Inspiring the New World

This article maps some big shifts happening in society, with focus on Millennials and the upcoming generations, and discusses how these may affect the future of brand communication.

New World Business Order

The new world business order is ruled by companies that play from a different rule book.

Dollar Shave Club delivers razors to more than 330,000 subscribers on a monthly and bi-monthly basis. 73% of its members change their blades once a week, compared to 28% prior to joining.

This is an example of classic bottom-up disruptive innovation by a new entrant. It is very difficult for an established business to bring this type of one-off game changing innovation to a category.

Clothing company Uniqlo has grown by $6bn dollars in the past 8 years by selling basic clothing styles in a wide array of colors. Its brand is non-referential, selling no specific lifestyle. Its target consumer? Everyone. Simple. Breaks the rules. Their goal is to be Number 1.

The electric car company Tesla has a goal to be a world player in the automotive industry. It is also seeking to be the world’s low-cost producer in energy storage by commercializing battery packs. Its future is in transportation AND electricity production.

Lego, a company facing bankruptcy in the 1990s, has made a comeback by expanding into theme parks, gaming and robotics, and can even add #1 blockbuster movie to its list of ever expanding products. By transforming its business model and changing how it sees itself, Lego has been able to create sustained innovation that has completely transformed the company from a plastic brick manufacturer to a leader in youth culture.

Google started as a search engine in 1998. Now its data informs the Internet of Things, tracking things like energy consumption to how you shop and how we advertise online.
Its Android mobile operating system is the most popular in the world. It’s diversified into wearable technology with Google Glass, experimented with self-driving cars, has platforms for scholars, books, videos and maps. Estimated revenue this year from generating display ads? $2.31bn, up from $1.38bn in 2011. Constant and sustained innovation since Day One.

Winning companies in the Now are those that are constantly reframing what they do, how they do it, and what business they see themselves in. The future will not be defined by only the disruptors, but by those companies that can create meaning and scale through constant and sustained innovation over time that invents the future.

When Toyota launched its hybrid range in 1997, gas was cheaper than bottled water. General Motors called hybrid technology a “science project”, and Toyota admitted that at the time fuel efficiency wasn’t even part of the consideration set for consumers when selecting a vehicle.

Today, Toyota has sold more than 6 million hybrid cars, Prius is a pop culture icon, and Toyota is on track to make an annual profit that exceeds the combined 2013 earnings of General Motors, Ford and Chrysler. Toyota acted on a revelation they had about the consumer, and as a result, created a market for the future.

Asking the Right Questions About Innovation

In one minute add all the numbers from 1 to 100.

Gauss, the best mathematician that Germany ever produced, got the answer in 60 seconds in 1787 – when he was 10. Most people say that it’s impossible to solve in a minute. What Gauss said was that it is impossible to solve
approaching it in a standard way.

You do not want people questioning the goal or task. What you want them to question is the way they are trying to achieve the task. You want them to ask “How can I think about this differently?”

Questioning can lead to innovation, but it’s what you question that makes the difference. As leaders we need to continually set big stretchy goals and inspire people to bust through them.

New World Social Order

Millennials were the first to adopt new ways of shopping and new forms of communicating. They are a generation of pop-up shops, concept stores,
e-commerce and social currency. What used to be seen as “alternative”
methods are now mainstream.

In China, 80% of all online purchases are done on Alibaba, China’s online
retailer. On November 11 last year, China’s biggest shopping holiday,
Alibaba had sales topping $3.1bn.That’s more spent in 24 hours than Americans spent online on Black Friday and Cyber Monday combined.

Amazon’s move into the grocery aisle has forced Walmart to rethink its long-term strategy. Amazon’s partnership with smaller stores like 7-Eleven, combined with investments to enable same-day-delivery, mean that shoppers will become more comfortable ordering supermarket staples from an online warehouse. Amazon’s fourth quarter revenue? More than $21bn.

Smartphones are becoming more integral to the path to purchase. They were used as part of the shopping journey in $29bn worth of store sales, up 45% on 2012. As a matter of fact, 4% of Americans have admitted to making a purchase on their smartphone while at a social gathering!

These are growing norms in a new world order where:

Millennials in the developed world don’t want to drive

Fewer young people are driving, owning cars and even getting their driver’s license than any generation since the beginning of the automobile. In New Zealand’s capital city, the number of licensed drivers aged 16 to 19 has fallen 75% in 5 years.

Teens think cars cost too much, they’re worried they might drive into someone, they can catch public transport, connect on social media, or they just can’t be bothered sitting their license.

Coca-Cola is losing its fizz

Coca-Cola has thrived for 127 years but the brand is becoming less relevant. Slowing growth in emerging markets has resulted in a $1bn cost cutting program. Fourth quarter net income slid more than 8%. Last year in New York, sales of Poland Spring bottled water overtook Coca-Cola.

The average age of a Coke drinker is 56. Older people think themselves young when they drink it, while young people seek alternatives like energy drinks which are more reflective of their “on-the-go” lifestyle.

The brand that defined ‘modern’ branding has aged with its core consumer base, leaving Millennials questioning its relevance.

Sharing, collaboration and community drives success

The Sharing Economy finds new ways to maximize the value people get out of the things they own, while giving them a chance to be part of a larger community.

This generation chooses authentic experiences by skipping hotels and vacationing in other peoples’ homes through platforms like Airbnb. The company has served more than 9 million customers and grew its bookings 73 times in the last 3 years.

Consistent with their dislike of owning cars, Millennials are using car-sharing services like Uber and Zipcar to get around. These two brands serve the high and low-end spectrum of the market, with Uber becoming a status symbol for the more affluent, tech-savvy demographic.

And it is not just products and services that encompass the Sharing Economy. Millennials want to share their ideas with companies. 60% provide feedback on products and services, upload videos, images and post blog entries online. Co-creation and collaboration provides feelings of inclusiveness and ownership.

Single and child-free: emerging demographics?

51 countries, including Germany, Italy and Japan, will have lower populations in 2050 than they do now. By 2025, deaths will likely exceed births in the developed countries, the first time this will have happened in history.

There are freakish phenomena such as ‘the flight from human intimacy’. In Japan there is a ‘celibacy syndrome’. In a survey, 90% of Japan’s young women believe that staying single is preferable. 45% of women were “not interested in or despised sexual contact”. 25% of men voiced the same opinion.

Looking at the US, in 1992, a Wharton School professor undertook a survey of graduating students and found a solid majority – 78% – planned to have children. He repeated the survey in 2012. In just 20 years, that rate has dropped to 42%. Indicative of the wider trends we’re seeing in just how different the Millennials view their lives.

Introducing Generation Z

In a study undertaken by Saatchi & Saatchi, we looked at Generation Z in the developed world to give us hints as to what kind of parents they might be. The study found that:

#1: Adulthood is moving younger

Flynn McGarry (above, right) is a 15 year old chef. He serves a 12 course meal for 40 people for $160 per person at a Beverly Hills restaurant and has a NBC television show in the works.
10-11 year olds are taking on adult behaviors and accomplishing ‘mastery’ at a young age. Childhood is being eclipsed by a determination to grow up and be taken seriously. Life is about racking up and cataloguing achievements for their virtual CV.

#2: Identity is designed, not discovered

A recent Pew study reported that 81% of Millennials are on Facebook and their median friend count is 250. 55% have posted a “selfie” on a social media site and are more likely than any other generation to do this.

High school has advanced. Identity isn’t discovered. It’s created. And it’s not just about the individual. It’s about creating their brand within the context of the friend group, a group no longer geographically constrained. Teenagers are choosing their fit. Choosing how they want to be positioned and perceived by their digital audience.

#3: Doing trumps owning

Millennials are shifting their concern away from the material to the experiential. Teens are searching for experiences. From ‘do you have?’ to ‘did you go?’, ‘have you been?’ and ‘did you see?’ This is the ultimate social currency.

#4: Sustainability isn’t a thing, it’s a way

Millennials are considered “born green”. Their parents belonged to a generation that founded the environmental movement and introduced words like “organic” and “biodegradable” into mainstream conversation. Sustainability is a determining factor in what they buy and where they work.

64% of North Americans will pay extra for products and services that are from socially-conscious companies. 74% of Millennials in emerging economies list sustainability as one of the determining factors of where they choose to work.

#5: Technology is rewiring their brains

Teenagers form connectivity with devices, more than with other people. They were born with a mouse in their hand and an umbilical cord plugged into the Web. Online interaction is first nature. Face-to-face takes a back seat.

In a study by the University of Minnesota, Millennials were shown to have high rates of digital dexterity and better multi-tasking capability, but score low on their ability to pick up on non-verbal cues and read facial expressions – something non-screenagers have as second nature.

For girls, technology is a buffer from contact from boys. They seek emotional connections where they feel most comfortable. Online. What if the majority of today’s teenage girls, have little or no interest in having babies?

Will demographics and cultural attitude shifts be the disrupters of Pampers the way Amazon is disrupting Walmart and energy drinks and water are disrupting Coke?

Winning Thought-Starters

Here are some thought-starters for how we might think about the future of brand communications over the next decade to win the moments of truth, starting from tomorrow.

#1 Ignite the Desire for Family

We’ll never take our eye off product benefits and performance. That’s a story to be continually told. Parallel to this, we need to think about creating the desire for family. A different form perhaps, but one that supports and fosters procreation as good.

We already know that Millennials have an innate sense of community. They are not drawn together by religious beliefs or political views, but spend time with friends online and congregate around shared interest. What if we use this as a springboard to make them see that having a family – in all its dimensions – will enrich their sense of community? Will enrich their lives?

#2 Win With Co-Creation, Collaboration and Creativity

Millennials believe that when it comes to selecting the best ideas, the group will outsmart the individual. Platforms like NikeID, Kickstarter and Etsy have
already shown that co-creation transaction models can succeed.

Why not get consumers to be ‘co-conspirators’ in services and product lines? Encourage current and future customers to get involved in communications? Tap into collaborative problem solving from issues varying from design to sustainability? We already know that Millennials want individuality, recognition and community. What if we created sustained innovation by giving the consumer more opportunities to be a part of the growth of Pampers?

#3 Seize the Moment and Live in the Now

Creating brand experiences in the moment that touch people’s hearts and inspire them to share is a great way to think about how best to communicate.

Live in the moment. Create momentum through moments.

During the Super Bowl, Tide opted out of broadcasting the traditional TVC and decided to be part of the conversation happening online. During the game, Tide published 23 Vine tweets that were tied to commercials being shown during the game and as a result, generated 1,174% more engagement than their daily average.

Dreft sponsored the birth of Kevin Jonas’ daughter; he made tweets to his
4.2 million followers. Who does that?

The demographic for future and expectant parents belongs to a generation that thrives on Connection, Community, Creation and Curation. They live their lives online and are introducing their children to technology at an early age.
This is about embracing the Now, and helping them create memories that will last for a lifetime. There are many cultural and demographic challenges ahead. We need to leverage off life as we see it, not only what matters to our consumers, but where we want to lead them. We need to move from “What does my ad look like?” to “What does love look like?”

If we’re going to inspire Millennials to undertake the greatest journey in life we need to be able to connect with them on their level. We need to educate them that the greatest experience in life, is love itself, and the greatest expression of this is family.

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