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- 1. Innovation & Entrepreneurship Week DowntownWorks – 12 October 2016 Presented by Niels Brock California International Business University
- 3. This Series Trends Market Idea Capital
- 4. By the End of this Series You Should be Able to Achieve the Following … Use skills & curiosity to develop an idea Research, observation & data to further the idea Understand interaction of marketplace & consumers Account for external influences on consumers Critically reason using context of consumers Utilize consumer psyche & behavior in all aspects of planning Develop a needs/wants based product, service or concept Innovate in product, price, place & promotion development Create an effective & efficient sourcing & manufacture process Consider alternatives to traditional merchandising & sales Developing a team - partners, production, sales, & funding Aware & able to consider a variety of funding methods Getting started in an effective path to success in your business
- 5. My Background Brian Hawkins MBA … Started working at 16 in construction & cooking Bachelors Degree - University of San Diego MBA - Thunderbird School of Global Management Started my first business, a marketing agency, at 22 Raised more than $40 million for non-profits including Red Cross Invested in first company, a gourmet coffee producer, at 26 Started second company, VolunTours™ donated it 2 years later Started a successfully funded tech company with 3 MIT graduates Launched StyleSeek.com & sold proprietary algorithm in 2015 Developed PreFAB Space, a co-working & retail space for makers Professor in Marketing & Innovation, Dean of Student Affairs
- 6. Niels Brock & CIBU Founded in Copenhagen in 1881 & San Diego in 1995 Niels Brock has more than 130 years of experience delivering business and commerce education. One of Denmark's largest educational institutions serving more than 15,000 students and course participants in Denmark, United States, Vietnam, China, and Myanmar. We develop and incorporate contemporary knowledge and practical education with an emphasis on Innovation and Entrepreneurship. California International Business University is a boutique sized, private, not- for-profit educational institution located in San Diego, California Global Student Network in 80+ Countries. Preparing graduates for top level positions in business management, finance, marketing, media, product management. Formative experience for graduates focused on innovation, startup, and entrepreneurship.
- 7. Niels Brock California Niels Brock California International Business University is a Scandinavian American educational institution, founded on the principles of innovation and entrepreneurship as the basis for business success in the 21st century. Students at the bachelors, masters, and doctoral degree level of studies learn in an atmosphere where theory meets practice. Professors are working professionals whose contemporary business, legal, financial, and marketing experience add to an inspiring and highly practical teaching environment. Whether students desire to work for a company, and lead as innovative thinkers, or they plan to develop their own enterprise, Niels Brock California International Business University provides the experience and tools for success.
- 8. Vision 2020 12 Innovations & Mega Trends Towards the Coming Decade
- 9. Disruption Movement or trend that is changing industries, relating to or noting a new product, service, or idea that radically changes an industry or business strategy, especially by creating a new market and disrupting an existing one.
- 10. Innovation TRANSLATION - The process of translating an idea or invention into a good or service that creates value or for which customers will pay. To be called an innovation, an idea must be replicable at an economical cost and satisfy a specific need. INNOVATION - involves deliberate application of information, imagination and initiative in deriving greater or different values from resources, and includes all processes by which new ideas are generated and converted into useful products. SATISFACTION - In business, innovation results when ideas are applied by a individual, company, or other entity to further satisfy the needs and expectations of consumers.
- 11. Trend PATTERN – A gradual change in a condition, output, or process, or an average or general tendency of a series of data points to move in a certain direction over time. TO FOLLOW - Not only be aware of what is currently happening, but be astute enough to predict what is going to happen in the future. TO LEAD - To have access to, and be able to base decisions upon, contextual information central to the consumer and marketplace for the product, service or concept in mind.
- 12. Context BACKGROUND - Context is most purely the background, environment, framework, setting, or situation surrounding a previous or current event, occurrence, or timeframe. RESEARCH - Context is the information necessary to correctly interpret anything from a word or phrase, or a concept or trend that could otherwise be interpreted in a number of different ways. MEANING - When you say something is out of context you basically mean it's out of place. To be successful we must be IN context.
- 13. Innovation Process CURRENT SITUATION DRIVERS – FROM PRESENT ENABLERS TO PAST CONEXT DEMOGRAPHY • PSYCHOLOGY • BEHAVIOR CREATIVE IDEATION • CREATING VALUE RESOURCES • SOURCING • PRODUCTION MARKETING • ADVERTISING • PR MERCHANDISING • DIRECT MARKETING • SALES DELIVERY • SERVICE REINFORCEMENT • RELATIONSIP BUILDING
- 14. TREND 1 – THE SHARING ECONOMY Peer 2 Peer “P2P” or Collaborative Consumption in Transport, Hospitality, Product, and more… (Uber, AirBnB, YoooWe) Travis Kalanick’s idea of progress is simple and sweeping: transportation as ubiquitous and reliable as running water, everywhere, for everyone. And as part of that vision, he expects to change the way cities operate.
- 15. TREND 1 – THE SHARING ECONOMY The Numbers Uber is likely the fastest-growing startup in history and definitely the most valuable at $62.5 billion, a figure that is quickly approaching the market capitalization of Volkswagen, the largest automaker on earth. It has 1.1 million active drivers (which it defines as independent contractors who have offered at least one trip in the past week) in 361 cities—nearly 100 of which Uber expanded to in 2015. The Challenge While at the same democratizing the labor market, Uber and other similar CC concepts are fairly typical examples of what disruptive technologies can do to labor. From English textile workers to travel agents, new technology destroys job categories at the same time as it creates them.
- 16. TREND 2 – FREE FOR SERVICE Providers and publics are accessing information, entertainment, and other content and services at no direct cost (price for access or usage) to users to an extent not seen before. This trend has been empowered by mass access to and adoption of online tools and destinations, and serves as a major disruptor to the entertainment, content and services industries including music, movies, literature, and communications (‘VOIP’ – Skype, Face Time etc.)
- 17. TREND 2 – FREE FOR SERVICE The Drivers Mobility and the applications and tools that drive it have driven consumers to become increasingly unwilling to pay for access and use across entire business categories, those businesses directly impacted must quickly adopt alternative means of generating revenue in support of providing those very same services or products. Niklas Zennstrom - Look for when the environment is changing — the big shift now is mobile Internet. It’s really happening big-time. The way you interact with services on a smart phone compared to the Web is quite different, so there’s a huge opportunity.
- 18. TREND 2 – FREE FOR SERVICE The Challenge The trick here is to try to figure out the thing that’s unexpected. When Skype started, if you look at analyst reports, no one forecasted it as a big business. Also when Google started, it was not fashionable to be in search. It’s not trying to do the obvious – that’s the hard part. You have to figure out what it is – you have to stumble on it.
- 19. Trend 3 – Entrepreneurs & Startup Entrepreneurship & Small Business… Traditional Business Makes a Comeback with personalization and the web as catalysts. Two Harvard Business School graduates started Birchbox in 2010 as a monthly subscription service that delivers personalized selections of beauty products to your door. Today, that concept has grown into an offline store in Manhattan and online service in Canada, as well as a women's magazine and lifestyle guide for men. That combination, along with Barna and Beauchamp's business smarts, catapulted Birchbox to an April 2014 valuation of $485 million. They've sent out millions of boxes so far and have even expanded across the ocean to five European countries.
- 21. Trend 3 – Entrepreneurs & Startup The Numbers In the US, Startup activity saw the largest annual increase in 20 years. The Challenge Eighty percent of new entrepreneurs previously held jobs - more than last year but still lower than historical norms. 27 million working-age Americans--nearly 14 percent--are starting or running new businesses. "Entrepreneurship in all its forms will continue to be essential to rising standards of living and expanding economic opportunity."
- 22. Trend 4 – The Slow Movement Be on the lookout for handmade, small batch, artisan and stone-ground products embodying crafting techniques long revered by some consumers from Cuisine, Beverages, and Fashion. Originally unique to the Specialty Gourmet universe, regional artisanal products are making their mark in all channels as entrepreneurs continue adapting small-scale production to supply retail stores – without losing quality. Brands that stay dedicated to their home state are popping up more and more, answering growing consumer demand for foods that also match production values important to them: low carbon footprint, organic, biodynamic, even Certified B Corporations™.
- 23. Trend 4 – The Slow Movement The Numbers (Apparel Industry Example) According to author Lucy Siegle's "To Die For: Is Fashion Wearing out the World?" Americans purchase, on average, 68 pieces of clothing and eight pairs of shoes annually. That's about 25 billion garments each year, well more than the 7.3 billion people who inhabit the planet. The Challenge Educate, inspire, and influence change in the fashion industry by encouraging consumers to slow down and make more conscious consumption decisions. From McDonalds to H&M this trend promises to challenge the well established business models of companies for whom volume sales has been key.
- 24. TREND 5 – MICRO-MARKETS & SEGMENTATION – BIG DATA Diversity, Pride & Product Development The advent of the internet and mobile communications was foreseen as a great equalizer, necessitating a broad industry move towards standardization. The trend towards consumer tastes becoming more common never came to be, in fact, the reverse effect has been a hallmark of the internet and mobile. Quantifying Factor… - Demography as an Anchor Qualifying Factors… - Psychology as context and message driver - Behavior as attraction and permission
- 25. TREND 5 – MICRO-MARKETS & SEGMENTATION – BIG DATA
- 26. TREND 6 – INTEREST BASED MEDIA Interest (Instagram) Media Overtakes Social (Facebook) in Effective Business Communications. Ariana Huffington, The Huffington Post - The Huffington Post is the Tesla of media because it is the closest thing to a traditional entity that sprang into being, seemingly out of nowhere and very quickly forced the industry to question a lot of long-held assumptions. Among those assumptions were the following: No one of any quality would write for free, Users wouldn’t want a news aggregator, A new entity couldn’t build a large audience, Viral content can’t be treated like a science, A viral-media site couldn’t evolve. All of this helped The Huffington Post build what became a $315- million organization in a little more than 5 years, right under the noses of the largest and world’s most well-funded media entities.
- 27. TREND 6 – INTEREST BASED MEDIA Widespread Interest based media adoption & use is feeding consumer sharing of brands & experiences, as well as validation
- 28. TREND 7 – THE NEW CONSUMERISM Consumer as a Marketing Force – Affinity, Advocacy & C to C Marketing (Instagram, Yelp, Trip Advisor, Pinterest) Individualism – Expression as the Driving Force in Brand & Product Selection Customization – Demand and Access (e.g. Emerging Technology 3D Printing) Dynamic shift from Trinkets and Trash to Treasure – Made in China, Home Goods, Fast Fashion are on their way out, the great recession changed buyer behavior) Limited lines, Specialty, and Collaborations (adding depth and breadth to consumer choice) Immediate Gratification – Drone Delivery to 3D Printing (Nike & Adidas)
- 29. TREND 7 – THE NEW CONSUMERISM Pop-Up Storefronts Interactivity Mobility Point of Sale
- 30. TREND 7 – THE NEW CONSUMERISM Bridging The Gap Between Consumers Online & Offline Search, Interest, Consideration, Sharing, Validation & In-Store Purchase
- 31. TREND 7 – THE NEW CONSUMERISM The Different Perspectives of Consumers & Merchants Need to be Bridged…
- 32. Trend 8 – Democratization of Luxury Broad-based global demand… Luxury is… living an unforgettable experience Dining Out Personalized Service Boutique Size Intimacy
- 33. Trend 8 – Democratization of Luxury
- 34. Trend 9 – Lifestyle Small Living – Simplicity & Small Become the New ‘Conscious’ OR ‘Simple’ Status Symbols Urbanization – Historic Migration to Cities and Urban Centers
- 35. Trend 9 – Lifestyle Small Living – Simplicity & Small Become the New ‘Conscious’ OR ‘Simple’ Status Symbols Escape to the Wilds – The New Pioneers & Explorers
- 36. TREND 10 – PRODUCTS & SERVICES Customization – Micro Sourcing & Manufacture, Crowd Funded Sales, Capsule Collections (NikeID) Handcraft – On-Shoring, Craft Movement, Makers & Merchants Enabling their Sales (Etsy, Big Cartel, etc.) Authenticity – Brand & Product Meaning, Context, Construct & Communications
- 37. TREND 10 – PRODUCTS & SERVICES Smart Products – Smart shoes, smart cars, smart appliances, smart homes (Internet of Things – maturity of web communications – we’re busy, our homes, appliances, and transportation must and will get smarter and help us fill in the gaps. (Consumer)
- 38. TREND 10 – PRODUCTS & SERVICES Wearable Tech – music, data, communications, perhaps migrating to implants
- 39. TREND 10 – PRODUCTS & SERVICES Industry 4.0 (similar to the consumer market above) but targeted to assist business (smart warehouses, logistics, supply chain, production – robotics, communications)
- 40. TREND 11 – CORPORATE STRUCTURE & WORKPLACE On-Shoring & “Vertical Integration” All or Most Functional Areas Consolidated within the Company rather than outsourced to agencies at home or providers abroad. Apple and Tesla are two of the world’s most talked-about companies. They are also two of the most vertically integrated. Apple writes much of its own software, designs its own chips and runs its own shops. Tesla makes 80% of its electric cars and sells them directly to its customers. It is also constructing a network of service stations and building the world’s biggest battery factory.
- 41. TREND 11 – CORPORATE STRUCTURE & WORKPLACE A century ago vertical integration was the rule: companies integrated backwards, by buying sources for raw materials and suppliers, and “forwards”, by buying distributors. For the past 30 years firms have been focusing on their core business and contracting out everything else to specialists. The reasons for the reversal? 1. SIMPLICITY – Consumers will pay more for products integrated under one company eliminating multiple calls if issues should arise. (Apple) 2. EFFICIENCY - Companies that are inventing the future frequently have no choice but to pour money into new ventures rather than buy components off the shelf (Tesla vs. Boeing) 3. CHOICE - Netflix and Amazon now create their own television shows in order to keep their viewers from buying more generic content elsewhere. 4. SPEED - Zara operate their own clothes factories, employ their designers & run their own shops allowing them to design, manufacture and sell quickly. 5. SECURITY – Owning & operating eliminates many contingencies
- 42. TREND 11 – CORPORATE STRUCTURE & WORKPLACE SOCIAL ENTERPRISE & RESPONSBILITY Triple Bottom Line Reporting – Measured Impact of Financial, Human Resource, and Community, B Corporation Ann Wang, 24, Jessica Willison, 24 - Cofounders, Enrou an online marketplace where customers can purchase products that are made in the U.S. and developing communities around the world. The company creates jobs and also links artisans with local organizations that provide training and educations. Buyers are introduced to creators via stories that accompany the goods.
- 43. TREND 11 – CORPORATE STRUCTURE & WORKPLACE CROWD MEETS COMPANY Co-Working & Incubation – The Sharing Economy Meets the Workplace – Agilent Growth
- 44. TREND 11 – CORPORATE STRUCTURE & WORKPLACE
- 45. Trend 12 – Retail & Merchandising A BOLDLY NEW RETAIL ENVIRONMENT IS TAKING SHAPE… Angela Ahrendts - To her, the store is a "big giant product" in itself," and she says it has evolved in a similar way as the iPhone and Mac, and gotten "sleeker and smarter" over the years. But, she wonders: "How do we get our kids who prefer no human interaction into these stores?” The company is now working to better unite its online and offline experience. Ahrendts also wants to re-center the physical experience around particular "passion points." Next - "The Avenue," which has Apple’s accessories repositioned from the wall into an experience that feels more akin to walking down the street of a "small town and looking into each window.”
- 46. Trend 12 – Retail & Merchandising A BOLDLY NEW RETAIL ENVIRONMENT IS TAKING SHAPE…
- 47. Trend 12 – Retail & Merchandising OMNICHANNEL - Click to Brick / Omni Channel – Bridging the Digital Divide Between Consumer & Seller. Technology Meets Storefront – Integrate Online Virtual with In-Store Experience. A new revolution is upon us and retailers who continue to think of themselves as a store will simply be unable to produce, measure and innovate at the speed of the enlightened omni-channel retailer, whose business is everywhere. While many retailers continue to think and manage their businesses according to channel — whether it’s a website, a store or a catalogue — the fact is, the customer has moved on and increasingly expects to be able to interact with her favorite retailer across channels, shifting seamlessly between online and in-store experiences. Synchronizing inventory and shopping experience, not to mention returns, across multiple channels is the retailer’s responsibility. And the shopper expects to never have to see or interact with the man behind the curtain who makes it all happen.
- 48. Trend 12 – Retail & Merchandising
- 49. Trend 12 – Retail & Merchandising The necessary Core Competencies for In-Store Success • Impeccable Curation of Product Selection & Interplay • Attention to Detail, Story Telling, Extensive Product Knowledge • Quality Products Offering High Value, Brand, Product, Price • Unmatched Service from Product Knowledge to Sales, Follow-Up Omnichannel –Digital Integration will be Necessary for Survival • Bridging Online with Offline – Search, Discovery & Validation • Warby Parker, Shinola, Have Limited In-Store with Primary Focus Online • Consumers Understand Differentiation, Demand Difference, Retailers Must Communicate it (Burberry) • Online is Migrating to Mobile & Apps Now & Next to Bots -
- 50. Trend 12 – Retail & Merchandising The true joy of a store is not looking at digital representations of products on a screen but being able to touch, feel, taste, smell and experience products in a visceral way. It’s not about watching a golf video in a sporting goods store. It’s about swinging a golf club. It’s not about speaking to a chatbot about your product needs. It’s relating with an enthusiastic and delightfully human product expert. It’s not using virtual reality to escape the boredom of the store. It’s using a remarkable store to escape reality — to enter a different world — just for a while! Consumers crave physical experiences at retail — not because they can’t get the goods they want online but because of an almost primordial need to interact with the things we gather.