The things that make us care about goods, services, and brands are shifting. It used to be that a successful brand conveyed authority and reliability (think General Motors or IBM); now it’s all about empathy. Technology used to attract us through specs and features; today it has to enable an experience. Even our perception of what makes a product valuable has shifted, to the point where a brand-new sound system or a dress like the one on the magazine cover is actually less desirable than something with a strong story attached. That can take many forms: a revived speaker from the ‘80s, a box of mystery items curated by a favorite brand, or an outfit chosen with the help of a trusted expert. It’s these stories—coupled with basic functionality that’s absolutely dialed in—that win people over in the long run. Here, we look at the innovation stories of eight key brands and reveal what, exactly, they got right in 2013—and what you can learn from them in 2014.
Sometimes the biggest upheavals come from the simplest places, like fixing an experience that everyone knows is broken. Even relatively small companies can manage to shake up very large categories, not by introducing a completely new product or service, but by optimizing what was already there.
The outcome of using a Nest thermostat, the home-monitoring device developed by a pair of former Apple engineers, isn’t really any different from that of thermostats from 50 years ago. Despite its sleek, iPod-like appearance and array of sensors, the puck-shaped device is still just a way to control temperature. Yet its intuitive interface and predictive algorithms have made it both a design phenomenon and a huge commercial success, selling around 50,000 units per month throughout the year, and prompting Google to lay down more than $3 billion to purchase the company outright. Nest estimates that almost 1% of all U.S. homes have installed one of their thermostats by now, and the company's newer but equally well-designed smoke detector is showing similar numbers.
Next-wave taxi service Uber, once the domain of tech-savvy San Franciscans, is now in nearly 70 cities, showing urbanites everywhere that hailing a cab can be predictable, civil, and comfortable. With global growth exceeding 20% per month, and total annual fares topping $100 million per city, Uber is being held up as Silicon Valley’s most exciting company, prompting some more enthusiastic analysts to predict it will soon be more valuable than Facebook. Not bad for a service that essentially replicates what taxi companies have been doing for a century—but does it better.
Subscription services have been around forever, primarily for print and online publications, and less commonly for food, consumables, and physical goods. One model that really blew up in 2013 is the brand-based product subscription service.
Birchbox and Quarterly.co
Birchbox, a company that sends out monthly boxes of beauty and grooming supplies, claims more than 400,000 regular subscribers just three years after launch. Its European sister site Glossybox grew to similar popularity in an even shorter period of time. More recently, Quarterly.co has taken the subscription concept a step further, delivering products every three months picked by a range of curators, including style expert Nina Garcia and Make Magazine founder Mark Frauenfelder, or brands like quirky L.A.-based Poketo.
What’s remarkable about these, and dozens of other product subscription services is that they’ve convinced people to lay down serious money—sometimes several hundred dollars a year—for goods that someone else is choosing, which runs counter to the customer-is-in-control mantra we so often hear. The thrill of discovery is part of the appeal, but there’s also the thrill of not having to decide: when you’re bogged down by decision fatigue, latching onto a person or brand whose choices you trust can feel like liberation. Even if you have no use for a box of candy-colored paper straws.
The recent proliferation of makerspaces, hackathons, and DIY-oriented events like Maker Faire suggests that repairing and repurposing are being actively embraced as mainstream pursuits—not just a way to be frugal, but a form of expression and creativity. At the same time, we see increasing evidence of analog technology’s appeal, even when it’s driven by digital media, as evidenced by the wild popularity of Instagram and the continued growth of the vinyl record industry. Today's smartest brands know how to leverage both the power of analog and our desire to channel our inner handyman.
The Vamp is a device that resurrects dead speakers, which isn’t as strange as it sounds. Essentially a small, battery-powered amp with Bluetooth reception, the cube-shaped Vamp is designed to sit on top of an old speaker and feed the speaker signals received from your smartphone or laptop. The device’s Kickstarter video features its designer, London-based Paul Cocksedge, professing his love for old, boxy audio gear, and appealing to the hacker and tinker in us all, as well as that jolt of eco-satisfaction we all get when rescuing something from the garbage heap. The campaign has been an unqualified success, raising three times its initial funding goal.
It's all too easy for tech companies to mindlessly chase superlatives—to try to best competitors with the fastest processor or the highest-resolution display. The thing is, most consumers don't really care. As we wrote earlier this year, "The Internet runs on an alphabet soup of languages and protocols, and only a slim population of early adopters count pixels or processor speeds anymore. The rest of us just want to know what it’s like to use."
The Motorola/Google partnership that produced the Moto X smartphone is remarkable for several reasons, including the phone’s "always on" voice recognition, the unique Motomaker interface that allows shoppers to customize it before ordering, and the fact that it’s assembled in the United States. But one of its most striking features is what it doesn’t have: an ultra-high-res display.
Just three years earlier, Apple wowed the technology world by doubling the resolution on the iPhone 4, calling the result "Retina display." Digital cameras experienced a similar trend in the early 2000s, with manufacturers racing to cram in more and more megapixels, until image sizes became gargantuan, tech writers started to rebel, and manufacturers began to rein in their resolutions. Yet when the Moto X was released last year with a resolution of "only" 1280 x 720 pixels, critics were quick to call it out as a liability when held up to higher-res competitors like the HTC One or Samsung’s Galaxy S4.
The critics may have been surprised that Moto X’s display didn’t seem to impact sales at all, or that when the iPhone 5 came out the following month, it boasted the same 1280 x 720 resolution. Moto X also drew heat for using dual core processors, dismissed by some as "last year’s technology," yet reviewers have been quick to point out that actually using the smartphone is a genuine pleasure, not because it revs faster, but because its interactions are so thoughtfully designed. The phone’s sales numbers have been solid, if not stunning, helping to revive a once-dismissed mobile brand, and setting the stage for a resurgence in Motorola-built Android phones—including the current darling of the category, the Droid Maxx. For consumers, these developments suggest that GHz, DPI, and other metrics are increasingly taking a back seat to user experience.
Everyone loves a good story. Even long-established brands, which generally don't spring to consumers' minds as new and now, can sweeten their offerings by infusing their brands with a compelling narrative. A generic brand can differentiate itself by telling a story that emphasizes human interaction.
J. Crew has been around since the early ‘80s, but has recently entered something of a design-driven golden age, that’s seen its revenues more than triple since 2003, and inspired fans to start blogs that do nothing but sing its praises—a far cry from its early days as a preppy alternative to Gap or Banana Republic. A more idiosyncratic, fashion-forward aesthetic played a big part in this, but even more important was J. Crew’s decision to focus on personal service and customer relationships. Case in point: the Very Personal Stylist service, launched in late 2012, which uses in-store tablets to tell detailed video "stories" about various clothing articles to shoppers, and hooks them up with professionals who can put together an outfit or take care of holiday shopping—all free of charge.
Domino’s "Pizza Tracker" infuses the late-night pizza order with story and personality. Besides letting customers place their order online, and create Pizza Profiles to shorten the process, the Tracker graphically charts the progress of your order, tells you exactly what time it left the kitchen, and in some cases even gives you the name of the person who made it. The Tracker also opens up avenues for human interaction, encouraging customers to leave notes for the pizza makers, some of whom develop personal followings. This feeling of being able to chat with the kitchen staff and watch them work is part of the appeal of small, non-chain restaurants; Domino’s has managed to bring it into the most formulaic chain-store food experience imaginable.
If there’s one thing the examples above have in common, it’s that they are acting with the mentality of a small upstart: fast, nimble, and hungry. Some are actual startups, like Vamp; others are large corporations breaking with previous patterns by taking a page from the startup world, like J. Crew and Motorola. We’ve spent the better part of the last decade training ourselves to believe that an existing brand must behave in very specific ways that are "authentic," and that authenticity means not changing. In 2014, they’ll realize that being "on brand" may be the very thing holding them back.
Among big companies wondering where their big innovation in 2014 will come from, the smart ones will realize they need to disrupt themselves before a competitor does it for them. 2014 will be the year when established brands intentionally start acting unlike themselves, rather than acquiring small companies that have what they don’t. Instead of asking "what would (insert founding visionary here) do," they might ask instead what that visionary would do if he or she were starting up the company today.