Just how do companies deal with the deluge of technological change that’s affecting everything from traditional business models to brand identity? NBF correspondent Jan Turner reports on some of the ‘blue sky solutions’ presented to members of the European Bedding Industry Association (EBIA) by Tom De Ruyck – a managing partner of international marketing research agency InSites Consulting – at the group’s recent annual general assembly, and what they mean for the UK bedding industry …
We live in a tsunami of technological change – a world where the pace of progress has become so breathtakingly fast that companies around the globe are struggling to keep up.
Part of the reason for this is that while technical innovations are coming at us in droves – and from all directions – too many businesses are still making decisions in a more linear way.
According to Tom De Ruyck, addressing an audience of European bedmakers and suppliers including many NBF members, it may be scary stuff - but it also makes for some of the most exciting times we have ever seen.
“Technologies come at us at a speed we can’t handle, and that, along with the sometimes extreme expectations of consumers, has put some companies’ brands and business models in depression,” he says.
And as Jack Welch (former chairman and CEO of General Electric) famously warned: “If the rate of change on the outside exceeds the rate inside, then the end is near.”
Since 2006 we have seen the explosion of social media, smartphones, smart cars, and smart computers. So just how do companies make the change and adjustments needed to keep up with both technology and increasingly demanding consumers?
According to Tom, it’s all down to purpose, relevance and innovation. “We’re seeing consumers move from wanting a ‘promise’ from a company to wanting a ‘purpose’,” he says.
“The truth is the average consumer only really cares about five brands. What they want today is: great product service; for companies to demonstrate an emotional bond with their customer base; and societal impact. This has become more important than ever before, especially among millennials. Brands need to be asking themselves Why am I here? What is my purpose in society?”
Unilever has said that by 2020 all brands must be ‘purpose’ driven, and they’ve started with the OMO laundry brand, a good functional product which has been brought back to life with a dash of purpose and societal impact.
The company set out to give young mums and dads a way to connect with each other and share their experiences of raising children. Research showed its marketeers that urban areas often had no space for youngsters to play outside – a real negative for developing their social skills.
As a result, the laundry brand has started building playgrounds around the UK, so offering a connection with its audience and a purpose for the world. The move has not only attracted new customers but also talented new people to the business.
The same kinds of opportunities exist for the UK bedding industry. As Tom points out: “You guys have one of the most important products in people’s lives. It may not always be aspirational, but with young people, health is important. Five years ago, that was about sport and food, but now people are spending more time and money looking for the right sleeping products – so look at that trend and leverage it.
“Do you want to do it alone, or do you want to work together to fight against all those other companies selling sleep?”
Too many companies in general, he says, have illusions of longevity. But where once a business model would last forever, or was good for at least 60 years, just two years ago it was reckoned to be 15 years. Today it is an alarming 12 years.
“Our attention span is small – among young people it is now just 2.5 seconds,” says Tom. “We are bombarded with advertising messages, and people start to become immune to different messages and build a wall around themselves. So if you want to stand out, then you have to connect with them, which means understanding them and speaking their language, or they won’t pay attention.”
And there are plenty of examples to demonstrate the ways in which this can be done – to both positive and negative effect.
One fashion retailer with a door policy which implied ‘if you’re not beautiful enough you don’t fit the brand’ may well have nailed its brand identifications but – perhaps not surprisingly –in the past three years neither the company nor the brand has been doing well.
Despite its current issues in London, Uber has also been hugely successful around the world. At the end of the day, it may only be a simple app in terms of technology, but what the company has done is make that small piece of technology hyper relevant for people who use taxis. Waiting for and paying for them are consumers’ two biggest frustrations, and Uber eliminates these concerns, leaving people feeling that they have been genuinely helped.
It’s about creating a personalised experience, too. Take the ‘Push for Pizza’ app – signing up involves providing information about your favourite pizza (nine times out of 10, people order the same one), your delivery address and payment details. Once completed, ordering a pizza is simplicity itself – people only have to push one button, and 30 minutes later it arrives at the door, all paid for.
As Tom points out, the success of this business model is down to the fact we’re humans, we’re lazy, and our brains want to do as little work as possible!
He says heightened – even extreme – consumer expectation needs tackling by integrating purpose and innovation into business strategy.
Differentiation and a personalised experience are key. As Steve Jobs once pointed out: “A lot of times, people don’t know what they want until you show it to them.” So far, however, the shift in emphasis towards marketing a product or service’s ‘relevance’ rather than its benefits and features, has left many brands struggling.
“People are not loyal to brands any more,” says Tom, “especially millennials, who are loyal to experience. A great example is Spotify – young people talk about the great experience, not the brand.
“Today, it’s all about making the move from ‘marketing to consumers’ to ‘mattering to people’. How can we be part of their lives and have meaning and relevance to them? What is the balance?
“With beds, perhaps manufacturers need to be asking themselves how sleeping well in a good bed at night can translate into benefits during the day. It’s about thinking more broadly about people’s lives.”
Other brands in the sleep arena are already muscling in on the momentum – Panasonic’s Sleepwise being just one of them, promising people a longer and better night’s sleep which allows them to wake up refreshed in the morning. That’s because the company has recognised that in the West, there is a real need to be an energised, happy, smiling person, rather than one who is tired and grumpy.
“Chinese people say they want a great night’s sleep because they want to be a nice person – but if you go into their head it’s because they want to be the best person at work and get the top job,” explains Tom.
“The ‘need’ is sometimes different to the ‘want’, so it’s about examining the need that is really behind people’s desire for a good night’s sleep. That may be different things in different countries, and the market needs to examine what counts in their domain and promote the solutions.
“It’s about putting yourself in their shoes. People in marketing are more connected and better educated than ever before – but never think of things like other consumers.”
At one Belgian lingerie company, at least half of the company’s staff are not its typical consumers, so its bosses launched an International E Cup Day for Men. The idea was to show the male workforce how it really felt to wear a bra. It made them realise the difficulties and importance of support.
Lego similarly took a ‘child’s-eye view’ of its business to combat falling sales at one point. As well as research with children, the company organised days where children were taken into work, and designed meeting rooms with extra-large chairs, so the staff themselves felt like children.
Says Tom: “It’s about relevance and connecting with the customer – so talk to the customer and work with them. Otherwise you could be missing out on a lot of opportunities. Start collaborating, working together with consumers. And listening.
“It’s also about speed and fast implementation – and consumers can help you with both.”
Not to do so can end in the kind of disaster which felled the Kodak brand. The company thought it was smarter than the trends and ignored digital because they thought of themselves as a chemical company. “They could have been Instagram but they did not keep their eyes open and look at the market,” says Tom.
Companies, he advises, should also bring the consumer to life using ‘inside-out activation’, and harnessing the power of their employees. “It is important that people in an organisation know what is going on in the outside world and understand what people outside need, because people are motivated when they have a passion for what they do.”
It would seem that the secret, then, is to identify and anticipate consumer needs, and deliver a personalised and relevant product or service that harnesses technology to make life both simple and society-enhancing.
“There may be lots of challenges, but there are also lots of opportunities,” Tom notes. “The power and impact of digital technology leads us to conclude that we haven’t seen anything yet – we can’t imagine how far and how fast this will go!”
Jan Turner is an industry PR veteran and a correspondent for the National Bed Federation (NBF).
