The current period of social isolation could yield many valuable business insights, spawning a raft of innovation while Covid-19 is also likely to dramatically accelerate the process of business disruption.
That's the view of Toronto-based Jeremy Gutsche, founder and chief executive of Trendhunter. com, which claims to be the world's most popular trend-spotting community with up to 20 million monthly views.
"Chaos creates opportunity. The Renaissance was created from the bubonic plague. If you look at periods of recession you will see Disney, Apple, Hewlett Packard and General Electric founded in periods of major economic decline," he tells The Irish Times.
“Consumer needs and prioritisation will change. People are now spending long periods at home and are banned from meeting in groups, so they are going to have different priorities. We saw it before in the 2008 recession where potentialism became a trend, with people wanting to realise their full potential.
“We saw people returning to the kitchen for a family meal, people got into the hobby businesses, and we saw boomers in particular wanting more fulfilment. In the travel market, for example, we saw a boom in adventure tourism and volunteerism rather than just sitting on a beach. We’re going to see something similar now but on a much bigger scale.”
Aligning to the concerns of the younger generation could prove fruitful in more ways than one. There are already interesting examples of purpose-driven business. He cites examples of a market emerging for ocean plastic sunglasses, shoes, shirts and collectables.
Gutsche, whose grandfather hailed from Co Meath, originally developed Trendhunter.com as a night hobby while working for a bank called Capital One and turned it into a successful business. The website is a user-driven platform with 200,000 contributors charting examples of innovation throughout the world and has a vast array of articles and tools for entrepreneurs.
Cluster of opportunity
The key to its success and its revenue model lies at its backend where Gutsche and his team analyse the trends and produce rapid customised insights for corporate clients such as Coca Cola, Adidas, Samsung, Microsoft and Nasa. It has also made him something of a "go-to" figure in the US media with a high profile as a futurist, innovative trend-spotter and conference speaker.
Gutsche’s thoughts have been distilled into a doubled-sided business book title called Create the Future: Tactics for Disruptive Thinking, which is paired with an updated version of an earlier New York Times bestseller now titled The Innovation Handbook. Packed full of ideas and mini case studies in an easy-to-digest format, the book pre-dates the current crisis, but according to the author, many of the trends he has noted will merely be accelerated by current events.
According to Gutsche, if you can identify a group of similar ideas, chances are you have found a cluster of opportunity or what is often known as a consumer insight. An example would be caffeinated beverages, caffeinated chocolate bars, caffeinated potato chips and caffeine pills. When these four trends started spiking in popularity, your insight might be called “alternative caffeination” and you should study the reasons behind it to better understand what is driving it. Based on the momentum behind the alternative products that are gaining traction, you could predict new products and services that would probably trend positively for one to five years.
At a broader level, there are three megatrends at the moment that innovators should be aware of, he says.
The first he defines as hybridisation, the process by which industry lines are blurring and competitors could emerge from anywhere. Witness Amazon’s entry into the grocery market through its purchase of Whole Foods and its plans to open a line of retail stores.
“The lines that separated different industries have been blurred so when you have chaos people are going to make big moves and you are going to have large hungry competitors getting into your market or you could decide to get into another market more easily than you could before.”
Kodak's famous inability to see the importance of the digital photography market which resulted in the corporation's death is illustrative of a common pitfall. Gutsche says he interviewed the Kodak executive Steve Sasson who invented the idea in 1975. Sasson noted that he loved his job and was actively encouraged in his innovation efforts but crucially the corporation was not brave enough to cannibalise its photographic print business.
Reframing the business you are in is crucial. In Kodak’s case, had they defined their business as “capturing memories” rather than creating perfect prints, they might still be in business today.
“There is a lot of talk about creating a climate in which it is okay to fail while experimenting. That’s all very fine in theory but we tend to get promoted for all things we say ‘no’ to. A big mistake holds people back in their career so while people say they are okay with failure, they don’t want to be the actual one that fails, so people act conservatively.”
He quotes a darkly humorous line from the 1999 air traffic control-centred movie Pushing Tin to nail his point: “You land a million planes safely and then you have one little mid-air [collision] and you never hear the end of it.”
With a background in analytics, Gutsche says that the capacity to minutely parse information acts as a blunting force on creativity and innovation. The use of analytics is a great way to de-risk so it promotes incrementalism and it’s a great way of finding out how to safely squeeze a small extra piece of margin out of a business so it’s no wonder it is so popular in boardrooms, he notes.
Innovation isn't the preserve of the big or well-resourced. The second trend Gutsche identifies is instant entrepreneurship. Based on the interests of his 10-year-old niece, he cites the hypothetical example of an enterprising child who now builds a virtual business from their bedroom. In this example, the child has a passion for dinosaur figurines and can design and order a 3-D printed prototype, make a video for YouTube, crowd-fund on a Kickstarter platform, have designers around the world compete to design her logo, create a website and launch a global business in a few days – in theory at any rate.
Add to that, the scale of the growth of the global market and the possibilities are enormous. The English-speaking internet-connected world alone is 15 times the size that it was in 2000, he notes.
The third trend is Artificial Intelligence. So far, AI’s capability is quite limited but in about 10 years, he says, if an AI system were only as fast as computers today but as smart as a typical Stanford researcher, it is estimated that it could do 11,000 years of research in a single week. The implications for how we live, save the planet and cure diseases are immense.
“Five years ago, these questions were the source of science fiction but AI is now advancing twice as quickly as expected. This has become the most important piece of information for innovators, futurists and society as a whole to understand.”
Gutsche’s Adaptive Innovation Framework
Define a clear customer need: be as specific as possible and try to ignite passion in a clearly defined customer segment.
Brainstorm: Push for range and variety in the ideas suggested, create group energy, encourage humour and challenge with very specific problems.
Refine best ideas: rank your best 10 ideas, test them in online and other surveys and filter down to the best three.
Create rapid prototypes: Almost anything can be prototyped and this will quickly uncover the factors that could enable or hinder the success of your idea.
Test and optimise: Scientific method becomes important when you are in unchartered territory, testing new and cutting-edge ideas. It finds way to quantify the uncertainty.
Create the Future: Tactics for Disruptive Thinking by Jeremy Gutsche is published by Fast Company Press, New York