Brilliant topic and you know how unbiased I am! I really enjoyed reading an article written with a fresh set of eyes.
Burberry has definitely done a great job with digital: not just at creating modern and inspirational products and stories thanks to technology (3D printers, CADs, digital archives etc.) but also at using the innovative content to engage younger consumers online and with social media. We made a point to partner with every up and coming tech company: Apple to film the runway with the new IPhone 5 just before its public release, Google Kisses, SnapChat, WeChat and Kakao and more recently Facebook Live and Facebook Messenger. As you mentioned, further pioneering new ways to engage with customers, Burberry led the revolution of “see now, buy now” in order to immediately convert social media buzz into sales rather than waiting 6 months for the buzz to die down before collections actually hit the stores. They also merged menswear and womenswear into one and only show, further adding variability in production requirements. See https://www.businessoffashion.com/articles/intelligence/how-burberry-is-operationalising-see-now-buy-now.
These business decisions are a way to address the decreasing demand linked to the tightening macro economy. They have undoubtedly put significant strain on production and supply chain, which had never been built to handle the requirement of immediacy and are struggling to adapt to earlier timelines and increased variability. Offering immediate orders of 1 make-up SKU straight off the runway back in 2015 had already been a significant challenge.
As to emotionally connected clothing, Burberry has larger fish to fry and has not started exploring beyond RFID technology. Nonetheless, others are exploring this route. Philips is one of them as they recently released the output of the skin exploration research. The garments of the Bubelle dress, demonstrate how electronics can be incorporated into fabrics and garments in order to express the emotions and personality of the wearer (http://www.electricfoxy.com/electricfoxy/2009/01/bubelle-blush-dress-reacts-to-emotions).
Thanks Beth, so excited to read a post on my favorite auction-house! Let me know when the Arts Club is planning to visit them!
Online salesrooms are certainly the way forward for the lower and middle parts of the art market (<$100k) as buyers are increasingly nomadic, craving convenience and immediacy, and relatively cost sensitive. This is a great choice of topic to showcase how important digital is to a startup's business model. Democratic luxury sounds like an oxymoron. And yet, as the sub $100k market hones in on sophisticated technological innovations and operational structures to accommodate high volume, automated shipping and insurance, and remote consignments, Paddle8 positions itself very separately from traditional high-end auction-houses. In addition, the online model provides significant cost efficiencies and savings (eliminating the middle-man, shipping costs, printing of physical catalogues and prime real estate) which are then passed on to the buyer and seller.
Regardless of the online medium, the physical experience is still key to providing the drama of an evening sale. To address this, the startup has been investing early on in tangible experiences and destinations by collaborating with monthly guest curators such as Grace Coddington (http://modafamilia.com/news/grace-coddington-curates) or Robin Williams, who increase emotional engagement by taking over the site entirely (https://techcrunch.com/2012/02/08/founder-collective-makes-a-4-million-bet-on-paddle8s-online-marketplace-for-fine-art/.). Pop up showrooms are also in the works.
Interesting post, thanks Pablo. DSC is definitely leveraging digital to acquire new customers through its subscription model. The startup promises to shave time and shave money by delivering razors and blades in bulk for a fraction of the cost of the grocery-store equivalent. However, in my view, digital is just a smart operational choice enabling to cut costs instead of paying for brick-and-mortar but in now way an essential component of the business model. Indeed, as an e-commerce startup, DSC’s appeal is not so much in its digital prowess but in its ability to create a powerful brand in no less than 4 years. As an early investor puts it in the following Bloomberg article (https://www.bloomberg.com/news/articles/2016-07-20/why-unilever-really-bought-dollar-shave-club), “he never saw the shaving upstart as an e-commerce company. The key, he said, is how Dollar Shave Club developed relationships with men, many itching to find an alternative to the high-price blades sold by Gillette and Schick”. Few other e-commerce startups can claim to have built a brand so quickly, nor have e-commerce startups attracted $1 billion bids. Traditional marketing master Unilever is investing in DSC in order to build on the direct-to-consumer segment, to hone in on customer-relationship skills, to gain access to customer insights, or to preempt competition, but not so much to position itself as a tech-savvy organization.
Great to see that you were also interested in how digital impacts the public sector and more specifically the US government. Interestingly enough we chose to address different angles of this revolution and I was excited to read about your focus on social media and how they enable direct, authentic and instant communication with the country, millennials specifically. Obama’s inspiring AMA initiative on Reddit is the perfect example. Nonetheless, I tend to see social media as a popular game changing tool for candidates, helping them improve their chances to win by generating incremental support and raising funds, rather than an effort to promote technology. Indeed, this article (http://www.huffingtonpost.com/r-kay-green/the-game-changer-social-m_b_8568432.html) is one of many explaining how social media have the power to influence polls significantly, second only to televised debates. Social media are the key to engaging people by providing them with the opportunity to directly take part in the campaign by sharing their candidates’ posts and debating online. Moreover, conditioning voters to take directly part in campaigns sets a precedent, eventually leading people to the polls when time comes. This explains why candidates are increasing their spending on social networks, in my view more as a mean to improve their odds and influence the result, than as a vehicle for technological change.
Love to read about 3D printing which is also extensively used in product development to test new design ideas! The reason it’s such a fantastic technology in my view is that it’s incredibly dynamic and fast. But as 3D printers become more affordable, accessible and easy to operate, I agree with Caroline’s concerns. 3D printers will eventually become as common as flat-screen TVs, microwaves or computers (https://www.makerbot.com/products/3d-printers/), with companies and consumers experimenting to create and design their own concepts and ideas. This trend will most likely radicalize how companies manufacture products without middle-men such as UPS and how we shop as consumers. This article (http://www.businessinsider.com/3d-printing-future-2012-103D) highlights the fact that very soon now “owning a 3D printer [will] mean no longer having to drive to the store to buy something manufactured in China, put on a boat, loaded into a truck, and dropped on a shelf.” Printers are definitely a powerful tool to improve products and services but in no way will they remain a competitive edge for UPS unless the company can leverage them to offer really cheaper product options and reduce friction linked to the convenience of buying the part.
Interesting post. Like DS, I believe paper is not a culprit but potentially a great raw material that can replace hydrocarbons products, for instance in packaging. It is somehow greener to process lignin and let it rot or burn it than removing hydrocarbons from geological layers and burn it. Personally I am a strong believer than lignin and cellulosis could save us in transitioning smoothly and efficiently away from too much hydrocarbon chemistry. Both Hardwood and Softwood pulp are seeing quite a lot of productivity increase. Brazil production is increasing and could be supported by warmer climate – to a reasonnable extend.
A company such as The Navigator Company does a good job at biomass energy and innovation in woodfree paper. They are also aware of the potential climate change advantage of forestry products… to some extend they are not green for no reason!
But white paper (WFC and UWF) is unlikely to be as green as gray recycled paper from old newspapers or amazon corrugated boxes!
Very thoughtful article on this iconic customer brand.
As I read through the strategy of those fast moving affordable luxury brands, I cannot help but think that they have a structural conflict of interest: Nike wants sales. So Nike wants fast moving shoes. People need to have more pairs (tennis, casual, running, basket, barefoot…) and change those more often. This creates very negative climate externalities.
Not long ago, people kept leather shoes for 10 years and they were multi-activity and multisport. We kept the jean but now live in a fast fashion world that consumes more ressources moving inputs and outputs around.
When will Nike provide with an all-round pair of shoes lasting 10 years?
I’ll be a buyer because these trainers will be iconic.
Very interesting article that sheds an interesting light on downstream food processing industry. As the headline suggests, we could have a similar articles on milk producers and the impact of cows on climate change.
Reading through, I was wondering:
1. Given low direct water usage, to what extend the reduction of water consumption shall come from the public sector regulating vs. private companies efforts? Some of those efforts seems to look like green wash if the problem is not completely cured. As there is mpg targets and emission regulation, you could imagine similar systems for cereals farmers with smooth transition mechanisms.
2. Thinking of agricultural efficiency, this echoes various posts on seed & agri-business companies (Syngenta & Monsanto) – there is clearly more than just business here. How the profit and incentives of agri-innovation is shared seems critical to me?
Love how you spoke to the effects on each grape variety of wine!
Indeed, climate change is threatening the artful balance between sunshine and humidity. Too much sun in the vineyards will affect the quality of the produce. Too much rain (or none) will affect quantity. As such, in France it it said that grapes are now harvested 2 to 3 weeks earlier than 30 years ago as Springs become warmer, accelerating the flowering stage and the ripening of the fruit. The more the grapes are exposed to sun, the more concentrated in sugar they become, making them more highly concentrated – mostly above 14 degrees nowadays. And yet, some usually more acid varieties are actually benefitting from warmer temperatures. Champagne for instance is not complaining. And neither are we.
Nonetheless, these effects are dramatically changing the wine cartography. In a century, wines from the South of France could resemble those found in Sicily and the production of Bordeaux wines could shift to… well the United Kingdom or the hills of central China. Yet another reason to be concerned.
Source: The Guardian, Climate Change Wine Production, 4/8/13
Thanks Kevin! Loved to read about the growing awareness of sustainability in hospitality and on how hotels are increasingly focusing on driving stakeholder engagement – guests, employees, suppliers, owners, franchisees – in this controversial space.
What strikes me the most is that these topics have recently been moving up on the agenda and are becoming more strategic and innovative – industry leaders had kicked off efforts 4-5 years ago. The focus then was on tactical changes such as rethinking housekeeping carts to enable more efficient disposable of guests’ trash. Today, leaders are looking at how to strategically decrease energy consumption through partnerships with innovators such as Siemens or Kiwi Power. Hotels are also considering supply chain collaborations with suppliers, focusing on water scarcity and cotton farming. Their goal is to ensure that all of their suppliers share the same business practices and values.
Hospitality is an incredibly difficult industry to improve in regards to climate change due to the sensitively tailored approach required at each destination in the guest’s journey. Nonetheless, sustainability is exciting for Hilton as it creates an opportunity to engage the public and welcome a whole new audience into their properties. Don’t know about you but I’d like to see self-sustaining properties being built in the future, producing enough energy to export for local consumption! Also, employees need to be involved from the very start and should be empowered to shape tomorrow’s best practices. As Marriott’s philosophy suggests: “Take care of our associates and they will take care of the customers”.