Watch never-before-seen videos of an amazing new condiment lubricant that makes the inside of bottles so slippery, nothing is left inside. This means no more pounding on the bottom of your ketchup containers--and a lot less wasted food.
When it comes to those last globs of ketchup inevitably stuck to every bottle of Heinz, most people either violently shake the container in hopes of eking out another drop or two, or perform the "secret" trick: smacking the "57" logo on the bottle’s neck. But not MIT PhD candidate Dave Smith. He and a team of mechanical engineers and nano-technologists at the Varanasi Research Group have been held up in an MIT lab for the last two months addressing this common dining problem.
The result? LiquiGlide, a "super slippery" coating made up of nontoxic materials that can be applied to all sorts of food packaging--though ketchup and mayonnaise bottles might just be the substance’s first targets. Condiments may sound like a narrow focus for a group of MIT engineers, but not when you consider the impact it could have on food waste and the packaging industry. Smith says.
"It’s funny: Everyone is always like, 'Why bottles? What’s the big deal?' But then you tell them the market for bottles--just the sauces alone is a $17 billion market. And if all those bottles had our coating, we estimate that we could save about one million tons of food from being thrown out every year."
Check out what happens when you pour ketchup out of a LiquiGlide-coated bottle:
For point of reference, here’s ketchup coming out of a regular bottle. Keep in mind, this is the exact same ketchup. It’s so time-consuming and wasteful.
As Smith describes it,
"LiquiGlide is a surface that’s unique because it’s kind of a structured liquid--it’s rigid like a solid, but it’s lubricated like a liquid."
It works with many types of packaging--glass, plastic--and can be applied in any number of ways, including spraying the coating onto the inside of bottles. Now, thick sauces that would normally move like sludge seem to just fall out of LiquiGlide-coated bottles, as if they were suspended in space. Smith says.
"It just floats right onto the sandwich."
One of the most significant challenges his team faced was making sure the coating was food safe, meaning his team could only work with materials the FDA had approved. Smith says.
"We had a limited amount of materials to pick from. I can’t say what they are, but we’ve patented the hell out of it."
Here’s mayo coming out of the coated bottle:
As opposed to this:
Originally, Smith’s team, which has been working for years now on developing various types of surface coatings, was pursuing different aims. Smith says.
"We were really interested in--and still are--using this coating for anti-icing, or for preventing clogs that form in oil and gas lines, or for non-wetting applications like, say, on windshields. Somehow this sparked the idea of putting it in food bottles. It could be great just for its slippery properties. Plus, most of these other applications have a much longer time to market; we realized we could make this coating for bottles that is pretty much ready. I mean, it is ready."
As you can see.
Ironically, if LiquiGlide is a success, it will just mean Smith has to pound even more bottles of ketchup the old-fashioned way. He still has to perform the annoying task in product demos, to show a comparison between the LiquiGlide-sprayed bottles that work and the traditional bottles that don’t. Smith says, laughing.
"It was never really a personal pain point for me, but I do hate struggling to get sauce out of the bottles. I didn’t know about the tapping of the '57' until I started looking into this. It was all news to me."
MIT PhD candidate Dave Smith and his research team gather around to demonstrate the super on-stick properties of LiquiGlide (Click Image To Enlarge)
But he’s already close to experiencing the sweet taste of victory: Last week, LiquiGlide came in second place, out of 215 teams, in MIT’s $100k Entrepreneurship Competition. His team also took home the audience-choice award.
Smith is now in talks with a few bottle companies to market LiquiGlide, though nothing is official yet. It’s still early. The team hasn’t even come up with its own company name, nor been incorporated yet. And their lab is still a complete mess.
Smith says.
"We have all types of sauces, jellies, and jams everywhere in our lab. It’s like a closet full of condiments."
COMMENTARY: That's what I call a neat invention. The non-stick coatings industry is huge. Ketchup bottles is just the tip of the iceberg. MIT stands to make a bundle from licensing this nanocoating. Come on FDA, approve LiquiGlide--FAST!!
Courtesy of an article dated May 22, 2012 appearing in Fast Company Exist
CATEGORY LEADER SWITCHES TO VALUE MESSAGING AFTER SHICK AND DOLLAR SHAVE CLUB STEAL MARKET SHARE
For a generation, Gillette has been among the most profitable packaged-goods brands, with regular price hikes and market shares north of 80% in the lucrative replacement-blades market.
But as challenges mount from traditional and new rivals and share starts to drop, the Procter & Gamble brand has been shifting its focus toward value messaging.
One of the rivals is Schick Hydro, launched two years ago, about the same time as Gillette's latest system, Fusion ProGlide. In recent months Hydro has added a sharper price edge to digital and direct-mail ads, and has made a superiority claim that would once have seemed unthinkable for a Schick brand heavily outsold by Gillette.
A mailer for Schick Hydro 5 states that it's "Preferred over Fusion ProGlide at a better price," a claim that according to the fine print is based on 52-week Nielsen scanner data and surveys of men considering overall performance and price. (A P&G spokesman said Gillette systems continue to win in numerous internal and external surveys and ratings of razor performance.)
That was followed by a guerrilla challenge from venture-capital-backed Dollar Shave Club, whose viral video drew more than 4 million views its first month. Club founder and co-CEO Michael Dubin asks in the video.
"Do you like spending $20 a month on brand-name razors?"
He adds that "$19 goes to Roger Federer" -- a swipe at the tennis great, who's had viral-video fame himself as a Gillette pitchman.
The direct-response Dollar Shave Club offers twin-blade razors for $1 a month ($3, including shipping and handling), or four- and six-blade models for $6 to $9, shipping and handling included.
Mr. Dubin is a former NBC page, MSNBC news writer, improv comedian and producer of custom video content for advertisers at Time Inc. He got the idea for Dollar Shave Club in 2010, after complaining about the high cost of razors to friend and co-founder Mark Levine, who had experience getting products made in China.
DSC built its concept last year at Science, the Los Angeles digital incubator headed by former MySpace CEO Mike Jones. In December and January the club won $1.1 million in backing from venture-capital firms including Kleiner Perkins, Andreessen Horowitz and Forerunner Partners.
Though Mr. Dubin would not disclose the number of DSC subscribers, it has already surpassed 2012 projections with the 12,000 who joined in the first 48 hours after the video launch. Producing the video cost about $4,500.
Gillette is responding by giving more attention to value, starting with ads last month from BBDO, New York, that show a man using a single Fusion ProGlide cartridge during a five-week trip around the world.
Still in development are plans for marketing support for Gillette's Mach 3 system, against which Schick has made its greatest inroads, said P&G spokesman Damon Jones.
Mr. Jones said.
"You can get Gillette quality at great value no matter how much you want to spend. We haven't talked about value as much as we'd like. That's where Schick and Dollar Shave Club are coming at us. We know we have to be much more competitive in that space."
But that comes at a cost, particularly the expense of bolstering a legacy system such as Mach 3, historically a low-maintenance business that delivered a tidy profit, said Deutsche Bank analyst Bill Schmitz.
Gillette's share of the $820 million replacement-blades market slipped 2.2 points last year, to 80.8%, according to SymphonyIRI data from Deutsche Bank, after holding stable at about 83% since 2004. But Gillette, which probably commands 90% to 95% of category profit, may have no choice but to give margin back to defend turf, Mr. Schmitz said.
The male-grooming business delivered a 20.3% profit margin last year, six points higher than P&G as a whole. Gillette razors are even more profitable, as lower-margin Braun shave-preparation, soap and deodorant products pulled down performance.
Despite the more aggressive value focus in general, Mr. Jones said, the new high-end ProGlide Styler trimmer-razor has done well and helped expand Gillette's profit pool.
COMMENTARY: Gillette Fusion ProGlide is perfect example of an increasing returns business model. They give away the razor handle for free, but charge you a fortune for the blades. It's a great shave, but the blades just cost too much. Most stores sell the blades in special security dispensors and I have seen the razor handles and blades locked glass display cases because they are considered too valuable and can be easily shoplifted if display on regular counter shelves. I do love the Shick Hydro 5 prices, though. That Dolar Shave Club commercial is fucking hillarious, and I think it might be the first one to use the "F" word. I don't think it will get pass the FCC censors, and ever appear on television, but it has over 4 million views on YouTube, so fuck yeah!! Send me those fucking razors.
Courtesy of an article dated April 9, 2012 apparing in Advertising Age
Remember David Edwards, the Harvard professor who gets paid to make zany gadgets like smokable chocolate and plant-based air purifiers--stuff that’s both totally cool and completely useless? He’s back, only this time he’s invented something that might actually come in handy, especially among Red Bull-pounding college kids. Introducing caffeine you inhale.
Aeroshot Pure Energy is a slim, pocket-sized tube that works like an asthma inhaler. Puff gently, and the tube releases a light powder that dissolves instantly in your mouth. Each Aeroshot contains 100 milligrams of caffeine, roughly equivalent to a tall mocha at Starbucks. Unlike a Starbucks mocha, it’s calorie-free, and it won’t give you horrid coffee breath. And unlike your average energy drink, it meets TSA regulations. Though personally, a big jolt of caffeine is the last thing I want when I’m boarding an airplane.
AeroShot will be available in Boston and New York in January.
COMMENTARY: I thought I had heard it all, but a "hit" of caffeine, that according to Aeroshot delivers a quick hit of caffeine anytime, anywhere. Aeroshot is completely transportable so you can get your caffeine hit everywhere you go regardless of the weather. It also meets TSA regulations, so you can take it onboard a plane. Aeroshot is easy to use too: You simply pull the green end to open. Put the other end in your mouth and gently puff in. Each Aeroshot will give you 6-8 puffs of caffeine. You are puffing in a fine powder that falls out of the air and dissolves instantly in your mouth. Then push closed with your hand, and tuck it into your pocket or purse. Each puff of Aeroshot contains 100 mg of caffeine--about the same as a large cup of coffee. Starbucks watch out. You have competition. Maybe Starbucks will buy the company, and market their own Starbucks Aeroshot. Anything is possible. Another useless waste of your money, but there will be people who will buy this.
According to the Aeroshot Pure Energy website, the new product hits stores in New York and Boston in 85 days.
Courtesy of an article dated October 20, 2011 appearing in Fast Company Design
Since arriving in Minnesota from Milan last year, Mauro and his wife, Elisa, can't help but stand out. | Photo by David Bowman
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Meet the audace global design guru who has infused his elegante sensibility into a once-blando $27 billion American conglomerate.
1. Mauro loves his pink lion. One Saturday afternoon last spring, he and his wife, Elisa, front-runners for the title of Minnesota's most glamorous Italian transplants, stumbled onto an eclectic sale in a parking lot on the outskirts of St. Paul. As soon as he saw the white stone statue of a regal lion, Mauro didn't hesitate forking over a few hundred bucks. He knew exactly what he wanted to do with it. He says.
"I painted it fluo [as in fluorescent] pink myself."
And he put it in his front yard for all to see.
Mauro Porcini is the resident design guru at 3M, the materials-science conglomerate based in St. Paul. Throughout the company, he's simply known as Mauro--a renaissance man who's transcended his last name. Although most of his Midwestern colleagues pronounce it MORE-oh, it actually rhymes with WOW-whoa, which is also the typical reaction to the flamingo-colored sculpture that now resides across the street from the Oak Ridge Country Club. The club had been lion-free for 90 years until Mauro moved from Milan in 2010 to Hopkins, a Minneapolis suburb dotted with low-pitch ranch homes like his. "The neighbors stop and take pictures," he says, smiling as he gazes at his yard one night in June. In his mind, Mauro says, the beast roars,
"This house is owned by a designer, someone who likes to think in a different way!"
Mauro Porcini says.
"Everything around you, every product, tells a story about you to the world."
He delights in the shock, both in the color and the juxtaposition, of a sculpture associated with ornate European castles or Italian piazzas transplanted to a straitlaced American suburb. The piece works, he says, because "it's completely out of context."
Like Mauro himself. The stylish and unapologetically passionate 36-year-old designer oozes European panache from every pore of his intensely bronze skin, yet he works at one of the most low-key, unassuming companies in corporate America. 3M has been a quiet innovator by design. Although its 85 R&D labs around the world earn more than 500 patents a year and are responsible for an astounding 75,000 products on the market in such fields as medical devices and consumer electronics, the $27 billion giant is still best known for creating ingenious but utilitarian items such as Post-it Notes, Scotch Tape, and Scotch-Brite Scrub Sponges. Mauro says.
"One of the biggest problems we have as a company is understatement. We're trying to change that."
Mauro is about love--easily his favorite verb, as in "You have to love society and the people you design for"--not specs. He's here to trigger emotion, in customers, colleagues, and 3M partners. To be, as CEO George Buckley says, "an infectious agent" for design. No wonder Mauro's crazy about the statue. He's 3M's hot-pink lion.
2. Mauro loves the first product he designed for 3M. When he joined the company in 2002, it had plenty of industrial designers but no one like the then 26-year-oldprodigio who had made his bones creating goods at Philips and with his own online design outfit. Antonio Pinna Berchet, 3M's head of corporate marketing in Milan, was eager to make its office wares stand out. The company was relying on functional excellence, but Italian consumers value aesthetics. Berchet says.
"We wanted to create more impulse buying with more attractive products. His long-term goal was more institutional. My thinking was design would be part of research and development."
Mauro dresses up at 3M as if it were a Milanese runway. His wardrobe, he says, conveys "creativity and business savvy." | Photo by David Bowman
After just a few months at 3M, Mauro showed the brass that he was bilingual in more than one sense: He can talk business as well as design. (Six Sigma has never sounded so sexy as when Mauro riffs about his love for process.) He convinced the projector team in Austin to let him compete for a redesign that was already under way. He tapped his Milan network and brought in Pininfarina, the Italian firm renowned for its work with Ferrari and Maserati. Mauro's group made the overhead projector striking, with the sleek, inviting lines of a luxury car. Merchet says.
"Always our projectors have been very industrial and very standard. This was absolutely new."
Mauro says.
"You wanted to touch it."
Click Image To Enlarge
What got the attention of pragmatists throughout 3M was the bottom line: Sales doubled. The S10 Multimedia Projector showed what design could do for business.
3. Mauro loves watches. He wears his passion and creativity on his sleeve. Literally. The crazier the watch the better. He has about 30 in current rotation. He'll wear the silver Philippe Starck with a hole in the middle to work, then change into the white Calvin Klein model with a tiny, almost invisible clock face for dinner.
Mauro Porcini says.
"In Milan, you breathe design. I'm trying to bring some of that here."
Click Image To Enlarge
Creating emotion around a purchase is not an abstract concept for Mauro: This is how he shops for watches. At his team's holiday party in the Uptown district of Minneapolis last year, he fell hard for a colleague's iPod Nano watch, designed by Scott Wilson. When Mauro realized there was an Apple store nearby, he led the group on a shopping excursion, where he bought two. He says with a laugh.
"I can buy five [watches] in one week. They grab my stomach."
He has plenty of love to go around. The man owns 65 pairs of shoes. Elisa says.
"I married a monster."
4. Mauro loves the Little Tape Man. "Isn't he great?" he says, cradling an anthropomorphic tape dispenser in the palm of his hand. Dressed in a white Gucci jacket, black V-neck T-shirt, and black pants, Mauro stands in a 3M conference room surrounded by dozens of his team's creations. Safety goggles sporty enough to wear on Milan's fashionable boulevards. Ankle braces with a clever lace-up system. An air purifier that could be mistaken for a pricey vase. Mauro says.
"But the Tape Man is my mascot."
In 2004, 3M executives in Europe asked him to focus on rejuvenating tape dispensers. The novelty of the 1961 invention of transparent Scotch Magic Tape had long since worn off. Mauro says.
"The idea was a product that could almost be animated, living on your high-tech desk. Like a companion."
He brought in Stefano Giovannoni, the Milanese designer who had transmogrified Alessi's kitchen utensils into artful objects worthy of display. Giovannoni's Omino Scotch Tape Dispenser (omino is Italia+n for "little man") is a figure crawling on his stomach. The tape emerges from his head and attaches to his upraised foot. The charming dispenser appeared in design books and exhibits.But it never crawled its way into stores. It even found a home on the desk of Buckley, the CEO, who says,
"It shows how design can differentiate a simple roll of tape. People here were thinking, Oh, we love it, but is there a market big enough for this? The company was not ready for it."
From Masking Tape To Mauro
A sampling of 3M's hits, past and present
Click Image To Enlarge
In the early years, despite the blessing of top management, who gave Mauro the mandate to build a design center in Milan, he often met resistance in the labs. He recalls this without a trace of bitterness. 3M is a 99-year-old bastion of proud left-brain thinkers whose highly rational and technology-driven approach has served it well. He says.
"My biggest roadblock was the lab directors who were in charge of creating new products. Here arrives this young guy from Italy, from the periphery of the 3M empire, and he's telling us how to do innovation?'"
Mark Sorlien, a technical director and 30-year employee, whose plain blue button-down shirt and earnest demeanor evoke a high-school science teacher, was one of the skeptics. He says with his eyes wide with bewilderment.
"At first we thought, What is this guy talking about? Mauro talked about 'what does that mop on the shelf say to the customer when she shops?'
I'm thinking, It's a mop; how much water comes out?"
Although never commercialized, the Little Tape Man, along with other early designs, ultimately succeeded. Mauro says of the rejections.
"They helped to shake the system. They showed the direction we needed to go."
The failures helped pave the way for a crop of playful items, including a high-heel tape dispenser, Elisa's favorite, and an apple Post-it dispenser used by Buckley. He says.
"It's a dispenser, for goodness sakes, but there's no reason why it shouldn't be beautiful."
These creative designs have sold well. As Joe Harlan, executive vice president of 3M's $3.8 billion consumer and office business that bankrolls most of Mauro's work, says,
"Once you start adding value, resistance goes away."
5. Mauro loves his house. From the lawn ornaments to its interior, Mauro's home embodies his design sensibility. Robyn Waters, the former Target design chief and a recent dinner guest says.
"You walk in and your jaw drops."
Mauro tore down the kitchen, living room, and den walls, transforming a predictable ranch-style floor plan into an open, modern, and whimsical space. Everywhere you look, he has added seemingly incongruous elements that meld together: a Frank Gehry cardboard chair; a Madonna and Child painting by his father, an architect; a spotted goat pelt (from Elisa's days as a designer at Gucci); a delicate glassblown bird on a shelf tilted at a precarious angle. The coup de grace, though, may be the master bathroom, with a two-seater Jacuzzi that fills from a spout in the ceiling. He turns on the water, marveling at the long, thin column of liquid. He says.
"Don't you just love that?"
Twice a week or so, Mauro and his wife have guests over for dinner, just as they did in Milan--3M'ers, local designers, or out-of-town friends passing through. One night in June, he opens the door, having changed from his office attire into a definitely NSFW open-collared white shirt unbuttoned halfway down his chest. Before you know it, you're sipping prosecco with Grand Marnier and pureed pear and noshing on Elisa's exquisite appetizer spread of bruschetta caprese, Pizza Margherita, and Italian chicken salad. For dinner: wild mushroom agnolotti with a porcini (of course) cream sauce, topped with Parmigiano-Reggiano. Mauro says, breaking out the Barolo he brought from Milan in his suitcase.
"I starve when Elisa is not in town."
This fall, he will throw open the doors to 3M's new design center in St. Paul. Much like his home, it is meant to entice. He says.
"People will see this intriguing space and want to visit."
A couple of years ago, in an effort to further integrate design at 3M, Mauro proposed building the company's design hub at headquarters--and moving from Milan to the U.S. to run it. He says.
"In Milan, you breathe design. I'm trying to bring some of that here."
As he walked through the unfinished space last summer, wearing pink pants, pink socks, and a black custom-tailored Italian jacket, Mauro could already see the center humming with designers. A river of fuchsia winding along the carpet from the entrance will usher people into offices that will look dramatically different from the muted colors and tall cubicles that pervade the 3M campus. He says matter-of-factly.
"The project rooms will have grass."
Artificial grass. Lawn furniture. And the floor by the kitchen area will be white tiles. Mauro loves white (see his iPhone, his watch, the bleached wood floors in his house). He has sent the tiles back four times already because they weren't right. That sort of perfectionism would normally cause ripples, but he has enough goodwill banked to get away with it.
And his influence is growing. He's the head of global strategic design in the consumer and office unit, but his work extends to other divisions. Buckley says 3M is spending five times more on design than five years ago. And Mauro's 50-member group is becoming more global, adding designers in China and Japan. Brazil is next.
6. Mauro loves 3M's new touch-screen technology. He didn't design it, but he's helping to promote it. 3M has 46 core technologies--adhesives to abrasives, films to finishes--which it uses to seed products across various industries. A lot of the materials go inside other companies' offerings. (In fact, the average cell phone can contain a dozen 3M components: materials that brighten the screen, seal against water, help bond metal and plastic parts, and provide shock absorption.) Mauro says.
"For a designer, 3M is like a candy store."
From top to bottom: The new design center at 3M headquarters; imagining uses for a new touch-screen tech; 3M's Hoop Light; his Philippe Starck watch; his renovated home.
But much of this technology is invisible to the eye, which begs the question, Where does design fit in? Mauro says.
"We're helping our customers envision the innovation."
For 3M's ultrathin, flexible, and transparent touch-screen technology, which can respond to multiple simultaneous touches, his team and the R&D lab imagined several potential applications. A curved video-game player. A touch-screen bracelet. A washing machine with touch-screen controls on the glass door. The designers then produced a video that 3M shares with consumer-electronics manufacturers as part of what Lee Fain, the project's design manager, calls "design provocation."
Designers, Mauro says, are good storytellers. At 3M, they're charged with telling the story of a product not only to consumers but, increasingly, to the companies it supplies as well. He says.
"In consumer electronics, you use design or you die. In a company like this, it's less obvious that design is needed, but it is."
7. Mauro loves his Breakfast at Tiffany's poster. The iconic image of Audrey Hepburn in a sleeveless black dress, long black gloves, and strands of pearls hangs on the wall overlooking his desk. Pure elegance, perhaps Mauro's second-favorite word. He says.
"Whenever I interview someone, I ask, What's your definition of elegance?"
Mauro defines elegance as consisting of simplicity and balance--"like jazz," he says--concepts he expounds on continually within 3M. Berchet says.
"He's started a sort of design school inside 3M. He's teaching others the right approach."
Sorlien, the once-skeptical 3M technical director and mechanical engineer, is now "a coconspirator," Mauro says. Sorlien worked with the design team on a new filtered-water pitcher that takes up minimal space in the refrigerator yet has a nifty fast-flow filter, based on preexisting 3M technology. Sorlien says as a shorthand explanation for how he's not a designer.
"I'm an Iowa guy."
But he's undeniably proud of how, well, elegant the pitcher is. He says, admiring the superslim profile--and the fact that it holds more water than the previous rounder version.
"If you'd have given me 10 years, I'd never have come up with this. What Mauro and his designers helped us with is form plus function."
8. Mauro loves the Hoop Light. A couple of years ago, he was part of a three-day brainstorm looking at 3M's lighting technology in hopes of creating a business that could target a higher-end market of architects and interior designers. The Hoop Light that emerged from the new business is unlike anything previously created by 3M. At 9 feet in diameter, the fixture looks like the base of a chandelier minus the fancy lights. Inside the slender band are LEDs and reflective films and filters that spread the light out, creating an even glow. The piece can also change colors, altering the mood of a room. Suspended from thin cables, it floats like a halo.
Click Image To Enlarge
The Hoop Light, along with a slew of other chic creations, is getting the company noticed in design circles as never before. Last spring, 3M participated in the Milan Furniture Fair, the largest furniture trade show in the world, a coming-out party that Mauro had anticipated for years. Working with local designers, his team put together a showcase that married 3M engineering and its emerging design focus. A flexible adhesive mat dotted with lights can be attached to walls or sculpted into a curving wall of light. The Sunlight Delivery System collects natural light from the roof and distributes it to windowless areas of a building through a sort of plumbing network. The exhibit offered a captivating experience in lieu of a straightforward sales pitch. Matthieu Aquino, the design manager in Milan who spent a year preparing for the fair says.
Click Image To Enlarge
"We didn't go into much detail about the technology. It was very different for 3M."
Mauro Porcini says.
"Whenever I interview someone, I ask, What's your definition of elegance?"
The new business, architectural markets, has one of Mauro's designers on board. He's involved in shaping products, marketing, and the business plan from the start. Another first at 3M--and the kind of integration that Mauro had envisioned early on and is eager to replicate.
9. Mauro loves his bobblehead. It's a suave little doll, a mini-Mauro in a brown leather jacket, matching brown shoes, and a black shirt. Mauro displays it on his desk because it was a gift from a 3M leadership event last February. Each of the managers got one. To Mauro, the figure is another sign that he's become part of the leadership team and that 3M's blue-button-down brigade accepts him. Waters, the ex-Target exec says.
"Mauro's making it okay to talk about and be passionate about love, soul, and the customer experience, not just about technicalities and business plans, although he can talk about those too."
In the consumer and business unit, says Harlan, design is the key to differentiating 3M's products, its packaging, and even its store displays in an increasingly crowded market: "The strategy is to get design throughout the organization, and Mauro's the guy."
For all the outward differences between Mauro and 3M (his dark gray Porsche pops in the sea of sedans in the parking lot), he focuses on the similarities. He says of his colleagues.
"They're design thinkers. We're just waking up something that was already here."
The designer's goal, as he explained to graduates at the University of Minnesota's College of Design last spring, is not customer satisfaction. That's a terribly low bar. You're just meeting someone's needs. If you're a designer who loves your customers, "you surprise," He said.
"You enter the sacred field of the magic, of the extraordinary, of the memorable."
For Mauro, that's amore.
COMMENTARY: 3M Company (NYSE: MMM), formerly known as the Minnesota Mining and Manufacturing Company, is an American multinational conglomerate corporation based in Maplewood, Minnesota.
3M has nine sales offices in eight states and operates 74 manufacturing facilities in 27 states. Internationally, 3M has 148 sales offices. The Company operates 93 manufacturing and converting facilities in 32 countries outside the United States.
With over 80,000 employees, they produce more than 55,000 products, including: office products, home & leisure products, adhesives, abrasives, laminates, passive fire protection, dental products, electronic materials, architectural products, displays & graphics products, medical products, safety & security products, car care products (such as sun films, polish, wax, car shampoo, treatment for the exterior, interior and the under chassis rust protection), electronic circuits and optical films.
3M has operations in more than 60 countries – 29 international companies with manufacturing operations, and 35 with laboratories. 3M products are available for purchase through distributors and retailers in more than 200 countries, and many 3M products are available online directly from the company.
I am totally amazed at the broad variety of products the 3M has created and distributes throughout the world. These are products whose brand names we are familiar with, but are not aware are produced by 3M.
Courtesy of an article dated October 1, 2011 appearing in Fast Company
For generations, Procter & Gamble Co.'s growth strategy was focused on developing household staples for the vast American middle class.
Now, P&G executives say many of its former middle-market shoppers are trading down to lower-priced goods—widening the pools of have and have-not consumers at the expense of the middle.
That's forced P&G, which estimates it has at least one product in 98% of American households, to fundamentally change the way it develops and sells its goods. For the first time in 38 years, for example, the company launched a new dish soap in the U.S. at a bargain price.
P&G's roll out of Gain dish soap says a lot about the health of the American middle class: The world's largest maker of consumer products is now betting that the squeeze on middle America will be long lasting.
Melanie Healey, group president of P&G's North America business says.
"It's required us to think differently about our product portfolio and how to please the high-end and lower-end markets. That's frankly where a lot of the growth is happening."
In the wake of the worst recession in 50 years, there's little doubt that the American middle class—the 40% of households with annual incomes between $50,000 and $140,000 a year—is in distress. Even before the recession, incomes of American middle-class families weren't keeping up with inflation, especially with the rising costs of what are considered the essential ingredients of middle-class life—college education, health care and housing. In 2009, the income of the median family, the one smack in the middle of the middle, was lower, adjusted for inflation, than in 1998, the Census Bureau says.
COLLAPSE OF THE MIDDLE CLASS
The slumping stock market and collapse in housing prices have also hit middle-class Americans. At the end of March, Americans had $6.1 trillion in equity in their houses—the value of the house minus mortgages—half the 2006 level, according to the Federal Reserve. Economist Edward Wolff of New York University estimates that the net worth—household assets minus debts—of the middle fifth of American households grew by 2.4% a year between 2001 and 2007 and plunged by 26.2% in the following two years.
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HOW P&G AND OTHER COMPANIES ARE MAKING THE ADJUSTMENT
P&G isn't the only company adjusting its business. A wide swath of American companies is convinced that the consumer market is bifurcating into high and low ends and eroding in the middle. They have begun to alter the way they research, develop and market their products.
H.J. Heinz Co., the food giant for example, is developing more products at lower price ranges.
Saks Inc. the luxury retailer is bolstering its high-end apparel and accessories because its wealthiest customers—not those drawn to entry-level items—are driving the chain's growth.
THE CONSUMER HOURGLASS THEORY
Citigroup calls the phenomenon the "Consumer Hourglass Theory" and since 2009 has urged investors to focus on companies best positioned to cater to the highest-income and lowest-income consumers.
It created an index of 25 companies, including Estée Lauder Cos. and Saks at the top of the hourglass and Family Dollar Stores Inc. and Kellogg Co. at the bottom. The index posted a 56.5% return for investors from its inception on Dec. 10, 2009, through Sept. 1, 2011. Over the same period, the Dow Jones Industrial Average returned 11%.
Citigroup analyst Deborah Weinswig explains.
"Companies have thought that if you're in the middle, you're safe. But that's not where the consumer is any more—the consumer hourglass is more pronounced now than ever."
Companies like Tiffany & Co., Coach Inc. and Neiman Marcus Group Inc., which cater to the wealthy, racked up outsize sales last Christmas and continue to post strong sales.
Tiffany says its lower-priced silver baubles, once a favorite of middle-class shoppers craving a small token from the storied jeweler, are now its weakest sellers in the U.S. Tiffany Chief Operating Officer James Fernandez said in June.
"I think that there's probably more separation of affluence in the U.S."
Firms catering to low-income consumers, such as Dollar General Corp., also are posting gains, boosted by formerly middle-class families facing shrunken budgets. Dollar stores garnered steady sales increases in recent years, easily outpacing mainstream counterparts like Target Corp. and Wal-Mart Stores Inc., which typically are more expensive.
P&G's profits boomed with the increasing affluence of middle-class households in the post-World War II economy. As masses of housewives set up their new suburban homes, P&G marketers pledged that Tide detergent delivered cleaner clothes, Mr. Clean made floors shinier and Crest toothpaste fought off more cavities. In the decades since, new features like fragrances or ingredient and packaging enhancements kept P&G's growth robust.
CHANGES IN CONSUMER BUYING HABITS
Despite its aggressive expansion around the world, P&G still needs to win over a healthy percentage of the American population, because the U.S. market remains its biggest and most profitable. In the fiscal year ended June 30, the U.S. delivered about 37% of P&G's $82.6 billion in annual sales and an estimated 60% of its $11.8 billion in profit. P&G says that Americans per capita spend about $96 a year on its products, compared with around $4 in China.
During the early stages of the recession, P&G executives defended its long-time approach of making best-in-class products and charging a premium, expecting middle-class Americans to pay up.
But cash-strapped shoppers, P&G learned, aren't as willing to splurge on household staples with extra features. Droves of consumers started switching to cheaper brands, slowing P&G's sales and profit gains and denting its dominant market share positions.
In late 2008, unit sales gains of P&G's cheaper brands began outpacing its more expensive lines despite receiving far less advertising. As the recession wore on, U.S. market-share gains for P&G's cheaper Luvs diapers and Gain detergent increased faster than its premium-priced Pampers and Tide brands.
At the same time, lower-priced competitors nabbed market share from some of P&G's biggest brands.
Bounce - P&G's dominant fabric-softener sheets business, including its Bounce brand, fell five percentage points to 60.2% of the market as lower-priced options from Sun Products Corp. and private-label brands picked up sales from the second quarter of 2008 through May 2011, according to a Deutsche Bank analysis of data from market-research firm SymphonyIRI.
Tide - P&G's grasp of the liquid laundry detergent category, led by its iconic Tide brand, also posted a rare slip over the same period as bargain-priced options from Sun and Church & Dwight Co. gained momentum.
Gillette - Even the company's huge Gillette refill razor market suffered, declining to 80.1% by May from 82.3% in the second-quarter of 2008, as Energizer Holdings Inc.'s less-expensive Schick brand gained nearly three points.
P&G CHANGES COURSE
P&G began changing course in May 2009. After issuing a sharply lower-than-expected earnings forecast for the company's 2010 fiscal year, then-CEO A.G. Lafley said the company would take a "surgical" approach to cutting prices on some products and develop more lower-priced goods. Mr. Lafley said.
"You have to see reality as it is."
When the company's 2009 fiscal year ended a month later, P&G's sales had posted a rare drop, falling 3% to $76.7 billion.
In August that year, P&G's newly appointed CEO, company veteran Robert McDonald, accelerated the new approach of developing products for high- and low-income consumers.
Mr. McDonald said in September 2009.
"We're going to do this both by tiering our portfolio up in terms of value as well as tiering our portfolio down."
THE GINI INDEX SAYS IT ALL
To monitor the evolving American consumer market, P&G executives study the Gini Index, a widely accepted measure of income inequality that ranges from zero, when everyone earns the same amount, to one, when all income goes to only one person. In 2009, the most recent calculation available, the Gini coefficient totaled 0.468, a 20% rise in income disparity over the past 40 years, according to the U.S. Census Bureau.
Phyllis Jackson, P&G's vice president of consumer market knowledge for North America says.
"We now have a Gini index similar to the Philippines and Mexico—you'd never have imagined that. I don't think we've typically thought about America as a country with big income gaps to this extent."
HOW P&G'S TARGETS THE NEWLY DIVIDED AMERICAN MARKET
Over the past two years, P&G has accelerated its research, product-development and marketing approach to target the newly divided American market.
Globally, P&G divides consumers into three income groups.
"Ones" - The highest-earning "ones" historically have been the primary bracket P&G chased in the U.S. as they are the least price sensitive and most swayed by claims of superior product performance.
"Twos" - The "twos," or lower-income American consumers, have grew in size during the Great Recession. Consequently, P&G decided to target them aggressively, too.
"Threes" - P&G doesn't specifically target the "threes", the lowest wage earners in the U.S., since they comprise a small percentage of the population and such consumers are typically heavily subsidized by government aid.
At the high end, it launched its most-expensive skin-care regimen, Olay Pro-X in 2009, which includes a starter kit costing around $60. Previously, the Olay line had topped out around $25. Last year, the company launched Gillette Fusion ProGlide razors at a price of $10 to $12, a premium to Gillette Fusion razors, which sell for $8 to $10, and Gillette Mach3, priced at $8 to $9.
At the lower end, its new Gain dish soap, launched last year, can sell for about half per ounce of the company's premium Dawn Hand Renewal dish soap, which hit stores in late 2008.
Developing products that squarely target the high and low is proving difficult for a company long accustomed to aiming for a giant, mainstream group.
Conquering the high end is difficult because it usually involves a smaller quantity of products.
Bruce Brown, P&G's chief technology officer said.
"We do big volumes of things really well. Things that are smaller quantities, with high appeal, we're learning how to do that."
Likewise, the cost challenges at the bottom of the pyramid are also proving difficult, Mr. Brown said. Over the past two years, P&G has increased its research of the growing ranks of low-income American households.
Ms. Jackson says.
"This has been the most humbling aspect of our jobs. The numbers of Middle America have been shrinking because people have been getting hurt so badly economically that they've been falling into lower income."
COMMENTARY: A growing cadre of economists have chronicled the steady decline of the middle class, and a corresponding loss of its massive buying power. Charles Hugh Smith, in an article for Business Insider, provides the following disturbing forensic evidence for the disappearance of the middle class, at least in terms of wealth.
The top 20% of the American populace holds roughly 93% of the country's financial wealth.
The top 1% of the country holds approximately 43% of the money in the U.S.
The middle 20% of the population -- what would, officially, be called the middle class -- holds only 6% of the country's total assets.
The bottom 40% of the country controls less than 1% of America's wealth.
What Constitutes Middle Class
According to Smith, what income defines "middle class" is a function of locale and prevailing wages/costs ($100,000 in Manhattan or San Francisco isn't much because costs are so high), but in terms of purchasing power it can be generally agreed that middle class includes:
Ownership of one or more reliable vehicles.
Homeownership with meaningful equity.
Healthcare insurance coverage.
A 401(k) retirement fund of some sort.
A college education/higher education or training.
By these measures, the middle class comprises at best 20% of the populace.
America's Widening Income Disparity
Barry Ritholtz of the Big Picture blog recently published a chart which depicts the actual distribution of wealth in America and the perceived distribution of wealth--what people estimate based on their knowledge.
G. William Domhoff of "Of Two Minds" created this chart that correlates almost exactly with Barry Ritholtz chart above.
The first chart depicts total wealth, which includes depreciating assets that are illiquid (SUVs, boats, furniture, etc.) and typically overvalued. In terms of financial wealth, the top 20% own fully 93% of all assets.
If we characterize the top 20% as "wealthy," then the next 20% would be the "upper middle class" (60% -80%) and the third quintile (60% - 40%) would be "middle class."
"In terms of financial wealth, the Great Middle Class owns a mere 6% of total assets."
The "Ones" have always been the "sweet spot" of P&G's target market. The collapse of the middle class has changed the whole equation. P&G has been forced to introduce products to fill the needs of the ever growing "Twos" and "Threes", the two markets it has largely ignored through its long history.
The Collapse of Household Income
Clearly, middle class Americans are holding a fantasy-view of their piece of the American Dream. A number of people I know consider themselves middle-class based on their substantial income--but they own very few financial/liquid assets, and if they lose their jobs then their health coverage vanishes.
When the average "middle class" American looks at the below chart, they probably reckon this enormous rise in net wealth includes them. But as we have seen above, it doesn't; their "ownership" of this vastly increased wealth is a meager 6%. In other words, the vast majority of this increase flowed to the top 20%.
The Causes Of The Middle Class Collapse
So how did the middle class become second class citizens -- or, as Smith puts it, "Debt Serfs"?
Not surprisingly, the answer is complicated, involving factors like the rising cost of education, the loss of pension funds and affordable health care, falling middle class wages, and the skyrocketing price of housing.
Yet one clear and daunting answer lies in manufacturing.
"When looking at the declining American middle class, a good number to start with is 42,400. That's the total number of factories that the U.S. lost between 2001 and the end of 2009. Put another way, this translates into the outsourcing of 32% of all manufacturing jobs in America."
The loss of manufacturing jobs has left a massive job drain.
At the end of 2009, 15.7 million people were unemployed, while 12.6 million-- 20% fewer -- worked in manufacturing. This represented only 9% of the American working populace; at manufacturing's height in 1960, 29% of Americans were employed in the sector. By the way, as of August 2011, the unemployment rate stood at 9.2% and there were still 15 million unemployed Americans.
This bleeding of American manufacturing represents a massive drop in the products that are made in America.
According to one economist, the country currently doesn't produce any television sets. Computer manufacturing in the U.S. employs about 166,000 people; in1975, it employed almost 300,000. Meanwhile, Asia's computer manufacturing sector has about 1.5 million workers and a single tech manufacturer, Foxconn, employs more than 800,000 people. NOTE: In a blog post dated October 23, 2010, I profiled Foxconn, the Chinese company that manufactures all of Apple's products: iPod, iPhone and iPad. Foxconn is quite literally a gulag or slave labor camp, with corrupt management, lack of workers rights, and appalling work conditions that has led to a dozen worker suicides at one of its plants. Take this into account when you buy one of Job's magical devices.
If the middle class is to rise to anything approaching its former power, American manufacturing must rebound. While the U.S. is still in the upper ranks of the world's largest consumers, its economy is rapidly slipping down on the global list. According to some economists, China's economy is on track to overtake the U.S. by 2040; ten years later, India will also outstrip America. Economic strength requires a strong manufacturing base, but while Asian countries are building theirs, America has slowly allowed its own base to starve.
Computerization - Faster computers, the internet, software productivity tools and applications).
Globalization - Outsourcing jobs to countries where labor is cheaper, especially NAFTA)
Industry consolidation - Mergers and acquisitions due to relaxation of deregulation, elimination of unionization and competititive forces) .
I also identify the destruction of America's manufacturing base as one of the key reasons why America's unemployment rate continues to remain high.
How well did some of Citigroup's 25 companies included in its Consumer Hourglass Theory do with the actual performance of the actual companies? According, Stores Magazine's Top 10 retailers by total sales they were dead-on:
In conclusion, P&G and many other American consumer products manufacturer's are going to quickly realize (or have already realized) that structural changes in the American economy will permanently affect their business. The middle class, the core customer base for many of these companies, has been destroyed to the point where their basic businesss models will have to be changed permanently.
American manufacturer's cannot depend on the upper class to buy their goods. Products, prices and package sizes will have to be rethought. Upper class consumers can not fill the void left by the middle class. The principal reason why I say this: There simply are not enough upper class consumers to buy their products. This is the main reason why many American manufacturer's are moving their production overseas to meet the new demand of growing economies like China, India, Brazil and Indonesia.
The movement of production from the U.S. overseas will worsen the present unemployment situation, resulting in a further erosion of the middle class, making the destrution of the middle class complete.
Courtesy of an article dated September 12, 2011 appearing in The Wall Street Journal, an article dated October 17, 2010 appearing in Daily Finance, an article dated October 12, 2010 appearing in Business Insider and an article dated July 18, 2011 appearing in Forbes
In order to get customers to advocate for your brand, you must exceed their expectations.
Achieving the buzz that product designers, brand managers, and business strategists so relentlessly chase isn’t easy. The key is in getting consumers to adopt and advocate a brand. But how do companies convince customers not only to use their products but to adopt their brands? What makes consumers advocate for a product and willingly accept and “own” it as part of their individual identities? How do you get people so revved up that they’re willing to slap a sticker on their car out of allegiance to the company, or tattoo their bodies with your brand, as Harley owners frequently do?
Adoption
Adoption goes well beyond trial and use, the objective of many product managers and marketers. If a consumer is going to become loyal to a brand, she has to be truly satisfied and impressed. To reach the adoption and advocacy threshold, a product or experience must surpass expectations, which happen to be growing more sophisticated and demanding over time -- on a monthly basis in some industries. Expectations are a tricky thing and can only be truly understood after first identifying the needs and aspirations of the target audience. Needs can be relatively easy to address by developing user benefits and ensuring that a product is useful. However, determining aspirations and fulfilling them is best accomplished by inquiry, observation, and translation.
A good shorthand rule I’ve learned is that only products that have true meaningful value for consumers hold the potential for rapid adoption. Meaningful value is a subjective thing, varying among individuals and groups, but it is generally based on having one’s needs or aspirations met, factoring in the value offered by alternative products and customers’ expectations about the future. This is not to say that people can always articulate their needs and aspirations, especially in areas of new technology, but an assessment of consumers’ ability and willingness to adopt must be gauged alongside their motivations for doing so and their expectations of how the market will look in the future. Because if "armchair expectations" are that 3-D TV prices will halve in 18 months, many will hold off on buying one, despite their desire to have one.
It is also important to remember the following about adoption:
Both internal motivations (needs, aspirations, and idealized self-image) and external ones (concern over others’ perceptions and the universal need for social acceptance) are factors in whether a consumer falls in love with a product.
Adoption is like high school: What really matters is what the cool kids think. Even in adulthood, popular and trusted tastemakers (e.g., celebrities) influence adoption and advocacy. The good news is that a bull's-eye hit with key influencers will reverberate through the widening circles, so long as the product maintains its credibility.
When a product or experience enriches the intended user at every stage of interaction, emotional bonds are built, which lead to loyalty and brand relationships.
Advocacy
For a very long time, I’ve championed the belief that ultimately it’s not how you feel about a design or experience but how the design makes you feel about yourself, in large part because influencing how one feels after adopting a product is an essential component of the advocacy process. Adoption certainly precedes advocacy, but often the latter never materializes. Many who find a solution ideal for their lives fail to spread the news. Why?
Advocacy from a modern product or experience standpoint is like attaching one’s own brand to the discovery, which generally happens when a meaningful improvement or benefit is realized and the advocate wants to help others achieve the same discovery. Conversely, if a customer extremely disappointed, you’ll also get advocacy, in this case against the brand. Again, it is a function of expectations -- both disappointment and joy -- and, therefore, understanding and managing them is the underlying objective. To drive people to action and advocacy, expectation must often be shattered, not merely surpassed. Needs and aspirations again inform those expectations and should be the root of study. If you still have doubts, ask yourself why Southwest regularly tops airline satisfaction surveys over competitors who offer more dynamic levels of service. It has managed expectations and aligned them with service aspects that its customer base finds most valuable, which translates to satisfaction -- and often to advocacy. The reality is that on shorter routes, people are willing to forgo personalized service for a lower-priced ticket.
Southwest Airlines, Coca-Cola, Harley-Davidson, and Best Western have all achieved impressive levels of consumer adoption and advocacy by creating brands that are reliable and valued, and that convey a sense of community. These aspects provide the basis for leveraging advocacy, which each organization then encourages and supports through various programs and tools. Best Western, the world’s largest hotel chain, with more than 4,000 independent operators in 90 countries, is a leader in guest satisfaction for midscale hotels. Why? The success is due in large part to the time and energy spent discovering insights into what guests most desire, then training staff to exceed guests’ expectations in both service and room product. The hotel chain’s "I Care 2" guest-service program continues to increase customer satisfaction across North America. And when people feel understood, appreciated, and rewarded, advocacy is born.
Another reason why advocacy often fails to materialize is that adopters are insufficiently motivated to share. The most powerful motivations to do so derive from self-interest, mutual benefit, and altruism, and there are great examples of each driving advocacy. In my experience, personal benefits are the most motivating, and they don’t necessarily have to take tangible forms: By sharing, people may feel tremendously appreciated, especially knowledgeable, well-connected, or even heroic. Insights derived from people’s underlying motivations help to deliver advocacy.
Finally, for adopters to be truly willing to recommend a brand or experience, typically to people they care about, two things are required. First, there must be a strong level of emotional engagement, and second, they must feel their identification strongly represented or actualized (Does it complete me, or the "me" I wish I were?). Delivering these two aspects -- emotional engagement and identification -- can be the most reliable and straightforward way to compel advocacy.
COMMENTARY: Here are a couple of brand absolutes:
Loyalty is absolutely driven by emotion.
Consumers are looking for emotional connections -- more than ever before.
The 14th Annual Loyalty Leaders list gives the loyalty rankings for the 501 brands we assessed in 71 industry categories in the 2010 Brand Keys Customer Loyalty Engagement Index. Did your favorite brands make the list?
When I started my candle-making company, Chesapeake Bay Candle, we quickly landed distribution deals with over 3,000 boutiques and department stores. But I wanted to move up to larger chain stores. My next goal was to bring in the big fish in the home décor market: a distribution deal with Target. So I embarked on a quest to land the contract.
The process led to literally dozens of rejections from their top candle buyer. But now Target is responsible for over $8 million of our annual sales. The lesson I learned? Sometimes single-minded vision — even obsession — is more important than business protocol or even careful planning.
Brushing off rejection
My husband and I launched our company in 1994. We focused on contemporary and elegant merchandise that would serve as an alternative to the “country” style that was popular at the time. I sold our products to department stores like Bloomingdale’s and Nordstrom’s right away.
But I knew that getting into big-box stores would increase our visibility and ensure our long-term success. Target stores were the ideal showcase for our brand. They focused on casual, contemporary design. Moreover, they had the capacity to place huge orders.
I tracked down the candle department buyer’s phone number and left her a message. She didn’t call back. So I left another message the following week — no reply. I refused to take her silence as a ‘no.’ So I left messages every week for six straight months. I figured she might not appreciate my tenacity but she was my only way in to the company.
Finally, I had a conversation with her receptionist to ask why the buyer wasn’t returning my calls. She told me that I should go over the buyer’s head and talk to her boss. So I called her supervisor, who told me that my products sounded great and that she’d have the buyer call me.
The phone rang two minutes later: Jackpot, it was the buyer. I thought I’d finally struck gold. Then she told me what I’d done wasn’t the right way to start a business relationship. She refused to meet with me, and my subsequent calls went unanswered.
Landing the fish
Her brush-off just made me more relentless. I kept the buyer’s number on speed dial and obsessively called her every week, hoping she might change her mind about me.
Finally, after a year, I heard a different voice on the phone message, and my hopes were lifted. I figured that a new buyer would want to make a mark on the company by impressing her superiors with new vendors. Here, at last, was my in with Target. I left a message describing my company, and sure enough, she called back later that day and arranged to meet with me.
In preparation, I made custom candle samples that I’d designed just for Target, with a color palette aimed to appeal to a younger audience. As soon as I met with the buyer, she started sniffing the candles and asking all sorts of questions about the fragrances and our retail prices. Then she asked, “How soon can you deliver?”
Scaling up
I was completely caught off guard. I mean, senior managers generally will have an internal discussion before giving a firm commitment to a vendor. Not only was she sold, she wanted $3 million worth of orders to fill all 800 Targets in America. I told her that we’d be able to ship in a few months. But I had no real idea about how I’d fill the order.
I immediately went to work finding the resources to make the delivery on time. We started by hiring new staff, then turned our attention to distribution. We knew that we’d need to use new data tracking systems to ensure that the products shipped accurately. We didn’t have the capacity to do that in-house. So we outsourced our distribution to a company in California, which enabled us to fill Target’s orders and transmit them successfully.
Two weeks after our candles hit the shelves I got a panicked call from the buyer.
“I think we were wrong. I think we could have sold three times as much.”
She asked us to ramp up production immediately.
Fortunately, we have a strong partnership with a factory in Asia. I flew to China to get everything ready within six weeks. By April, we were fully stocked, and we sold Target $8 million worth of product that year.
Just the beginning
Producing the volume to meet Target’s demands was a challenge. But it immediately paid off. Target has a reputation for attracting vendors that are able to quickly scale production based on demand, which is attractive to other large chains.
Now, we’re working with retailers like Bed Bath & Beyond, Kohl’s and Pier 1 Imports. We’ve gone from 20 employees to a staff of over 50, and brought in $90 million in annual revenues for 2009. We’re opening a factory in Maryland soon, which will cut down delivery time to help us better service our demanding retailers.
The takeaway: Relentlessness pays off. Big time.
Mei Xu recently launched a second company, Bliss Living Home, which focuses on bedding and décor with an international theme
COMMENTARY: That's such a great story and a great example of how relentlessness, hard work and perseverance can pay off. The one mistake Meu made was going around that first Target candle buyer. That's a no no. But, as fate would have it, Target hired a new candle buyer, and this left the door open, and the rest is history.
As a general rule, the chances of a new company getting their products into the shelves of large chain supermarkets or retail chains are about zero. It just doesn't happen. If you are lucky enough to get them to like and try your product, it will be on a limited test basis, with only a handful of test stores carryhing your product. If the sales results from those stores are good, then chances are very good you will get a re-order, and the number of stores will be expanded, before you get the BIG order. Getting an initial order of $3 million from Target right out of the gate, without even a test, just doesn't happen.
The SymphonyIRI Group's report titled, "New Product Pacesetters: Carving Out Growth in a Down Economy", provides an excellent look at consumer trends within the food and beverage and just how difficult it is make a "hit" product in today's difficult economy.
"The effects of the recent downturn are still heavily impacting consumer packaged goods (CPG) and retail companies. Although sales have improved during the past year, the Great Recession has significantly changed consumer spending habits today and possibly forever.
The shopper of today consumes products in a much different way versus just a couple of years ago. This tectonic shift in shopper behavior has created the need for manufacturers and retailers to completely rethink how they develop, package, price, merchandise and display products.
Consumer trends within the food and beverage sector indicate that customers are shifting towards products that encompass convenient indulgence and wellness. Many consumers are trying to eat healthier, and have traded out soda for sports drinks or waters and replaced junk food with healthier options. In 2010, the most powerful food and beverage product launches were those affiliated with health and wellness.
While the consumer of today may have tightened their belts on indulgences, the need for indulgence has certainly not gone away. People are still willing to spend money on treats here and there, evidenced by an array of successful indulgent brands. These products deliver a cost-efficient, home-based solution to the ice cream parlor.
In the non-foods sector, the shift towards tending to health and beauty needs in the home continued in 2010, and the most powerful non-foods Pacesetters were those that armed consumers with the tools to get it done. Today’s consumer has cut back on going to the spa and getting their teeth professionally whitened. Instead, they are taking the do-it-yourself approach, trading in Botox and laser treatments for anti-aging serums and products that are marketed as “professional results at home.”
Despite unstable economic conditions, average year-one sales for New Product Pacesetters in 2010 climbed. Last year also witnessed great success by manufacturers small and large who took a risk by bringing a new brand to market. These trends suggest a brighter outlook for 2011 and beyond.
However, CPG and retail leaders face the significant challenge of identifying shoppers who are opening their wallets again, those who are their maintaining frugal ways, and those doing some of both. It will be critical to continuously study evolving consumer needs, and how people are learning about, buying and using products. The most powerful marketing strategies will be adjusted based on even minute shifts in attitudes and behaviors."
Check out my post dated November 2, 2010, about what Sean O'Conner did to get his Batter Blaster, an organic pancake batter-in-a-can, into the retail supermarket chain, and how Batter Blaster now generates $19 million in annual sales.
In another post dated January 27, 2010, I reported just how difficult it was to get a new product into the retail chain during the height of the Great Recession. This article provides some valuable insights for inventor's of new products.
Courtesy of an article dated January 19, 2011 appearing in BNET
Does your brand have a high Personality Quotient (PQ)? That's a key question because when you're selling to Baby Boomers, they consistently seek out products and services that are believable and likeable, just like the people they trust most. That's why one of your primary marketing goals should be to build a credible, friendly image using a variety of creative marketing communications, from advertising to PR to tweeting.
A brand's image is the personality that it projects. The best brand personalities are highly individualistic, while the worst try to be all things to all people and end up being buried beneath the clutter of the teeming marketplace. But build a strong PQ and, over time, consumers will embrace your brand as you gain an ever larger share of mind and market.
Many of the most effective image builders come from direct marketing. Take a pioneer like L.L. Bean and a more recent success story like Victoria's Secret, for example. These brands appeal to decidedly different market segments, yet, in their own ways, they've built highly individualistic brand personalities that their customers have come to know and trust. Their high PQs have helped them carve out a share of mind by standing for something uniquely important with their customers. That's why they continue to be successful, maintaining their fiscal fitness even when the broader economy falters.
PQ Doesn't Stand For Pretty Quick
Effective brand building takes time. It's a process that is measured in years and decades, not weeks and months. It's characterized by patient relationship building aimed at people who might become loyal customers. It avoids profit-shredding special promotions that appeal to bargain hunters who are constantly sniffing out the best deal du jour. Although it's true that icons like Coke might be able to survive cost-cutting branding initiatives in certain times and places, those tactics only work with megabrands that have an established image that only a catastrophe could damage.
Of course, there are some challenges that no brand PQ can survive unscathed. A good example is Toyota's recent tsunami of quality and PR disasters that have rapidly transformed the brand from a Jekyll into a Hyde. And BP has also taken a breakneck slide down a slippery slope of its own making. Whether its initials change to BK remains to be seen, but if it survives as a brand, it will be rehabilitating its image for years if not decades to come.
Unlike some brands that seem to change with the seasons, L.L. Bean and Victoria's Secret keep burnishing the same image, year after year. These brands raise their PQs slowly but surely, while other advertisers try to rebuild images instantly, as if the sheer weight of megabuck budgets can buy enduring relationships. As a result, they've earned something money can't buy: customer loyalty.
Companies with the highest PQs know who they are and what they're about, so they stand behind their products and services with iron-clad, no-risk, money-back policies. They make a commitment to customer satisfaction and back it with a "no-questions asked" guarantee, because they know that's how you build trust. Companies with high PQs also manage to do a better job of image building because they refuse to waste time or money on marketing communications that don't work. Rather than drowning the market with saturation messaging, they try to consistently reach out to their best prospects with pinpoint communications that go right to the heart of each person's self-interest.
So, to increase your Personality Quotient, build a friendly, believable image -- one that will carve out a unique niche in Boomers' minds. Once you've established that position, speak to their individualism. Do all that and more, and your brand will have the kind of high PQ.
COMMENTARY: For the nearly 80 million American baby boomers, the choices and brand preferences of the generation has, and continues to have a major economic impact. Their estimated $3 trillion in spending power has the ability to generate big revenues for the companies who own the boomer's favorite brands. Advertising Age compiled Top Brands for Baby Boomers for CNBC:
#1 - Levi's - Jeans
#2 - Harley-Davidson - Motorcycles
#3 - Volkswagen - Automobiles
#4 - Club Med - Tourism and Travel
#5 - Noxzema - Skin cleansing cream
#6 - The Beatles - Famous rock band of the 60's and 70's
#7 - L'Eggs - Pantyhose
#8 - Pepsi - Cola soft drink, the anti-Coke
#9 - Absolut Vodka - Distilled spirits
#10 - Saturday Night Live - Late night comedy series
#11 - Facebook - Social network
#12 - Frye Boots - Footwear
#13 - Coach Bags - Womens handbags and accessories
#14 - Clairol - Shampoo, hair conditioners and gloves
I am not surprised with these Baby Boomer brands, with the exception of Club Med, Absolut Vodka and Frye Boots. I don't know how they got on the list. I would've thought that Chevrolett or Ford, Crest or Colgate toothpaste, Disney, Rawhide and Bonanza TV westerns, Kellogg's cereals, Geritol, Alka-Seltzer, Tide, Milk of Magnesia, Budweiser or Miller beer didn't make the list. I would definitely say that these brands have personality.
Courtesy of an article dated May 6, 2011 appearing in MediaPost Publications Engage:Boomers
Sankai Yoshiyuki, a professor at Tsukuba University, and President and CEO of Cyberdine, Inc is the inventor of "HAL", a wearable strap-on Cybor-robotic exoskeleton that can expand and improve physical capability.
When a person attempts to move, nerve signals are sent from the brain to the muscles via motoneuron, moving the musculoskeletal system as a consequence. At this moment, very weak biosignals can be detected on the surface of the skin. "HAL" catches these signals through a sensor attached on the skin of the wearer. Based on the signals obtained, the power unit is controlled to move the joint unitedly with the wearer's muscle movement, enabling to support the wearer's daily activities. This is what we call a 'voluntary control system' that provides movement interpreting the wearer's intention from the biosignals in advance of the actual movement. Not only a 'voluntary control system' "HAL" has, but also a 'robotic autonomous control system' that provides human-like movement based on a robotic system which integrally work together with the'autonomous control system'."HAL" is the world's first cyborg-type robot controlled by this unique Hybrid System.
"HAL" is expected to be applied in various fields such as rehabilitation support and physical training support in medical field, ADL support for disabled people, heavy labour support at factories, and rescue support at disaster sites, and in the entertainment field.
Cyberdine has just shown a broader range of its HAL robots--strap-on exoskeletons that boost a user's strength with electric motors. As well as the headline-grabbing medical version (below), there's an industrial edition and an arm-booster for repetitive tasks.
These technologies belong to the new field of cybernics, in which Professor Sankai is a pioneer.
"The word cybernics comes from cybernetics, mechatronics, and informatics. But this field also requires neurology, behavioral science, robotics, IT, physiology, and psychology. It also involves law, so it even extends as far as the social sciences. We're going to develop this field by looking at all perspectives, from fundamental research to the real world."
Cyberdyne's HAL legs have been gaining attention for a while now, thanks to the fact that they offer an astonishingly promising medical boost to certain types of patients with reduced mobility. Also, they're actually being used in the field as a commercial product. Just before the Japanese earthquake struck last week, Cyberdine was exhibiting at the Cybernics International Forum and demonstrated an increased range of HAL systems, including a full body-assist suit and a "lite" HAL version intended for single-arm boosting in industrial situations.
The HAL system is an off-shoot of research at Tsukuba university by professor Sankai, and he spoke to DigInfoTV at the Cybernics forum to explain the thinking behind the robot: Most interesting among the discussions was the fact that the robotic full-body suit, which is capable of letting an operator lift weights and maneuver objects that would otherwise be at or beyond their own physical limits, is aimed at industrial manufacturing needs. As the average worker's age increases, this could be a very good thing.
As an offshoot of the technology, Sankai also imagines there would be uses in fields such as gaming in the future--the suit could contribute to in-game experiences, and the clever way it works (by reading electrical signals in muscles) could even be used to record "human techniques and skills" so that the information could be saved.
HAL's not the only robotic exoskeleton suit.
Berkeley Bionics developed eLEGS, an artificially intelligent bionic exoskeleton that helps paraplegics to walk, and when it was first unveiled, created quite a stir throughout the tech community. Everyone wondered: Could this be the big breakthrough that gets wheelchair users back onto their feet?
Lockheed Martin developed HULC, a titanium hydraulic-powered "anthropomorphic exoskeleton" that may ultimately go a little way toward transforming soldiers into superhumans.
In the light of the ongoing disaster in Japan one can't help but wonder if, in the future, rescue efforts will be ameliorated by clever robots like these. Lifting sections of a collapsed building would be much simpler for cyber-assisted rescuers.
COMMENTARY: Wow, that's impressive. I have been researching robotics for the last two years for business opportunities, and it appears that the science of robotics has now advanced from the laboratory into real world applications where it can enhance and aid mankind. These robotic exoskeleton suits are great examples.
The robotics industry is divided into two segments:
Industrial Robots - Robots used for industrial and manufacturing purposes and includes articulated robots, cylindrical robots, linear robots (including cartesian and gantry robots), parallel robots and SCARA robots. Industrial robots are heavily used in manufacturing assembly lines like those in the automotive and electronics industries, consumer packaged goods industries, and in the shipping and transportation industry.
Service Robots - Robots used for personal private use, includes domestic household robots, entertainment and leisure (toys, hobby systems and education and training) robots, and bionic robots for assisting the handicapped.
Industrial Robots
According to the International Federation of Robotics (IFR), the industrial robots sold in 2009 decreased by 39% or $3.8 billion due to a worldwide decline in manufacturing due to the recession. It should be noted that the figures cited above generally do not include the cost of software, peripherals and systems engineering. This may result in the actual robotic systems market value to be about two or three times as large. The world market for robot systems in 2009 is therefore estimated to be $12 billion. Industrial robots are expected to recover in 2010 as the world economies recover from the recession.
In terms of units, it is estimated that the worldwide stock of operational industrial robots will increase from about 1,020,700 units at the end of 2009 to 1,119,800 at the end of 2013, representing an average annual growth rate of less than 1% between 2011 and 2013. In 2010, the stock will increase by 7%. In the traditional markets: North America, Japan, and Western Europe, the stock is stagnating or decreasing while it is surging in the emerging markets
Service Robots
According to the IFR, the total value of professional service robots sold up to the end of 2009 was $13.2 billion. Service robots for personal and private use: about 5.6 million units for domestic use and about 3.1 million units for entertainment and leisure sold up to end of 2009.
So far, service robots for personal and domestic use are mainly in the areas of domestic (household) robots, which include vacuum cleaning and lawn-mowing robots, and entertainment and leisure robots, including robotic toys, hobby systems and education and training robots.
The market for robots for handicap assistance is still small, but is expected to increase substantially in the next 10 years. Robots for personal transportation and home security and surveillance robots will also increase in importance in the future.
We all know that cereal packaging is designed to attract the eyes of your five year old as you drag him down the breakfast aisle of the supermarket. Of all the aisles in the grocery store, none is more captivating to tiny eyes than the the one with row upon row of garish cereal boxes.
But, what if the cereal boxes could light up and blink on the shelves? How much worse (or more effective, depending on your point of view) would that be?
A company called eCoupled has developed a system for wirelessly transmitting electricity from store shelves into consumer packages. Their demo at CES involved cereal boxes like Trix and Honey Nut Cheerios that glowed and flashed to attract consumer attention.
Video after the jump.
COMMENTARY: I hate to say it, but packaging technology is getting to be a bit much. I thought those flashing Nike shoes for kids were so cutsey, but now the "flash" has come to cereal packaging. The little ones will go bonkers. We'll soon be hearing cries of joy, "Mommy, mommy, the Trix creature is blinking". Cereal is already ridiculously priced, so parents, please don't fall for this trap.
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