4 Driving Forces
Andrew Zolli is a futurist, and makes a living trying to figure out
what happens next. He does this for Popular Science, American
Demographics magazine, National Public Radio, and his own company, Z
Plus Associates. And he’s pretty good at it.
Below are his 4 Driving Forces producing change in the world.
1. The Tyranny of Choice:
While the number of choices available to consumers in the developed
world is increasing exponentially, our ability to recognize between
them has actually dropped slightly. According to research, there are
40,000 different items on sale at an average American supermarket
(including 51 kinds of toothbrush), more than double what was on sale
in 1965. The average consumer can distinguish about 160. Zolli calls
this Moore’s Law of Crap.
2. The Chain of Meaning
:
(Similar to Tom Peters’ progression of products -> services ->
experiences -> dreams.) Let’s use the example of coffee beans –
- Commodity: a small amount of unprocessed coffee beans can be bought wholesale for about 10 cents
- Product: that same coffee ground and put in a can costs about 25 cents (the Maxwell House business)
- Service: that ground coffee brewed in water and served in a styrofoam cup costs a dollar (the Dunkin Donuts business)
- Experience:
that same cup of coffee, served with flavorings and foam in a pleasant
space with background music costs $4.50 (the Starbucks business)
The
margin increases dramatically at each step in this chain, which is why
economies move ever away from commodity as they gain the ability to do
so. Design is a big part of this ability.
So, the trick is, how
do you de-commodify things? Hershey’s did it in Times Square,
convincing people to wait 45 minutes in line to get into a blinged out
Hershey’s store so they can buy Kisses at $25 a pound. Directly next
door is a drug store that sells Hershy’s Kisses for 50 cents a pound.
That’s a 5000% markup — Commodity vs Experience.
3. Demographic Transformation.
In a nutshell, the developed world is shrinking and getting older. The
developing world is getting larger, richer and more urban. The concept
of “Design Within Reach” is laughable to most of the world, and will
continue to be unless price points drop dramatically, and good design
is, in fact democratically accessible to the rest of the planet.
4. Not sure what to call this one…let’s say The Long Tail theory.
This means that, while information and product continues to be produced
primarily by a small number of entities, the number of smaller
producers has increased dramatically (think blogs vs. mass media,
customized shoes on eBay vs. Payless Shoe Source). And consumers are
buying from both ends. The Long Tail also offers unprecedented
opportunities for consumer feedback (think X-Files fan sites re-writing
entire seasons of the show).
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