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Marketers Must Learn to Anticipate Content Trends

Do you remember when MTV was the best way to get in front of the teen and young adult audience? Once mobile technology became popular, it didn’t take long for that age group to be on the move.

In no time, videos were streaming on iTunes. Though teens continued to watch, viewership dropped. Then came instant messaging, followed by social media. For a time, Facebook gave advertisers their niche audience of young consumers congregated in one place.

That is until Snapchat and Instagram came along.

To add to the challenges of the last couple of decades, smart speakers are now in about one-quarter of U.S. homes, and podcasts are gaining popularity. In fact, about 50 percent of households now say they listen to podcasts, with a majority of them joining the trend in just the last three years.

According to whypodcasts.org, 38 percent of listeners are age 18-34, and 64 percent listen on their smartphones.

What’s Next in Target Marketing?

As technology-driven change changes direction, it is easier, and far more profitable, to change direction with it. “It’s easier to ride a horse in the direction it is going.” That’s what my grandfather told me as a little boy working with him on his farm in Texas.

Every company, regardless of size, knows they must advertise if they are to grow. Yet with all the money that is being spent, it is increasingly difficult to get your message to the right audience.

This is where it pays to be anticipatory. Using the systemic method outlined in my Anticipatory Organization Model, you can ready your organization for the disruptive transformations ahead.

Three Hard Trends and Two Tech Trends to Watch

In my work as a technology and business futurist, I have found the most effective way to approach becoming an AO is to focus on demographics, government regulations, and technology. In addition, it is always good to know which consumer technology trends will stick around. I call these Hard Trends (as opposed to Soft Trends, which may come and go).

  • Demographics drive opportunity. There are nearly 80 billion baby boomers in the United States. Not a single one is getting any younger—a definite Hard Trend.
  • Government regulation is a constant. As a general rule, will there be more or less government regulation in the future? Of course, there will be more, and that’s true regardless of the industry or organization. That’s also a Hard Trend.
  • Technology will continue to grow. From the ever-increasing functional capabilities of our smartphones to the growing use of 3D printing, technology is inevitably going to become more functional, more sophisticated, and more widespread. That’s another definite Hard Trend.
  • Multi-layered media is here to stay. According to research, our attention spans are shorter than ever, and consumers demand instant gratification and quick fixes—not a litany of product features and benefits.

Today, content channels such as social media, Apple Watch, and Google Home provide the perfect vehicles for interactivity at any time, in any place, and with any person.

  • Consumer attention is likely to stay at a premium. At least for the foreseeable future, multi-layered media is here to stay. Consumer attention remains at a premium.

Advertisers know the harsh reality: Running an ad on a major television network and supplementing it with web banner ads is no longer a guarantee of reaching the audience.

If you use my Hard Trends Methodology to look ahead to the future of marketing, you’ll be able to anticipate the fast-moving innovations to come. New devices are likely to be developed, and their connectivity doesn’t show signs of slowing any time soon.

Learn to be anticipatory—start with my book, the Anticipatory Organization, available on Amazon.com.

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Beyond Bitcoin: The Future of Blockchain Technology

Bitcoins were introduced in 2009 to great fanfare. Although there had been predecessors, Bitcoins were framed as the first form of cyber currency.

Shortly after Bitcoins were introduced, I labeled them a Soft Trend—one whose future was looking good, but not a future certainty. I also labeled cyber currency a Hard Trend that would continue to grow, predicting that there would be many more cyber currencies.

Since then, I’ve seen no need to change either designation, as there are now more than 100 different cyber currencies. At the same time, as Bitcoins struggled to gain widespread use, blockchain—the technology Bitcoin transactions are handled with—were growing.

Unlike bitcoins, blockchain development has shown no signs of slowing down and represents a Hard Trend that will continue to grow. The rapidly evolving technology of blockchain holds enormous promise for game-changing disruption across any number of industries and fields.

O’Reilly Media presciently noted in early 2015: “The blockchain is the new database—get ready to rewrite everything.”

Blockchain Explained—Security in Numbers

A blockchain is a system of decentralized transaction records. This means a transaction is created without any input from a controlling entity. A blockchain also employs cryptography to keep exchanges secure, incorporating a decentralized database, or “digital ledger,” of transactions that everyone on the network can see. This network is a chain of computers, needing exchange approval before it can be verified and recorded.

The Game-Changing Opportunity in Financial Transactions

Roughly $20 billion in gross domestic product is currently held in blockchain form, according to a study by the World Economic Forum’s Global Agenda Council. However, projections show blockchain use will increase significantly in the next decade as banks, insurers and technology firms embrace the technology to boost transaction speed and security, and trim expenses. This is already taking place, for example, with Swiss banking giant UBS and banks such as HSBC, Santander, and BBVA, which launched corporate venture funds to make equity investments in financial technology companies.

More Than Just Money

The future of blockchain is exciting. Outside of its use solely in financial transaction applications, it can transform several other industries. Other examples include:

  •      Data Storage—Current storage services using cloud technology are centralized around a single provider. A blockchain lets users store data and information via a decentralized platform, improving security and lessening reliance on any one provider.

 

  •      Voting—A blockchain voting network is inherently more reliable than paper or electronic ballots since changing one vote would require changing multiple votes simultaneously. A blockchain voting network has already been used—Denmark’s Liberal Alliance employed a blockchain for internal voting back in 2014.
  •      Military Use—The U.S. Department of Defense and NATO are actively investigating the use of blockchain. Among other applications, they’re interested in messaging platforms capable of transferring information by way of a secure decentralized protocol.
  •      The War on Terrorism—In May 2015, the Isle of Man implemented the first government-run blockchain project, leveraging it to create a registry of digital-currency companies operating on the island. The system also counters money laundering, helping prevent terrorist financing since the flow of money can be traced specifically to the source of the transaction.
  •      “Smart” Contracts—The idea behind a smart contract is that it self-manages the fulfillment of the agreement and is verified programmatically via the blockchain instead of a third party. Two or more parties agree on terms, program those terms into the blockchain, and allow for payments and other transactions once those terms are fulfilled and validated by the blockchain.
  •      Regulation—Because a blockchain cannot be changed without a majority of participants agreeing to do so, the underlying technology might be used in place of a variety of regulations, such as those mandated by Know Your Customer (KYC).
  •      Identity Management—Labeled the first comprehensive blockchain-based identity service, Onename allows users to create tamper-proof digital identities for themselves called Passcards that replace conventional usernames and passwords.
  •      The Music Industry—In October 2015, Ujo Music unveiled a working example of how blockchain-based technology would allow consumers to purchase registered works directly. We can also pre-solve the problem of legalities, where artists publish policies on how their music may be used to avoid legal action against misuse.

More Reasons for Excitement

Blockchain use is largely restricted to private forms of transactions, but when looked at in an anticipatory way of thinking, blockchain could be used for anything that requires proof of identification, the exchange of goods or verification of contract terms.

One executive involved in the development of blockchain summarized its potential in a framework we can all appreciate: “‘Check it on the blockchain’ will be the phrase of the twenty-first century. It will be as commonplace as people saying ‘Google that.’”

When it comes to blockchain, get ready to rewrite everything.

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Don’t Miss AR’s Amazing Opportunities

Augmented reality (AR) is a new industry growing at an exponential rate, loaded with opportunities for job creation. It offers a playground for entrepreneurs who want to use the certainty of Hard Trends to their advantage.

What’s most exciting about AR is that it is much easier to develop than virtual reality (VR), which requires a lot of programming and photo-realistic graphics in order to create a fully immersive virtual world.

AR takes less time and money to develop. Data is overlaid onto a live view of something, and users can multitask, allowing them to work while simultaneously accessing important information.

Both AR and VR have a bright future, but AR represents a much more dynamic world of opportunity. For example, I use an AR app that allows me to hold my smartphone up to any mountain, and the app will tell me the height of the mountain, the length of the trails, and other useful data that can help me determine where I might want to hike, climb or bike on vacation.

AR can also engage tourists who are in a new city for the first time. When you’re on a street in New York, you can tell an app what type of shoes you’re looking for, and all you have to do is hold your smartphone up and pan around to see if any nearby stores have what you want.

Soon we’ll be wearing AR glasses that are connected via Bluetooth to an AR app that will allow keynote speakers like myself to see the people we’re talking to but also see their names, and by moving our fingers along the earpiece of the glasses, we’ll switch from no data to full data.

The Augmented Reality Job Market

We are in the beginning stages of a burgeoning AR market. I would highly recommend entering the world of AR professionally sooner than later. The wide-scale application of AR is only limited by our imaginations, and early developers in the field have barely scratched the surface of what is possible.

Given the wide range of industries that will benefit from AR, I predict that in the next few years we will see a multitude of usages, especially when AR glasses hit the market. Likewise, the glasses themselves will be more aesthetically pleasing thanks to the growth of miniaturization. Prescription AR glasses will be made available for those who need them, changing the usage dynamic from smartphone apps to wearables.

If you are considering a career in AR, it’s important to think about the ideal industry that would benefit from it, such as sales, service, maintenance and repair, factories, retail stores, and real estate offices. There’s a market for it in the trades as well, as AR glasses can be used to help people train quickly to become tradespeople to keep up with growing demand.

Within five years, we will see high-fashion AR glasses worn by many people. Data will be more frequently overlaid on our surrounding environment, and video media will be included. It is already possible to 3-D print a 4K camera that is the size of a fly’s eye, and with advances in solar charging, getting energy from ambient light will help us avoid the concern of charging AR glasses.

The Positives and the Negatives

With every new industry, there are positives and negatives. In augmented reality, the greatest positive is quite clear: increasing humankind’s ability to make better decisions faster.

However, there is always a downside that we must look to solve before it occurs. The most obvious risk is that you might be paying more attention to the data than to visual reality and walk into danger. When it comes to using digital technology, there is always time to unplug. The concept of misinformation also exists, where the data overlaying your environment could be hacked and also put you in danger. Always remember to anticipate risks and think critically.

The future is bright for augmented reality for entrepreneurs and consumers. Ultimately, the industry will develop practical uses much faster than in the world of virtual reality. Virtual reality business applications will find many great niche markets, but augmented reality can be used by anyone anywhere due to the user’s ability to multitask.

The best thing about augmented reality is that you can use it while still interacting with the real world, which is very powerful. It does not encourage us to close ourselves off from our physical existence; it allows us to see insightful information in real time. It will give us a new way to discover the hidden facts that bring the things in our world to life.

We’re only at the base of the mountain of change, and the time to start your climb upward is now!

Technology-driven change is accelerating at an exponential rate, but moving fast in the wrong direction will only get you into trouble faster! Reacting to problems and digital disruptions, no matter how agile you and your organization are, is no longer good enough. If you don’t already have a copy of my latest bestselling book The Anticipatory Organization, click here to get your copy now.

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Five Myths About Price and Discounting

I can’t think of any concepts more misunderstood than price, pricing, and discounting.  An alarming number of businesses price poorly.  We even teach falsehoods about price at the college level.  Let’s discuss five myths about pricing, and its Mr. Hyde alter-ego, discounting.

I usually start breathing fire on this topic, so buckle up.  If this starts feeling a little too close to home, don’t get mad.  Get better.

Myth #1:  Price should be related to your costs.

Price should relate to customer value, period. Cost-plus pricing (your costs, plus some margin should equal price) is only useful to set a minimum, or a walkaway, not your actual price.

Take this one question quiz: Your customer wants a price that is below your costs.  You tell him so.  Question: is the average customer more likely to:

A: Erupt with a sympathetic “Oh, in that case, tell me what you want me to pay!”

B: Let you know, politely or otherwise, that your costs are not his/her problem, and (gently but?) firmly give you some version of “take it or leave it”.

So, if your costs are none of the customer’s business at the low end– and you know it – why should your costs be any of your customer’s business at the high end?

Customers will only pay any price (high or low) voluntarily – at least in the long run.  The reason they pay the price they do is that they find sufficient value in the outcomes your offer delivers.  Figure out your value, quantify it, and then set your price accordingly.

Myth #2:  Dropping your price will increase demand.

This myth is taught in economics classes the world over, up through the college level.  Economists build mathematical models using the law of demand.  Here’s the catch:  The law of demand assumes a few things in order to get the math to work:

  • All consumers and all producers have all information about all alternatives at all times – for free, and without effort.
  • All buying decisions are made without emotion…buyers are all Dr. Spock-like in a world that still uses money.
  • Related to “emotionlessness”, price is merely a number. Offered price does not communicate value to any buyer at any time.
  • All products and services are perfect substitutes for each other. They are absolute commodities, with no differences. There is no such thing as differentiation.
  • It costs nothing to switch vendors. There are no costs to qualify a vendor, and the human bias toward the status quo does not exist.
  • …there are a bunch more, but isn’t any one of these good enough to make my point?

Real life example: If your offer’s ROI is often north of 500% at similar clients, a hesitant customer isn’t going to be motivated by price. Price isn’t the problem with the deal.  Discounting is only going to convince your prospect to doubt the numbers.  Well, OK…not “only”.  There are the financial consequences, too.

Myth #3:  Price is just another feature…no more or less important than any other.

My jaw drops every time (yes it’s happened) a sales “professional” says “It’s the company’s job to make money at the price I sold”.  Then they wonder why nobody in the company invites them to the grownups’ table.

Psychologically, price is the final comparison against value – (value=desirability of your offer’s differentiation). Therefore, it’s the counterbalance against the value of all the differentiated features.  Companies with pricing savvy have proved this for decades, and in many industries – even “commodities” like steel and money.

This is so deeply embedded in the human psyche that price actually communicates value.  Buyers look more favorably at high-priced alternatives – assuming there must be a reason for the price. Dropping price perceptually diminishes every other feature in your offer.  No other feature can do that kind of damage.

If you’re unable to build value in the customer’s mind for the other features, then, sure…go with myth #3.

Myth #4:  You can “make it up on volume”.

The mathematical argument here is that by increasing unit volume at a lower contribution margin, you’ll not only get back to break-even, but get further above it.  (if it isn’t going to end up as more profitable, why work harder for the same – or fewer — profit dollars?).

The mathematical argument assumes your fixed costs won’t rise too.  Let’s think that through.  Say you’re a manufacturing leader and need to double capacity because your company decided  to “make it up on volume”.  The math assumes that you accomplish twice as much using the same plant, equipment, staff, utility bills, G&A, etc.  How many seconds of business school does it take to sniff out the fallacy?  Sure, in an infinite universe with infinite possible realities, it must be possible to “make it up on volume” somewhere, but I haven’t seen it anywhere in this dimension.

Here’s some independent research:

  • McKinsey & Company analyzed the entire Fortune 1000, and on average, a 1% drop in average pricewould cause an 8% drop in profit.
  • Mara and Roriello,in Harvard Business Review, studied an even larger sample, and found1% drop in average pricewould cause an 1 % drop in profit.

So…”make it up on volume” disciples:  how much do you discount before down becomes up?

Myth #5:  You can discount for “one time”, or for a “limited time”.

This is the myth of the “limited time offer”.  Your pricing policy is one of the easiest things to train customers on. No reputable company will really give a discount just once, and everyone knows it.  Nowadays, every customer just assumes it .  In fact, it’s actually harder to convince a prospect that an offer really isa one-time thing than it is to simply sell the value in the first place. Plus, the easy option is more profitable.

It gets even worse: customers are very hard to “un-train” on a new pricing policy. Once you go into the discounting tar pit, you might only get out as a fossil.

Worst of all: People change employers.  When one of your customers gets a job elsewhere, they carry knowledge of your discounting behavior with them.  See why it’s a tar pit?

Extra Value Bonus:  

Myth #6: If a customer says “Your price is too high”, it must be true.

Whenever somebody took the time to tell me what they think of my price, they  signaled that talking about my offer and its price was worth their time.  What they are really saying is usually “your value is too low”, or “I don’t understand your value well enough”. The other popular option: “I want your product, but am just checking to make sure I’m not paying any more than I have to.”  This is simply a due diligence step, not an actual price issue.

The customers who really think your price is too high don’t even return your calls.

Bottom Line

As I said, if this article started feeling a little too close to home, don’t get mad.  Get better. If you want to get better, contact me.

To your success!

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Trends for Every Salesperson

Every profession goes through changes, especially sales. A certain sales technique may have worked in the past, but that doesn’t mean it’ll work today. To be a top-performing salesperson today and in the future, you must continuously adapt to both market and social conditions.

There are several new business trends taking place—all of which affect salespeople in every industry. Understand what the trends are and how to maximize them so you can maintain a successful sales career.

Your Past Success Will Hold You Back

People who are in sales long-term tend to be successful. However, success is your worst enemy. Being at the top and doing well means you’re just trying to keep up and meet demand. You’re not looking at future opportunities because you’re busy reaping the rewards of current ones. The old saying “If it isn’t broke, don’t fix it” should be reworked today to state, “If it works, it’s obsolete.” If you just bought the latest device, odds are that the newer, better version is already in existence and about to be released to the public. We must evolve to stay ahead of rapid obsolescence in business.

Technology-Driven Change Will Dramatically Accelerate

While it’s human nature to protect the status quo, you have to understand that technology is changing the future, customers’ behavior, and your company’s reality. If you don’t change, you’ll be out of a job. As a salesperson, you need to embrace change wholeheartedly rather than resist and hold tight to the past. Spend some time thinking about where these impactful changes are headed. Change causes uncertainty in customers’ minds, so you bring certainty to them when you display confidence in change.

Time is increasing in value

Time is becoming more important to people because we have an aging demographic of Baby Boomers in the United States. Time gets more valuable as you get older because you have less of it. The world is more complex, with much more for people to do with their time. With so much going on, everyone is increasingly strapped for time. As a salesperson, make your customers feel that talking to you is actually saving them time. The list of time wasters is virtually endless, and these hurt your sales and profits. Prove that you’re a time saver and people will choose you over the competition.

We’ve Shifted From the Information Age to the Communication Age

Many salespeople rely on static marketing tools like company websites, flyers, and sales letters. These methods are a one-way interface. The better way is to have your sales messages be dynamic. For example, you could have a contest that encourages people to go to your site and enter. Instead of just telling people to buy your snack product, you can encourage customers to go online and vote for the next new flavor, getting them involved. The key is to generate communication, engagement, and involvement through your sales and marketing efforts. Don’t just hand out information; you want to listen, speak, and create dialogue to capture your prospects’ interest.

Solutions To Present Problems Are Becoming Obsolete Faster

Almost every salesperson has been told to be proactive by taking positive action. Unfortunately, you must wait and see to know if a certain action is positive. Instead, be pre-active to future known events. You need to look at your customer segment and identify what types of events you are certain they will experience, and focus your actions on what will be happening rather than on what is happening. Being pre-active also means that you change the way people think. When you put out a new product, it takes a while to catch on because you’re not actively changing the way people think about how the product can be used. Constantly educate your customers on the value you and your products or services offer.

The Value You Bring Today is Forgotten Faster

Sell the future benefit of what you do. Most salespeople sell the current benefits to customers who already know what they are. Your goal as a salesperson should be to establish a long-term, problem-solving relationship with customers, not a short-term transaction. Your most profitable customer is a repeat customer, so help them realize the long-term benefit of your partnership. Show them how the products and services you offer will evolve with their needs by selling the evolution of your products and services. Sit down with your fellow salespeople to create a list of future benefits that you have for your customers, and then get an idea of where the product and service developers are heading to think of future benefits preemptively.

Sales Success for the Future

The more you understand and adapt to today’s current business trends, the better your sales will be—today and in the future.

Are you anticipating future trends in your sales career? If you want to learn more about the changes that are ahead and how to turn them into an advantage by becoming anticipatory, pick up a copy of my latest book, The Anticipatory Organization.

Pick up your copy today at www.TheAOBook.com

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How Technology Changed the Billion-Dollar Ad Game

The advertising industry has had a long and successful history. It has been a very big business, especially for brands like Procter & Gamble, which topped AdAge.com’s list of the world’s five largest advertisers with $10.5 billion in advertising spending.

For decades, the personal care company kept its products front and center in the minds of consumers – on TV, in print and eventually online. The formula was simple: P&G would spend a huge amount on advertising and loyal customers would respond by buying its products.

That is no longer the case. Technology has changed the ad game for P&G – and not in a good way.

Brief Timeline of Advertising Game-Changers

So if your company is like P&G, what should you do? Start with a fresh look at how much technology and advertising have changed over the last 30 years.

As you look at this timeline, pay attention to how technology worked for – or against – advertisers throughout recent history. Then, use my Hard Trends Methodology to predict what’s next.

1990s – Hundreds of cable channels and the Internet launched, and advertisers jumped to buy space wherever their audiences would be.

Early 2000s – TiVo was one of the first disruptors to these seemingly endless advertising avenues. For the first time, consumers had power over when they got their content and began to skip the ads.

2001 – Next came iPods, which could play downloaded media while consumers were on the go.

2004 – Amazon.com launched as a virtual bookstore and began laying the groundwork for online retailers

2006 – Social media pioneer Facebook opened the News Feed, in which anybody – and any brand – could self-publish content. Facebook ads, for which advertisers once again had to “pay to play,” wouldn’t come until later.

2007 – Netflix went from DVD to streaming and never looked back. Consumers could now also choose what to watch, whenever they wanted to.

Also in 2007Smartphones came on the scene, allowing consumers to carry all types of media in their hands. The ad industry had to go mobile – often in addition to going traditional. Though it wasn’t easy to navigate at first, by 2015 mobile ad spending would top $28 billion.

2008 – Spotify started running on advertising dollars initially, but also offered premium, ad-free packages to consumers at nominal prices.

2009 – In the late 2000s, YouTube began allowing pre-roll ads; advertisers were once again able to recapture a very captive audience.

2012 – Facebook purchased Instagram. It would be five years before the $1 billion gamble would pay off, but in the meantime, real people became the faces of brands. The newest media-buying currency was the influence of the crafty, hip or carpool moms who had become spokespeople.

2015 – Amazon.com hit a milestone as it accounted for at least half of all e-commerce growth. Many experts attributed sales success to the debut of the company’s one-click ordering.

2018 and beyondNot only is data-driven advertising becoming more popular, it’s expected in today’s “show me you know me” consumer culture.

If you use my Hard Trends Methodology to look ahead to the future of advertising, you’ll be able to anticipate that the next decade will move even faster. Even more devices are likely to be developed, and they will ultimately be connected to each other as an integral part of our lives.

Now is the time to learn to anticipate the next wave of technology. Start with my book, The Anticipatory Organization, which is fittingly available with one-click ordering on Amazon.com right now.

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To See the Future, Think Both/And

Whenever a new game-changing technology is introduced, our instinct is to assume that the current technology we are using will quickly become obsolete and will vanish from our use.

History has shown that the hottest new breakthrough technologies do not necessarily replace older ones. Instead, they often coexist side by side because the old technology has its own unique profile of functional strengths that the new technology never fully replaces.

How many times have you greeted a new innovation with an either/or assumption? Either you use the old or the new. But this is not an either/or world we live in; it’s a both/and world. It’s a world that is both paper and paperless, online and in-person, old media and new media.

Yes, No or Some of Both

In my latest book, The Anticipatory Organization: Turn Disruption and Change into Opportunity and Advantage, I teach readers how to gain a major competitive edge by learning to accurately anticipate the future. This is a skill that can be learned, and in this blog I’ll share one of the principles I have used for decades to accurately predict the future of technological change, one that you will be able to apply in countless ways: the Both/And Principle.

First, a bit of history. In the early 1980s, I developed the Both/And Principle and started applying it with great success. Here are some examples that will help you to see how to use it yourself.

Either/Or Assumption #1:

The introduction of digital documents meant that we would all be 100% paperless in a few years.

For example, in the late 1980s, when CD-ROMs were introduced, industry experts, the press and futurists predicted that by the mid-1990s, offices would be completely paperless. At the time I applied the Both/And Principle and predicted that we would have increasing amounts of both digital documents as well as paper documents in the future. It’s now 2018 and we are still managing both paper and digital documents.

Why is paper still around? Paper is inexpensive, portable and can be folded and tucked in a pocket or purse. It is an inexpensive display medium that does not need power. In addition, a handwritten paper note of gratitude to an employee is far better than sending a text or an email.  So instead of asking “How can I eliminate all paper?” a better question I had my clients ask was, “What is the best use for paper and the best use for digital?”

Either/Or Assumption #2:

E-commerce will render brick-and-mortar retail stores completely obsolete.

In the mid-1990s, around the time that Netscape, Yahoo!, eBay and many other Web-based businesses started rapidly growing, many futurists and the media predicted that bookstores, auto dealerships, shopping malls and retail stores in general would soon be obsolete.

The logic was that a physical store can only hold a few hundred or several thousand items while a virtual store gives you access to millions of items or titles 24/7.

So why do retail stores continue to survive and why are many even thriving? The answer is that physical shopping is experiential, not just transactional. Brick-and-mortar stores and malls that have continued to elevate the customer experience are social gathering places that create a sense of community, which technology can’t fully replace. In addition, many products are difficult to buy without physically seeing them and trying them out. Others require a knowledgeable person to help you make a decision. Why did Apple open an Apple Store? If you have been there, you know why. Why is Amazon opening brick-and-mortar bookstores? Now you know why.

Either/Or Assumption #3:

Smartphones will replace laptops.

Not that long ago, business publications were having a debate about the future of computing. They asked the question, “With our smartphones and tablets becoming our main personal computers, won’t this make laptops obsolete?” The answer is still “no.”

The reality is, we still have the equivalent of mainframe computers, we just use them differently than 20 – or even five – years ago. If they have a smartphone and/or tablet, the majority of business users are already using their laptop differently, and perhaps much less, but they are still using both.

Introducing Both/And Thinking

While others were predicting the end of laptop computers, printed paper and retail stores, I did not fall into the trap of those bad predictions because I had developed a series of research-based guiding principles that would help avoid such mistakes, and the Both/And Principle is a major one.

The premise is simple: Your technology works well for you, but you discover a new app, gadget or process that could significantly transform your business. You don’t want to part with what’s been working for you, but you also don’t want to be left behind.

The Both/And Principle allows you to keep bridging your legacy systems with the new technology or processes. Integrating them in a way that will create higher value than either has by itself provides a pathway forward.

It is a powerful corrective measure to either/or thinking, meaning that the future will only be either one way or the other. The Both/And Principle recognizes the folly of assuming that the “new” will totally supplant the old, and it recognizes that they can be integrated. Once you try it, you will see the Both/And Principle can accelerate your team’s performance because you haven’t settled for one or the other.

Powerful Both/And Duos

Digital documents have powerful strengths; they are here to stay, but so is paper. Here is a short list of Both/And Principle examples:

  • Brick-and-mortar retailers and Internet retailers
  • Digital and analog
  • Paper mail and email
  • Nautical charts and GPS
  • Full service and self service
  • Wiring such as copper and  fiber-optics and wireless
  • Traditional media and digital media
  • Gasoline engines and electric motors
  • Digital music playlists and live concerts
  • Video conferencing and face-to-face meetings

A key success strategy is to integrate the old and the new based on the strengths of each. In fact, the hottest breakthrough technologies tend to coexist and integrate to create new value with their predecessors rather than completely co-opting them. Why? The old technology has its own unique profile of functional strengths.

Case Study: Amazon.com and Kohl’s

In August 2017, Kohl’s announced it would sell Amazon products in its retail stores. But that was just the beginning of this Both/And Principle business maneuver. Kohl’s department stores and Amazon.com have been piloting a retail model that even more perfectly demonstrates an integration of the old and new.

Since September 2017, the two have been running a pilot program in which Amazon.com purchasers who want to return an item can return it to a Kohl’s customer service desk. Customers who bought a product online can now skip the post office and instead return it to an ever-increasing number of Kohl’s stores.

Consumers enjoy the convenience, and according to a number of recent studies, total visits to Kohl’s stores with Amazon’s return program have outperformed other stores in sales by about 8.5%. In other words, customers returning items end up finding more to buy at Kohl’s. Kohl’s also reported an increase in new customers.

Both/And Thinking and You

What are some examples of Both/And thinking that could benefit you? Are there any new technologies that would give you amazing new capabilities that could become something you feel your business could not live without? What are some of the newest technologies that you believe will disrupt and transform your business? What would happen if you combined the old and the new in a way that creates higher value than either has on its own?

If you would like to learn more anticipatory skills so that you can turn disruptive change into your biggest advantage, read my latest book, The Anticipatory Organization: Turn Disruption and Change into Opportunity and Advantage

Click here for a special offer from Daniel Burrus

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Best Practices Economics Entrepreneurship Management Marketing Personal Development Technology

Tesla is Redefining the Customer Experience

One of the harsh realities of this fast-paced digital world is that almost everything we buy is out of date by the time we get it home. To obtain the most value of any purchase, especially if it is an expensive one, we need to adopt a future mind-set to help us avoid picking up legacy products.

Driving has long been considered a symbol of personal freedom — an open road going forward, with almost limitless possibilities and opportunities on the horizon. For this reason alone, car manufacturers like to add new features that make us feel like we are purchasing a car that is equipped to transport us into the future.

I recently found myself wanting to replace my hybrid SUV. I have been very happy with my Lexus, but before buying, I wanted to see what the other major brands — including BMW, Mercedes, Porsche and Cadillac, to name a few — had to offer, to see which was most suited to me and my lifestyle. As you might guess, since I have been forecasting semi-autonomous as well as fully autonomous car features for decades now, I was interested to see what they had to offer at this point in time.

As you would expect, all of the high-end vehicles had great features, including automatic braking and various systems to alert you if you are about to change lanes and hit another car that is in your blind spot. However, it was when I drove the Tesla Model X that I felt like I was driving in the future. After that test drive, my view of the other brands was changed. All the others instantly felt like the past.

From a customer experience perspective, that’s a powerful shift. Any time you can make the competition seem like they are offering yesterday’s features and functions, and you are offering tomorrow’s, you can accelerate growth well into the future.

Buying a car has always been both a left-brain and a right-brain experience. On one hand, we would love to buy that just-out-of-reach dream car, the one that our emotional, creative side would love to have. On the other hand, our rational, logical, sensible mind wants the car to be safe, economical and not too expensive. Tesla has found a way to do both.

The realization that the Tesla is already offering a wealth of future-oriented features — features that can save lives, features you know we will all have someday — has the power to change how potential customers think.

Tesla, like Amazon, is what I call an Anticipatory Organization, one that identifies the Hard Trends that will happen and then uses that knowledge to turn disruption and change into its biggest advantage.

With all of this in mind, where would the greatest young engineering talent want to work? Ford, General Motors or Tesla? I suspect that Tesla would attract the talent because it is showcasing the future, today.

Rather than sitting around waiting to be disrupted, maybe it’s time to jump on board and disrupt both yourself and your industry, to become the disrupter. We often talk about legacy software and hardware holding businesses back, but the reality is that legacy thinking is far more damaging.

If your company wants to attract the most talented employees as well as the imaginations of future customers, you need to follow Hard Trends and learn to become anticipatory rather than getting better at reacting.

When I returned to the showroom a few weeks ago, it quickly became apparent that Tesla is a prime example of an Anticipatory Organization. The majority of competitors within the automotive industry are still taking incremental steps rather than exponential leaps. The majority have embraced the idea of agility as the best way to turn rapid change into an advantage. The problem they are finding is that all organizations are becoming agile organizations, which greatly decreases the advantage of agility and, more importantly, the main advantage of agility is that you can be far better than your slower competitors. Being agile is very important and we all should get better at it, but it is no longer enough.

It’s true that there is more uncertainty today than ever before. On the flipside of this coin is the science of certainty, learning to separate the Hard Trends that will happen from the Soft Trends that might happen. As the exponential pace of technological change continues, having the ability to foresee growing problems, disruptions, customer demands and new opportunities has never been more important.

Technology now surrounds us. The rapid rise of the internet of things (IoT) in our cities, businesses, infrastructure and even our homes will also raise the bar of both our expectations and demands. As our world continues to evolve, why would the automotive industry remain the same? Why would a dealership stay the same as it always has been? Why would I want to buy a new car that has only a few more new features than the car I’m driving now?

Having a business strategy based on certainty has low risk. Leaders now have a choice to anticipate today, before their competitors do, or find themselves left behind in the slow lane. What are you going to do?

Why deploy customer surveys when technology allows you to collect real-time user experiences? Learn to how an Anticipatory Organization saves money in R&D, marketing and other steps along the way.

Order Daniel Burrus’ book today!

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Economics Growth Industries Personal Development Technology

Will Your City Be a Smart City Soon?

Despite the apparent trade-off between privacy and efficiency, authorities across the globe are intent on becoming known for achieving smart city status and for the right reasons. Politicians are seeing the real benefits and cost savings that smart city initiatives can provide, and as citizens we need to get used to the idea of our towns collecting and making use of more and more data to reshape the world around us for the greater good.

As the number of connected sensors, machines and devices rapidly grows in crowded cities, the data generated will provide the ubiquitous big data that we often hear about. But we are only just beginning to realize the value in a network that increasingly consists of everyday objects. Everything from buildings, energy, traffic flow, education, healthcare and even elevators contains information that represents both the daily grind and natural flow of every city.

This increasing volume of data that is generated every second of every day should and will be put to great use in the months and years ahead. Now that we have fully embraced the concept of smart devices with our phones, and we are beginning to experience it in our cars and homes, it’s only natural that we now look to make our cities much smarter too.

Although we are slowly obtaining a greater understanding of the data that surrounds us, the good news is that positive results are already happening. Authorities are faced with a double-edged sword in which almost every choice comes with a compromise. For example, video surveillance in high crime areas has proven to reduce crime rates from 5% to 20%, but as a society, are we willing to reduce crime by introducing cameras watching our every move? This is the kind of trade-off we will have to face if we want to dramatically lower crime rates.

The traffic in every major city across the world is probably our biggest concern, given we have all experienced gridlock. Once again, technology comes to the rescue. Traffic signal optimization has shown to reduce travel times by up to 20%.  And let’s not forget the joy of trying to find a place to park. The average person spends 18 minutes per day trying to find a place to park. Smart parking systems can reduce up to 30% of congestion without authorities even needing to build new lanes and roads.

There is already a wealth of statistics available now that major technology research in cities has revealed the scope of the cost savings. For example, 40% of municipal energy costs comes from street lighting. Intelligent lighting can reduce energy costs by up to 20%. Lansing, Michigan, put in smart street lighting and was able to reduce costs by 70%, a big win for the mayor who championed the initiative.

As a word of caution, it appears that we are still very naive when it comes to security and our responsibility in this digital age. With so much of our lives and infrastructure getting connected, we all need to step up our game and appreciate the implications of ignoring security warnings.

For example, a recent report revealed how vulnerable our hospitals are to cyber-attacks and hackers. Maybe it’s our self-awareness that is in need of a 21st-century upgrade. In years past, 18 USB sticks were dropped purposely on multiple floors of a hospital. Within 24 hours, one of them had been plugged into a nurse’s station, infecting the network with malware, which gave the hackers access to the entire network.

With the majority of public-serving institutions at risk from hackers intent on causing chaos and disruption, it’s more important than ever to re-evaluate your level of security and threat prevention. Threats can appear in many different forms, such as ransomware that will lock all files and demand payment to unlock your data. The only positive aspect of ransomware is that it informs the user instantly of an infection.

However, there is also much stealthier malicious software that can be secretly stealing data or compromising systems completely under the radar of the establishment. Eliminating these risks by upgrading old systems is key, but so is educating users about understanding the vulnerabilities in the workplace and how to prevent them.

The creation of closed systems with hardware-embedded security will make it easier to predict and prevent cybercrime. Crime will continue to be a risk, but new advanced intelligent systems can help predict an attack and prevent it before it happens.

These security challenges should not damage the level of excitement and energy around the future possibilities. In this digital transition, we are merely taking another brave step forward, and there is no doubting how cash-strapped local and state agencies can become more efficient by better using data and implementing new technology.

Many large companies are involved in making cities smart, including Cisco, IBM, and Siemens. Cisco will happily advise governments that a smart city can save energy by 20%, reduce water consumption by 50%, crime by 20%, traffic by 30%, and so on. These facts, backed up by data, will be tough for those in control of budgets to resist.

Businesses, local and state agencies, committees, etc., will always be cost and data driven. Our evolving digital economy will ensure that smart cities, IoT, and local services will all become a natural part of our lives. Yes, there will be security and even privacy challenges, but this is a hard trend that will happen, so the time to start solving predictable problems is before they happen.

Many of our fears of a technology-fueled dystopian future are based on fictional literature and Hollywood movies. But we seldom stop to think that our future reality could be quite different from 1984 or the rise of machines that the Terminator franchise warned us about.

Real life is not always as interesting as art. The implementation of computerized sensors for nearly everything we know and love to drive down costs and improve efficiency could be as exciting as it gets. Is it such a bad thing?

Eliminating waste, intelligent traffic management and vast improvements to public transport during peak periods are mouthwatering prospects on their own. The belated arrival of e-government services, allowing faster access at a lower operating expense for taxpayers, should also be enough to convince even the biggest cynics.

I don’t believe this is an either-or situation. Technology should be able to improve every aspect of our lives in our homes, cities and world. We now interact with each other more than ever before, not less—contrary to popular opinion. The rise of the global community is enabling a greater understanding that shapes our world view and challenges age-old stereotypes.

As citizens of a global community, we expect our smartphones to provide us answers to any questions as they pop into our heads. We have developed an insatiable thirst for real-time information. Reliability and simplicity are expected to be standard, meaning this is how cities will soon be judged by both their inhabitants and visitors.

We now connect and interact in many different ways, which illustrates how technology is bringing us closer together. The real spirit and character that live inside every city across the world do not need to be sacrificed and will continue to thrive as long as we work to keep the best of our past and present, as we build a better future together.

Concentrating on resisting change or fearing the unknown is counterproductive. I have advised major businesses and governments for decades that the best way to improve planning is by learning to separate hard trends, the trends that will happen, from soft trends, the trends that might happen, and use this knowledge to shape the best future possible.

Innovation leads to disruption, not being disrupted. Learn more with the book, Anticipatory Organization, now available for purchase at www.TheAOBook.com
Categories
Accounting Economics Entrepreneurship Industries Investing Management Personal Development Taxes

Highlights of the 2017 Tax Cuts & Jobs Act

CHANGES TO INDIVIDUAL RATES AND BRACKETS– lowered top bracket from 39.6% to 37%

  • Married Individuals highest bracket starts at $600,000; Single Individual $500,000; Trust and estate $12,500
  • NEW-Dependent children aged 18-24 in school must use trust rates not Parent’s rate
  • Capital gains rates remain unchanged
  • NEW-three year holding period for carried interest distributions, sales or redemptions for Long-term capital gains
  • AMT thresholds increased

CHANGES TO INDIVIDUAL DEDUCTIONS

  • Only deductions available: medical expense, Interest expense, charitable deductions and tax expense and business casualty loss
    • Taxes limited to total of $10,000; Mortgage debt for existing loans limited to $1,000,000 and New home purchase $750,000.  Cash contributions limit increase from 50% to 60% of adjusted gross income
  • No longer deductible expenses-Alimony paid for and alimony received under divorce contracts entered after 2018, tax prep fees, employee business and investment expenses and other miscellaneous itemized deductions moving expenses; personal casualty theft loss except for federally declared disasters
  • New 529 plans for elementary or secondary public private or religious schools.
  • Like kind exchanges now limited only to Real property so fast-food restaurant franchise licenses and patents; aircraft, vehicles, machinery and equipment, railcars, boats, livestock, crypto-currency, artwork and collectibles are no longer eligible.
  • Current year business operating losses including passive losses limited to $500,000 joint and $250,000 for other filers.  Anything in excess cannot offset capital gain or investment income.
  • No carryback of Net operating business losses. Carryforward of future losses limited to 80% of taxable income.
  • Increased limits for expensing capital assets up to $1,000,000 for new & used property.
  • Non-owner of some private company employees may get up to 5 years to defer income on exercise of stock options or RSU’s.

CHANGES TO ESTATE TAX

  • Life time gift & GST exemption-2018 $11,200,000 single & $22,400,000 married couples.  Will be adjusted for inflation each year.  
  • Annual gift tax amount-2018 Increased to $15,000

CHANGES TO BUSINESS (SCHEUDLE C) AND PASS THRU ENTITIES

  • NEW- 20% deduction for pass thru or Schedule C qualified business income done at individual level
  • Limitation of business interest deduction limited to 30% of the business’s adjustable taxable income, exception for real estate companies who elect longer depreciable life for real estate.
  • NEW-Taxpayer’s average $25 million gross receipts- can use cash method of accounting and don’t have to use UNICAP rules for inventory capitalization.

At GROCO, we assist high net worth clients and their families with wealth creation, family transfers, taxes and charitable giving. Please give me a call at 510-797-8661 if you need assistance or have questions on these new rules or would like to know how to make, keep and/or transfer your wealth.