As Batman’s nemesis The Riddler would ask: “Riddle me this: Why is the U.S. residential construction industry still building McMansions despite millennials not buying houses, baby boomers downsizing, and the ever-increasing focus on environmental footprint?”
This riddle, unfortunately, has an easy answer: Because that’s what they’ve done the past few decades, and it was profitable then.
Photographer: Daniel Acker/Bloomberg News
Avoid that blinder mentality by considering the impact of these three trends on your future:
1. Location independence
When Sirius and XM satellite radio were first developed, the skeptics asked why anyone would ever pay for radio when they could already get it for free.
The answer is the value placed on location independence.
Consumers want to take their lives with them wherever they go without any effort. That same thought process is impacting business-to-business products and services.
People devoted to their coffee makers might love to have a very portable version to take with them everywhere they go. Not single serve necessarily, but very portable. Maybe even as an option on a car?
How can you best meet the expectation of location independence?
2. User-controlled pull
Network TV was surpassed by cable and then satellite, which has now been largely replaced by streaming services. What’s the attraction?
Users want control over what they enjoy, as well as when and where. The days of traditional entertainment companies pushing their schedules on consumers are gone.
That same “user-controlled pull” trend is reflected in services like iTunes and Spotify that have changed the economic model of music. Amazon’s monthly service to “rent” books resembles a library, with a fee and no requirement to drive anywhere.
The baby-boomer commitment to ownership is being replaced by a much more practical “I-want-it-when-I-want-it-and-not-otherwise” logic that created Uber, AirBnB and more.
How will you meet the expectation of customer-controlled pull?
3. Secrecy or publicity
The third trend is one that requires meeting two ends of a spectrum. Bitcoin is an example of devotion to efficient and completely untraceable secrecy while Facebook is an example of the desire to publicize everything. Some people share things we would have thought should be secret, and others keep secret things many share. Customers want the option that best fits them. That’s why both Facebook and Snapchat are successful.
As a consultant for over 25 years, I have clients that contractually prevent me from publicizing our relationship. They don’t want anyone to know which experts they use. Other clients want me to make our relationship (not the details) as public as possible so everyone knows they are working with the best expert available.
Ask your customers their thoughts on secrecy versus public aspects of your products and services. Then determine how best to satisfy that trend. You may well have to provide both options and the ability for your customer to switch between the two.
Examine how your strategy specifically addresses the trends of location independence, user-controlled pull, and secrecy versus sharing. While it’s likely not what you’ve always done, it’s what you need to provide in the future. Otherwise, you’ll be left with empty McMansions.
As published on American City Business Journals