Start Up Blog

Soundbites from the Future – 2013

Posted in entrepreneurship by Steve Sammartino on April 29, 2013

Recently I’ve been lucky enough to attend a few events which have been centered around what’s next socially and commercially. So I thought I might pull all these thoughts together in a new edition of Soundbites from the Future – The 2013 edition. You’ll find it is full of contradictions and juxtapositions. A bit like our emerging and likely to be permanent business environment. Enjoy!

The Co-Commerce Revolution – Well it isn’t really a revolution, more of a devolution. But it’s here to stay and is about to replace the 200 year anomaly of the industrial era. An era defined and dominated by the few who could afford the factories, the media and the distribution systems. The top down era of one size fits all. And now it is over. It doesn’t fit anyone anymore and anyone trying to sell it will end up with their friends Kodak, Blockbuster and Yellow pages. The co-commerce era is here and defined by the 3 C’s – Collaboration, Conversations and Creativity. Now that we all have access, everything is up for grabs. Just look at the new dominant platforms; they’re all egalitarian: Anymore can build an app for Play or iTunes, anyone can use Alibaba to get world class products made at the best prices globally in any category, anyone can advertise on Google adwords (highly relevant where 17% of searches have never been searched before) and anyone can build their own brand channel on Youtube. The revolution is about access and the democratization of the factors of production.

Counterintuition – When you are living through a revolution, it’s easy to forget that everything is above for grabs. That a certain industry method for success can be replaced in an instant. As we move from the industrial era to the digital one, we are even starting to see our new digital world be redefined. In fact, we can expect constant re-definitions of what we thought was right as a new maxim in the coming years. Let’s take on line retailing as an example. Why would a successful on line retailer open a bricks and mortar store? Or why would you open a store inside the store of a competitor? While this is exactly what on line clothing retailers Asos and Threadless have done. While Topshop have opened in Nordstrom. We need to have a close look at the worlds two biggest social media networks of Twitter and Facebook – they run open API’s for each other to assist their customers and suppliers switch and share between each other. In an old world industrial sense it’s a bit like Coke and Pepsi selling 6 packs with 3 cans of each brand. To survive in a world full of contradictions we need to think counter intuitively on purpose, not by accident or after we see it. We now live in an anarconomy where entrepreneurs are making counter moves to disrupt the status quo so they can redefine commercial landscapes. Startups are lucky that they can’t afford research, so they test in market and land upon on ideas that would never fly based on what we think or what focus groups would respond with. Which is the same reason why large incumbents would never happen up such radical formats – their system wont allow it.

The Maker Revolution – The factory isn’t dead, it has just shrunk a thousand fold and moved into our spare rooms and home office. It’s the next phase of D.I.Y: Do it yourself, Design it yourself, Distribute it yourself, 3D it yourself – in fact we can nearly make anything in home or certainly procure it via global production hubs like alibaba.com We can make anything because all the tools of production have been democratized for ever. We can now even access things that produce things with 3D printing. What this means for brands is simple but hard to grasp. brands need to be more virtual and conceptual because anyone with a $500 computer and wifi connection can make ‘it’ or, get the people to make ‘it’. This may be why the only consumer sector which is experiencing exponential growth is the luxury sector. Luxury is about the relationship people have with the thing, rather than what is being sold itself. It means luxury brands will have to ask important questions about what they sell in the future – will it be private jets, private hotels or access to something which cannot be made by anyone like experiences.

Technology Poverty – Every revolution has its downsides – those who miss out. Technology is bringing about a new form of poverty to those who don’t have equal access to it. Given technology is becoming the major form of market access – it should now be viewed in the same realm as access to medicine and education. It should be viewed this way because it has, and will increasingly have a direct impact on living standards. In developed markets Wifi and broadband are now seen as a right, rather than an option, to the point where many consumers claim that not having it is a modern form of social abuse. The technology minimums are changing quickly. Kids under the age of 15 barely know what a desktop computer is. While developing markets are jumping computers all together and taking themselves out of technology poverty and riding on the coat tails of the smart phone. The key risk for developed markets (countries) is that they don’t take the concept of technology poverty seriously enough. Sir Martin Sorrel, the founder of WPP (the worlds largest media organization), recently said he went to Tech Punta in Montevideo instead of the CES in Las Vegas. Here he found out that every kid in Uruguay is given a free laptop by the government – (for me it’s a bit like western countries giving all kids a free public education some 200 years ago and that’s why they currently lead the developed world). The entire country of Uruguay is connected to the web. Web access is seen by the government as an ‘economic development investment’, not a political football. They are using Singapore as their model of economic development.  He said the entrepreneurial attitude there is as strong as anywhere. A bit like Silicon Valley. The government is using the shift to technology economies as their chance to reinvent. He said that Western Europe is the most behind in the world at realizing this. They (Uruguay) want to ensure they are not a victim of technology poverty. It’s a pity Australian leaders don’t share the same view. The mind is empty when the belly is full.

The Big Data Brother -  The privacy issue around data is going to get much much bigger. Our personal data is being, bought, bartered and sold with every log in. What most people don’t know is that every click is traceable. And while we feel a bit uncomfortable, we still engage because the cost of non participation is currently higher than the price of privacy. This might just change. Most of the world hasn’t realized the depth of the issue yet. It’s much more than cookies and re-targetting. But so far it seems like an ‘opt-out’ approach is unrealistic as digital infrastructure is too important to our mode of living. The big issues in privacy will be geo-tracking, private preference, biometric scanning and medical history & prediction. If there is a resolution to this issue it will need to be simplified and philosophical with a pan global, United Nations style approach. Like most politically important information, consumers will eventually get to be in control of their own aggregated data. Some now predict there will eventually be startups that produce some kind of a digital vault and we’ll get to choose whom to release data to. The final question is what happens to our data when we die? Our social and digital footprint will be our record and our personal biography, so will our children get the rights to it? Who gets to own the digital products we have purchased in good faith? Actor Bruce Willis asked the same question late last year.

Retro Coping – Technology is being married up with memories as a kind of coping mechanism. The pace of change is so quick it is creating an anxiety to keep up. It’s not surprising that services like instagram and the i-cade gaming console are so popular – they re-imagine the new world with a sense of comfort from yesteryear. Footwear brands Nike, Adidas, Converse and Tiger have all done very well bringing back designs from the 1980′s to leverage the trend. While collectors now use on-line forums and new technology to re-live their youth. My favourite example is collectors weekly. We can only expect an increase in retro stylings as things move faster and we protest with our dollar votes.

Symboitic Branding – Co-branding used to be a parasitic relationship, the elephant and the flee, but now we are seeing true symbiosis due to the beta mindsets and startup culture. Instead of powerful conglomerates rubbing each others backs we are seeing small brands building their own ecosystem. Symbiosos being a situation were the interaction of two organisms (businesses in this case) are better off post interaction than if they did not interact. A big area for this is the redefinition of resource allocation. A more efficient allocation of resources made possible by the digital connection economy. The re-allocation of money, the re-allocation of time, and the re-allocation of space are three key areas for this.

Crowd Funding – Is another great exemplar of the big end in town being disrupted. While non bank business financing is currently miniscule by comparison, the numbers from kickstarter.com tell us something is brewing. Since it launched in 2009 it has funded 86,000 startups and raised well over $400,000,000. It’s now clear who is in control when we can create the products (world?) we want by voting with as little as $1. With changes afoot in the USA with the JumpStart legislation the legal barriers to non traditional funding and banking are being reduced further. Add micro payments services like Square to the equation and very soon we will begin to hear investment bankers start to cry foul like journalists and recording industry executives have been doing since Napster.

Space Squatting – Newer brands are understand that space and time are assets which can be leveraged via digital location and time specific connection. In today’s world people know that access is greater than ownership. People chase experience and utility more than they do accumulation. The art of activating idle assets to bring in new revenue is occurring for both the service provider and the service creator. If we consider the heroes of the collaborative consumption movement like Airbnb, Zipcar and Uber then it’s easy to see what they have in common: activating down time for assets and long tail efficiency. The future will be more about leased living as the friction in doing so is reduced by mobile computing, instant knowledge of availability, and social / digital ratification of participants. Other forms of space squatting have included strange combinations like mobile food truck of Johnny Cupcakes & Junk Food Clothing. Or in London the Menzies Pie shop (which doesn’t open in the evening) converts into a night time restaurant called the Seagrass Restuarant. Same place, run by different people, at different times, with a different offer.

Brand Jacking – the process of brands hijacking each other for fun and on purpose can make for interesting viewing in a sea of boring. Especially when the brand normally operate in an invisible category like washing powder. Here’s a great example from the worlds oldest brand marketers, Proctor & Gamble: Old Spice brand jacks a Bounce commercial. More proof that innovation is an attitude and not dependent on which era you’re from.

Brandalism – When a brand continues to do the wrong thing by their consumers, the world, or the environment, then we can expect brandalism to emerge. The firm Arctic Ready did such a thing with their fake “Let’s Go” campaign which Brandalises Shell oil. This execution was actually presented in the board room by executives who thought it was a genuine advertisement by them. Another recent act of brandalism is the 14 year old McDonalds burger which doesn’t look more than 14 minutes old.

Popup-e-nomics – As retail continues to struggle as a permanent fixture, smart and nimble operators are leveraging events, seasonality and instant geo-located retail parties as we move into the popup-e-nomics era. Pop up retail is nothing more than a reinvention of the moving spice market mentality that was the birth place of modern retail. A few thousand years into the future and traders are moving back to the mobility retail model. Itinerant brands invent scarcity in the same way that live performances do. A local example was the Greenhouse pop up restaurant in Melbourne by Joost Baker – Which included vertical gardens and large amounts of material re-purposing. When things are mobile in their nature, it enforces sustainable design principals to be built into the outfit. Curiosity Retail will is also starting to emerge as a way remove price as a factor and create interest. Restaurants increasingly growing herbs and vegetables on site and doing something unique and curious in nature. Things worth a quick look at.

City Reclaiming – Residents in many cities are starting to react to poor representation by government for decades. They are now reclaiming their cities and circumventing the planning doctrine. Residents are collaborating to start, finance and manage public works projects and proving they can bootstrap a better job themselves. Some of the amazing examples include: I Make Rotterdam project, where local residents made a bridge the government wouldn’t fund, The big + swimming pool in New York’s Hudson river, and the New York high line reinvention. And one startup – Brickstarter – has decided to take it to the another level and design a system that allows communities to build their own sustainable and improvement projects.

A Move back to vertical living – Years ago we used to live above the store, or behind the craftsman’s workshop. Then the car and factory pushed us all apart. The highways linked us to our place of work with our home, and our media (Television) linked us to our perceived world. We lived in isolated silos of production, entertainment and consumption. Suburban living improved living standards, but standardised everything and everyone. It was anti-social in nature. Recent growth in digital social networks has served as a reminder on what differentiates our species. Our desire to collaborate and connect. Our cities became wide and lonely spaces with big boxes to buy stuff in. Cities are now becoming vertical again. Work and social life are being re-integrated. It’s ironic that the cost of transport (both time & financial) has brought us closer together again. And just like the past, many companies and startups are starting to do all the parts of their business themselves. Etsy as a classic example of a vertical business, where their entire community are all consumers, manufacturers, wholesalers and retailers.

Faction Marketing – After 50 years of invented pop culture and mass media force feeding, authenticity from brands was a boon for both parties. We rallied in the freshness of truth and justice in the marketing way. But the excitement of a simple authentic brand is waning somewhat. It was what marketing should have been in the first place. Being real was only radical, because the world before it was so opaque and fake. The net effect of all this, is that being authentic is now becoming a cost of entry, rather than a point of difference. The 3 T’s of Truth, Transparency and Trust are now expected. Brands get it now that real matters, but it wont be enough to hang their hat on going forward – our product must be authentic and fantastical.

Authenticity as a foundation – But some took authenticity a little too far. There is a difference between being deceptive (hiding or denying the facts) with simply showing too much. Reality is not always beautiful, and so long as what is underneath is valid then it is OK to put a bit of fantasy on top. Marketing both Fact and Fiction or – Faction Marketing. In this realm we can bundle authenticity into the convenience bucket and take it as a given. We can’t charge a premium for it today, it’s a simple part of brand economics. What people want goes deeper and has layers of interest added to the realness. People want to suspend disbelief, be part of trans media tales, co-create stories, be assisted in their personal mythology and self actualize. The silver screen has met the tiny screen. Our mobile is our new cinema and the content needs to match the context today. We are all creating our own story live. So do brands and so do the video forums we live on – like Youtube – whose annual review is really our annual review. It’s what we did, looked at and lived through.

Fantasy is back – We are suffering from austerity fatigue. In a post GFC environment it’s now ok to get into the fantasy space – so long as we obey two simple things. (1) Stay true at the base level and (2) increase the happiness of our community in the process. If a brand is a personality then we want it to be the kind of person we’d want to hang out with on a weekend. Just like our coffee, it’s ok to have a cappuccino because we know that there is espresso underneath the froth. We are starting to endear ourselves to the idea of Cappucino Brands. Some brands are starting to say what if we could transport ourselves and our community into a vastly different, if temporary world. Let’s take the faux startup Voosa as an example, it shows how bored we are of pure authenticity. Other examples include the Selfridges Yayoi Kusama Louis Vuitton display which was something that you just had to visit – it was live fantasy. We are even seeing fantasy dominate the box office with Life of Pi and even the living room screen with Game of Thrones. While one of my favorite portrayals of the fantasy worlds was the Prometheus movie trailer which featured a TED Talk from the year 2023 with the CEO from Weyland Industries… “We are the God’s now”.

What Department Stores Forgot – Fantasy and journey was the original promise of the department store when they first arrived in the early 1900′s. The department store was designed to bring the distant world to us. At that time and even until much more recently we could not afford to visit the world physically, and we certainly could not have it brought to us through virtual means. Ironically, this is ‘still’ the job of the department store now, it’s just they they forgot about fantasy and vicarious living – they got all caught up in price and foot traffic. Which happens to be the two platforms they can’t possibly compete with the web on now. Their stores need to be enclaves of the nether world, the place we’d really rather be on a Saturday, whether it’s an Arabian silk market or the feeling of New York’s 5th avenue. They need to start re-creating a new world in store and make what they sell fit into that temporary fantasy.

Surrealism Rising – Real and digital realms are converging in physical spaces. The ‘web invisible’ will be the new normal as our entire environment transforms separate spaces to an integrated word of seamless technology. We no longer go to technology devices but live on top of them and within them. Commodities are being replaced by art – and art is the only thing we can charge a premium for these days. Being capital and technology intensive it is not enough of a foundation to charge a premium. More brands are now playing in the ‘what if’ space. They have to as the new digital dominators are forcing all industry stalwarts to wonder how they will be disrupted. The startup ethic is catching on to even the oldest and slowest corporate monoliths. So we must now ask where will the story change… and ask the ‘What if’ questions seriously… maybe retailers should be asking these types of questions

  • What if our store banned all brands?
  • What if a retailer had no stock in the store?
  • What if phones were banned in store?
  • What if you had to share a photo to be allowed to buy something?
  • What if you had to book an appointment to visit the store?

Examples of Surrealism rising are many and varied. The Man on the Boon store is a curated store where the founder only stocks stuff he would buy or own. It’s “his” store. That’s the strategic alignment, not what is sold inside it, but rather stuff that he happens to like. In this case engagement doesn’t have to be our reality, it can even be the distorted one of the inventor. We might also consider the famous Japanese rock star Hatsuen Miku. Her concerts sell out, she has adoring fans, but she’s not real, she is a hologram…. ‘Anime’. Hard to believe until you see this. While Clouds over Cuba represents something more apocalyptic, it is still part of the ‘what if’ narrative. This movie revisits October 1962 during the Cuban missile crisis and what might have been. While Nuclear was avoided, this story is what the world would be like if the result was war. All these examples remind us as that we are the story telling species.

Instant Nostalgia – While the speed of changes continues to accelerate, nostalgia is being used as a coping mechanism. With instagram being the obvious example, others are bringing back bespoke craftsmanship and even ‘instant history’. Let’s take Facebook timeline – it’s smarter than most of us give it credit for. Brands are almost obliged to tell their story and give an historical account of how they got there. It’s something old consumer brands have more of than the new digital darlings – a long drawn out story. This forum gives them a license to tell it. A favourite example is old sporting club’s and Universities making their FB timeline a page feature and promotional item. Brands with long histories can tell stories with old creative executions in context and provide an evolutionary angle, rather than just ‘here’s an advert from 1983‘. The back story tells so much about the today story. On top of this we are hungry for certainty, and good memories, even if we weren’t there. We are more appreciative of the imperfections in life as we move into a more human era of marketing. Maybe it is the soft crackle of an LP record that has enabled vinyl LP sales to increase year on year for the past 19.

Inventing Language – A connected world is creating rapid fire change to the language we use as humans. It’s now evolving at the fastest pace in the history of the spoken word. While local dialects are at risk of extinction, new forms of mashed up global language are emerging. There is nothing stopping smart people and organisations from inventing their own parlance to fit within the over riding trend. Lady Gaga used this to terrific effect when she launched her fragrance ‘Fame’. The commercial people wanted to watch even though it runs for longer than 5 minutes. They invested their time in it. Lady Gaga tweeted the bottle pre release to tell her fans what it smells like;

…tears of belladonna, heart of crushed of tiger orchid, with a veil of black incense, pulverized apricot, and the combination of essence of saffron and honey drops…

Mars is the new Moon – it seems every second billionaire is launching a space exploration startup these days. This has rekindled the exploration nerve in the everyday earthling. While we now believe civilian space travel just might be possible we want a taste of it today – and I’m not just taking about moon boots or moon patrol. The worlds biggest sporting brand is even taking it on with their NIKE craft launch – pun clearly intended. By teaming up with designer Tom Sachs Nike have enabled a galactic design ethic with the Mars Yard Shoe and matching ensemble. The only rational desire is to want it.

Existence is optional – In a factional world something doesn’t even have to exist to be absolutely brilliant. The web 2.0 era has taught us to create on marginal platforms and ownership. We’ve stopped asking for permission. Consumers are now starting to create their own factional brand stories about themselves – from their social feeds, to their Youtube channels – their reality is what they say it is. People first made mashups, now they are becoming mashups. They are evolving into combinations of who they are and who they aspire to be – blurring digital and physical worlds make this both possible and simple. So the human pattern is now one of a story which is shared, told and changes as the journey is taken – live on line.

Blurring of worlds – My favorite blurring comes from the world of on line gaming. [which By the year 2017 on-line gaming (non gambling) is expected to be a $70 billion dollar industry] A particular game called Journey by That Gaming Company, has a hidden part of a game which only reveals itself once you’ve already played it…. As you play the game you learn about the characters and that you can get them to fly… But the only way to fly in this game is by holding hands with another character…. what you don’t know until after you’ve learned to fly in this game, is that the other character is another player doing the same thing ‘live’ – which means the only way you learn to fly in this game is simultaneously with another player. Both players are unaware the other player is not part of the game, but another person until after. The only way to get to the next level via flying is together. This game also requires players to sing at various times during it.

The New Sublimity – Consumers people are fed up with materialism. They are let down by consumption, and totally discombobulated with their digital lives. Conversation has overtaken contemplation. We can see this in the sublime spaces promoted on Airbnb. Or the Enrico Resguardo Silvestre Hotel in Baja California. At this hotel they espouse the somewhat revolutionary idea of sitting by the view instead of sitting by the screen. And brands too need to understand the power of being quiet or silent, instead of big and brash. Selfriges have done this nicely with their No Noise spaces. or it may be that you end up embracing Hobosim just like the entrepreneurs who founded the NYC Bivouac hotel – a space where people camp on the top of city buildings.

Digital Dieting - We are now moving into a post business meets leisure environment. Five years ago holiday location hotels promoted free wifi. Now it is Zenn disconnectedness. We now want to be uncontactable on holiday. Closed loop isloation is now becoming a form of luxury. The digital diet and going dark (2) will become a cultural imperative to save us from our devices. It wont be a counter trend, but more a realisation that there is a switch, and we can turn it off.

The Slow Web – Now that we are cleaning our minds with digital diets, sublimity tourism and quiet spaces, we fill the void with the emergence of the slow web. People will replace the junk food web – instantly gratifying bursts of data -  by investing larger amounts of time into human based insight – information with some serious nutritional value. Smart audiences are realising there’s very little value in knowing the latest meme and are responding with services like Long Reads. Which may just be where you’re reading this post.

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2 Responses

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  1. [...] Soundbites from the Future – 2013. [...]

  2. Hywel Curtis said, on May 3, 2013 at 10:03 pm

    Very interesting stuff and, thankfully, a lot of it chimes with my own musings on the near future – and I feel that this justifies my existence in the present so thanks for that!

    One thing that jumped out at me is that “Startups are lucky that they can’t afford research” – in this data-driven age that seems to be an odd way of looking at things, but its obvious so many times. This Quora page deals with a similar topic http://www.quora.com/What-were-the-most-ridiculous-startup-ideas-that-eventually-became-successful.

    Thanks for putting all these together though – now I have to get back to my anarconomic endeavours!


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