Social Trends among the younger generation - opportunities?

I was recently at the Microsoft Global Accounts Summit, which is a high level meeting for the company’s top customers.  Among the fascinating agenda items was a presentation by Robbie Bach, President of Microsoft’s entertainment and device businesses (yes, he’s the guy responsible for much of Microsoft’s reputation for “cool” among some customer segments!). 

He made a very interesting observation about how different the younger generation is from those that came before in terms of how and with whom they network, socially.  To whit:

The generation of consumers growing up now is the most social generation in history.  When I grew up I had friends in the neighborhood.  We’d get together with people in the house.  This generation of kids have friends in the neighorhood, but their definition of ‘neighborhood’ is completely different.  Teens and people in their twenties have an average of 53 friends.  The fascinating thing is that 20% of them they have never met in person. 

These virtual friends open up all kinds of opportunities for changing the experiences people have with your products and service offerings, and I believe we are only beginning to scratch the surface of the implications of this.  Trends that have already been noted include the potential for viral marketing among loosely grouped bunches of people, the use of friend recommendations to enhance reputation or sell products and the evolving definition of who is a trusted source.  There are also major downsides that companies really need to think about before making potentially stupid moves. One I read about just the other day is that when you and your boyfriend/girlfriend break up, and you change your status on sites such as Facebook, it tells all your friends!  Imagine the multiplier effect of having all that heartbreak out there in public where everyone can see it. 

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• Posted Rita McGrath on March 05, 2008

Second order effects of sub prime about to land on insurance

Apparently “the insurance industry is bracing for an increase in arson among homeowners who see setting the house afire and collecting the insurance payment as an alternative to foreclosure”.  This according to the January 21 Fortune. 


What an interesting example of several things:  The law of unintended consequences - who anticipated that financial troubles could spill over into coverage troubles for insurers?  The consequences of second order effects - that every major industry wide event will have side effects.  And finally, the vital importance of having early warnings in place.  If I were working in home insurance right now, you betcha I’d be both watching homeowners in a risky situation and making sure I warned them off. 


Of course, the entrepreneurial angle of this is that there must be opportunities to be had in staving off these issues or helping insurers anticipate them more rapidly. 

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• Posted Rita McGrath on January 15, 2008

Emerging Enrager - Too Many Unwanted Catalogs and other unsolicited outreach

BusinessWeek, in its December 31 year-end issue, reported on the activities of an activist website called “Catalog Choice” which promises to help people opt out of receiving unwanted catalogs.  Apparently, so many people are irritated by the sheer mass of catalogs they receive, that since the site’s launch in October, over 300,000 people have reportedly gone there to try to stop the deluge.

Things have gotten out of hand.  In 2006, the article reports, 19.4 billion catalogs were mailed, versus 13.4 billion in 1996.  By my reckoning that means that every American receives, on average, over 70 catalogs a year—many of them clumped together around the holiday season.  Since most people live in households, that could translate into hundreds of catalogs every year.  If you don’t want them, it’s a real nuisance, that only gets worse as the numbers increase. 

The reaction of catalog based retailers is one of dismay.  They are rather reluctant to take people off of their lists—after all, catalogs are one way of reaching elusive and desirable customers, catching them in those weak moments after they get home and start flipping through the mail. 

On the other hand, one could imagine an enraged backlash leading to a significant PR problem for those companies, as consumers begin to insist on the right to be undisturbed.  They’ve already come out in their millions to take telephone numbers off of “do not call” lists. 

My personal peeve is not with catalogs so much as with the steady flow of pre-approved credit card offers that flood our house.  Since these are a serious identity theft risk, not only are they simply a nuisance to be thrown away, but have to be taken apart and shredded, causing time-wasting busywork.

So, entrepreneurs out there—any thoughts on how to capitalize on consumers’ emerging rage over so much unsolicited incoming correspondence?

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• Posted Rita McGrath on January 04, 2008

GPS Technology to end car crashes

Wired magazine features an innovative use of new GPS technology that I thought could be the harbinger of all kinds of opportunities.  The system is called “StarChase Pursuit Management System” and it works like this:  When a police officer is chasing a suspect’s car, they can launch a laser-sighted homing device with a GPS tracking transmitter from a sort of cannon.  The transmitter attaches itself to the fleeing vehicle, and then starts to send real-time location information back to headquarters over a cellular network.  The police then automatically know where the car is, and don’t have to engage in those dangerous high speed chases. 

The system is being tested now, and the LAPD are going to be adopting it in 2008, they hope. 

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• Posted Rita McGrath on October 17, 2007

How one industry was nearly undermind by its own success - Cycling

Imagine, if you will, that your industry received global attention for many years, had a popular and charismatic heroic character for people to look up to, and sparked waves of interest and enthusiasm among all observers.  Wouldn’t you think that would be a wonderful thing?

Turns out, not so for U. S. based manufacturers of bicycles.  The industry has been in flat growth or in slow decline mode for decades, but was enjoying a false sense of security after Lance Armstrong’s incredible 7-string winning streak in the Tour de France.  Then, interest in the Tour and in performance biking led to sales for high-end, sportsmanlike bikes to spike upward.  But who got left behind?  The 161 million of us who don’t ride, don’t look good in Spandex and wouldn’t know how to operate a performance bike if someone handed us one.  Designer Shimano’s response (working with design firm Ideo) was to develop the Coasting line of bicycles.  They’re built for comfort, not for speed, with automatic shifting instead of gears that have to be changed, a comfy seat and easy to maneuver brakes and so on.  We’ll see how they are received in the market, but it certainly has the potential to revive biking “for the rest of us…”

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• Posted Rita McGrath on October 08, 2007

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