, they’ll help you interest someone else. There’s a reason the biggest predictor of a “tweet” (a post) on Twitter being re-tweeted (shared) is when someone re-tweets it: being authentically liked is going to introduce you to others who also like you. The more people engage, the more people engage, if it’s real. At a party, the conversations that attract the most participation are the ones that start attracting some participation. In the meantime, by keeping the comments open, you don’t seem shrill by having a one-sided conversation no one can respond to. Tip: Don’t think treating people like commodities and paying people to comment (some companies look ridiculous after doing that) will get you anywhere – it just doesn’t work.
- Post Dates – because a dialogue is ongoing, even if it isn’t always with the same people. Not every post will get a response (and in the beginning, it’s likely none of them will – unless you do a strong job of engaging the community where it already is, not expecting it to come to your web site just because you are there). But if the information is static, it’s not a discussion, and it’s more like a flyer from the old Mad Men era than the respect that includes your community in your thinking, and makes it obvious you do. It’s more like the final word, and hence a monologue, than like the thoughts of someone whose ethos and offerings are constantly developing, and for whom “quality” is not a buzzword meaning merely the routine workmanship or processes invested in something, but is in fact the attributes of a thing, for which an extended discussion is possible in terms of what those attributes imply for the world as a whole and for the consumer as a person integrating those attributes into a lifestyle. Dates – because your friends aren’t people who rarely call or who leave two-week old food and month-old roses out for you – friends keep engaging. Dates – because if you’ve run out of things to say, you’ve run out of relevance, and the count of weeks since your last post is also numbering your days before someone else who is more fun or interesting or just consistent becomes your market’s new best friend.
