n our business as consultants, we are often asked to look at the future and tell clients what trends will help them win and build the roadmaps, execution plans, budgets and operational detail to get them there.
One of the most common obstacles we observe in clients of all shapes and sizes is that they have existing processes, memes, and “just the way things are done here” inertia that routinely inhibit the very recommendations that consultants, boards and other advisors recommend.
This implies that organizations and their leadership are myopic, incapable, or can’t get out of their own way.
Although this is a meme that is frequently inaccurate, bell curves can be effective tools for describing most sociological variables, and how and when individuals and organizations embrace new technologies, trends, and processes is no exception.
This figure, called the Classic Adoption Bell Curve, indicates how few of us actually accept and utilize a new technology or approach right out of the gate.
While the phrases “Digital Disruption” and “Digital Transformation” may seem newly on-trend in business vernacular, most career consultants have been working on some form of these approaches for as many as 25 years. It’s only because of the trajectory of the adoption bell curve that it has just taken so long for the importance of digital marketing and commerce to permeate modern business sensibilities.
The data does suggest that adopting new concepts is hard for most of us and any organization that has to fight against entrenched processes and other obstacles might find it to be even more challenging than usual.
We are likely at the praxis point where nearly everyone agrees that Digital Transformation, or at least adopting innovative approaches to digital, has become a necessary component of any scalable business.
Something that we often see lost in the plot, however, is that there is a parallel trend happening in product and service development around authenticity and history that ignores trends in digital marketing altogether. This curious “Yin and Yang” of opposing forces introduces a conversation around balance for consultants, brand marketers, and product development gurus.
In essence: Where is the meridian between solving a brand or product problem with more advanced marketing techniques versus actually re-evaluating your overall product line to win in an economy increasingly preoccupied with history, quality, durability and legitimacy?
The Domino’s Effect
Even “post-laggards” or analogue holdouts who still (somehow) aren’t convinced of the digital revolution might consider case studies such as the growth of Domino’s Pizza, who has proven especially adept and clever at mobile and online customer service.
Growth in Dominos Enterprise Value rose from ~$300m eight years ago to $7.4b today
Domino’s saw an opportunity to embrace the digital transformation and has executed better than most large fast food brands on the digital customer experience as a result. There was nothing prohibiting McDonalds, Denny’s, Red Robin or any other mega-food services brand from adopting “one button purchasing” and convenient home delivery — they simply chose not to capitalize on the digital trend. Perhaps even more important is the fact than Dominos simultaneously ran a significant nation-wide campaign about how they were upgrading their food to taste better and be healthier. They even showed huge self-effacing humility and reasonable authenticity about their food previously tasting like cardboard.
It is in this awareness that the “Yin and Yang” of Digital Disruption is expressed. Yes, there are examples of cheap overseas products making a quick buck by using better e-marketing, sizzle videos and YouTube infomercials, but for long-term sustainment and growth, “just going digital” and revolutionizing your customer experience with one button ordering is usually not going to be enough unless the product you are selling is truly a stand-out.
In some cases, the digital transformation that impacts businesses the most is the accelerated discovery, word-of-mouth, or reviews on quality that drive attachment, as opposed to a business being overly clever about digital brand management.
It is in this awareness that the middle path of balance, or Yin and Yang between extremely high quality and extremely adept digital marketing, communications, and customer experience can be expressed.
A Little Balance, Big Results
Little Big Burger in Portland is a great case study on achieving balance for two reasons:
1. They present a stripped-down menu, a bare bones website, and they don’t have a “one touch” delivery button on a mobile app that will drop your burger from a drone.
2. They are very active on social media and have built a community around their food by producing hand-crafted burgers made with local ingredients.
In Little Big Burger’s world, the application of Digital Transformation is to use the tools at hand to empower their customers to engage with their brand and with each other where all boats rise with the tide. “Digital” to Little Big Burger is just a faster and more efficient version of however many water cooler conversations result in awareness of their brand.
In short, companies such as Little Big Burger are only peripherally involved in advanced planning around high-tech marketing but are growing at 50 percent YOY based on the simplicity and execution of their concept, the portability of their business, and coherence of their overall user experience.
These hallmarks of old-school brand and product marketing — especially in an era where authenticity and “the art of being genuine” reign supreme — are clear indicators for why Little Big Burger is such a quickly evolving brand.
Riding the Centerline
A firm that provides an intriguing centerline between a modern digital approach and classic, legacy brand durability is Airstream trailers. Airstream is so persistent in their category both historically and viscerally that their brand is often invoked synonymously with the act of RV-ing itself.
However, more seasoned brands often struggle to harness digital strategies to re-ignite enthusiasm around the brand, especially among millennials and other highly connected users. (*The Levi’s campaign around multi-generational authenticity was very popular for example, but so was the SNL skit around its positioning, and no one needed to underscore the transparency with which Levi’s was very much hoping to achieve brand re-ignition by using digital to appeal to millennials.)
Airstream has been able to solve for this challenge by taking a completely different look at what is means to be part of the RV community. If you are a millennial, the Airstream Basecamp isn’t your fathers lumbering fifth wheel being towed behind a giant Dodge Diesel dualie; It’s a chic, sleek, and very clever “tiny house on wheels” that can easily be transported as a lightweight pop-up tent that one can tow behind a small passenger car or weekend rental or shared ride vehicle. It is of course important to market this new product addition not by reinforcing legendary Airstream quality, but rather by making case study and user story videos of what sort of incredible lifestyle is possible with this simple, lower-cost, and unique take on the firm’s existent product line.
Airstream Basecamp and attendant video marketing showing lifestyle possibilities.
Ducati has taken a similar approach with their Scrambler line. The bike is less about performance features and more about a) How you can have fun on a bike, and b) What sort of adjacent lifestyle might one invest in in addition to the bike to maximize having that fun?
To this end, the Scrambler line also features a smaller, brightly colored suite of bikes for new riders and women who might otherwise be intimidated by motorcyles. Like Airstream, the Ducati Scrambler line is heavily marketed through seductive lifestyle videos that look more like music videos directed by Tarantino than they do typical motorcycle ads.
The Scrambler line was a huge initial success and quickly represented over 25 percent of Ducati’s total volume sales in the U.S.
Ducati not only markets an aspirational lifestyle for customers, but also provides an entire litany of different ways to customize a Ducati Scrambler and customize one’s lifestyle off the bike through branded clothing, accessories, and other partnerships.
Both Airstream and Ducati were looking to solve for slightly different market tendencies than either Domino’s or Little Big Burger. The RV and Motorcycle markets can have static or even negative YOY growth based on a variety of demographic and whimsical cultural variables.
The ability to combine new, exciting, highly differentiated products and then tell a coherent story to new customer bases as to why they should adopt a product that hasn’t traditionally been part of their lifestyle was a key interplay for these firms. The point is, without the Basecamp and Scrambler innovations, just investing in an advanced digital marketing campaign alone was very unlikely to create the same effect.
Mind the Gap
Regardless of where a company finds its centerline between new product development and clever digital marketing approaches, the overall spend in non-traditional marketing is growing at an astonishing rate. To this end, all firms will have to consider planning around mobile, social, viral, and other forms of non-traditional communications.
According to eMarketer, Digital Ad Spend has almost doubled in the past 5 years but accounts still for only a fraction of traditional television, print, radio, and other ad format spends. This does not account for free, word-of-mouth social media promotions, ratings, reviews, and other similar forms of e-promotion. This may only reinforce what we said previously about the tendencies in adoption. In other words, if we are truly crossing the chasm on Digital Transformation, then Madison Avenue is perhaps at the slower end of the adoption bell curve.
So, if the big buzzword is “Digital Transformation” and everyone is asking how they can take advantage of mobile, IoT and real-time sensors that use facial recognition to detect moods that inform bespoke services that cater to how any customer feels at that exact moment in the day, we might again reference our Yin and Yang insights:
More than ever, customers attach to convenience, but they also are aware of quality and how their friends, peers and affinity community feel about a brand.
For brands such as Domino’s, who spent 50 years differentiating in “30 minutes or less” pizza delivery, new business systems such as mobile apps and “car as a platform” culture were huge drivers of that particular business.
For brands such as Little Big Burger, they will likely continue to expand very nicely with a simple menu, a simple digital presence and an amplified social media footprint that drives awareness of their quality and home-grown service.
For firms such as Airstream and Ducati, they actually introduced well thought-out new entries into the market but coupled those significant investments in new product development with equally rich and multi-faceted digital campaigns to promote “lifestyle aspiration” as much as the quality of the brand and product itself.
For companies that are still planning and galvanizing their own approach to everyday business and the evolving digital ecosystem, we recommend plotting where your organization is on the digital adoption bell curve but simultaneously plotting where your brand is on the quality, authenticity, word-of-mouth rating and “promise kept” to end-user experience road map.
As consultants, we are routinely asked to address significant areas of focus in strategy, re-building or renewed go-to-market efforts by leveraging contemporary approaches like “Digital Transformation”. Sometimes clients are very early in the adoption cycle of these approaches and sometimes they embrace new tools of execution much later.
After working with countless firms on these types of strategies, the key insight is that all the digital firepower in the world will only be a short-term fix if the core principles of brand and product management aren’t foundational, especially in an age where product and service quality and integrity are arguably at an all-time premium.