You’ve certainly opened up an interesting debate, my friend! See, I’m not sure this is the coming of a new trend, or Amazon’s admission that penetration of ebooks is maxed out. You do well in identifying two reasons why books are still sticky: the ‘book experience’, and the digital fatigue. Book experience is certainly sticky but is likely to become more and more niche with time. Both the browsing of a bookstore as well as the reading on paper is a romantic notion that will simply be overcome by convenience, relegating the book to an art form ala the vinyl records. Digital fatigue, though, feels more in the sphere of control of Amazon. They currently have the ambition of both owning the device and the media, which could be limiting their penetration in the short term. Consumers increasingly want lesser devices to do more. In the long term though, I still have hope that Amazon’s bets will pay off on the devices front if they can continue to offer greater value on the media side. Could they boost this at a cost – quite easily – imagine if you could be incentivised that every time you buy a hard book, you get the e-version for free. I think we’ll find that behaviour change will be pretty rapid.
Your post really does start to marry a sense of optimism while acknowledging the work still ahead. I agree that the Obama administration has gone a long way to have a more direct relationship with the populace through media channels they are on. A vast majority of the interface that a citizen has with the government on a daily basis, however, is still marred by inefficiency and bureaucracy. Granted the US is a huge country and the state system adds a further layer of administration. I wonder if there are lessons that the US can learn from their smaller friends in Europe who have had more success in digitising government services and delivery. The good news is that given how unpleasant the current experience is for the average ‘consumer’, the only way is up!
Great piece of analysis. It’s good to see that organisations such as the NYT are constantly looking to innovate in their attempt to stay ahead of the ramifications of technology. However, I wonder if they could do more to deliver on the customer promise by adapting themselves around the way that people interact with them in various platforms as well as devices. Granted, a large part of their ‘initial traffic’ will now be driven through social media channels. Can they do more to convert people into their app through a more value-added proposition. There is an argument to be made that a reader they have a direct relationship to is worth more than one that they get through a FB referral. Even from an advertiser’s point of view, the former commands a higher premium. NYT is still fighting the fight for subscription though and one questions why this obsession with monetising on the reader’s side is so sticky. The market for news is simply too competitive and highly democratised. Perhaps it’s time for them to dive into the deep end and take the likes of FB on, by becoming more sophisticated and therefore more attractive for the advertising dollar, while leaving readers with unlimited access in exchange for their direct relationship rather than their subscription dollar.
This kind of progress is inspiring in the context of our insatiable need for extraction of minerals from the Earth. While operationally Rio Tinto is certainly leading the way towards automation, through investments that will pay back in groves to the company and save lives, one has to also scrutinise the operations beyond the mine itself. There are still substantial social costs to mining. This week two senior executives at RT got the boot for being complicit in bribery in Guinea. Furthermore, such automation is likely to also result in widespread unemployment in the local area. Should the company do more to mitigate these problems or is this a necessarily evil given the market for these minerals? Are there measures that regulation and innovation should focus on on the demand side?
100%! A number of companies like Unilever do quite well with becoming thought-leaders by partnering with universities on White Papers. Of course, the answer is both things need to be done: research, as well as ‘marketing’ to get consumers to care. Remember the fact that consumers in the world still continue to smoke tobacco knowing fully well the research on its link with heart disease and cancer…!
Interesting point about product – coffee is a single ingredient product, but you’re right maybe some work could be done on blends. Also some great work happening in the arena of instant coffee around yield (getting more ‘coffee’ out of every pound of bean).
Very good point about scale. Coffee Made Happy was built to affect 1 million coffee farming households by 2020. Interesting fact: if all the coffee brands in the world chose to be ‘certified’ and good there’s a huge lag until supply could catch up – there simply isn’t enough of that type of coffee bean out there yet. So some fundamental changes needed in long term consumption.
Some amazing questions. Consumers certainly do have the ultimate power in my opinion. Despite the power of brands to charge a premium, the fact that consumers vote with their wallets and buy certain brands over others is a huge motivator. Fairtrade vs Fair trade is a big debate too. The former is about price point and margins as you said, the latter about capabilities and access.
Really great insider perspective, Jason. I can’t think of any company that is better placed to tackle the gap of between consumers and producers on climate change than Google, the gatekeeper of a majority of the world’s information. Besides their own footprint and initiatives around reducing it, I wonder what else Google might be able to do in the consumer space beyond its own industry? When I think of companies leading the agenda, Google seldom comes to mind. That being said, their research into projects such as the driverless (electric) car will undoubtedly have a huge impact and gives them the right to play more actively in the fight against the hydrocarbon economy. Of course electric vehicles and cloud storage data centres can be blamed for simply shifting the energy more upstream, net net they are helping move us in the right direction. What would it take for Google to step out and take ownership of this as ‘their fight’? I don’t imagine that there are that many internal barriers but are they trying to be too PC to the anti climate change lobby?
This is a topic really close to my heart. Pakistan is a major producer for Levi’s (raw and finished good) and is one of the countries destined for an enormous water shortage imminently, particularly due to conflict with their neighbours on the usage of water upstream. I am inspired by Levi’s focus on the consumer as it is undoubtedly the place where change can truly happen. In fact, I find myself washing my denims lesser since I heard about how not washing them actually preserves them and their colour for longer. One has to question though whether there is an inherent conflict of objectives there: use less water -> jeans last longer -> buy less jeans -> make less jeans -> less profit? I commend the company for thriving to find a sustainable solution.
On the production side, there is yet more work to do, especially in environments like Southeast Asia, where regulatory players are often weak and corrupt, and it can be more costly still for companies to do the right thing for long term sustainability, and traceability is incredibly complex to achieve.
Really educational post, Chris. Therein lies their challenge it seems: they are dealing with a double-edged sword when it comes to communicating their mission and their practices. If they share too much, they get blamed for talking more than they are walking; equally, it is evident they don’t push it enough in front of consumers for us all to know about it universally. The trouble is that you still have to be resilient and not let outside criticism affect you as this is a journey – you will always have people hold you to impossible standards, when the industry as a whole simply hasn’t cracked it and you get blamed for trying and not getting their instantaneously! Like yourself, they could really use a larger mass of consumers to champion their cause by making it more meaningful and widespread for consumers. Doing good is ultimately good for business!
Mars has an enormous footprint on the cocoa industry. However, unlike its key competitors – Nestle and Mondelez International – I get the sense that Mars has been less of a leader in adoption of method towards sustainability. They were far behind Cadbury and Kit Kat on Fairtrade certification, and often do not market their other initiatives. One could argue that the fact that they are a privately held company unlike their competitors, they have less pressure to present their sustainability agenda. That being said, they certainly are doing a large amount of work in other kinds of sustainability with regards to consumer portion control, using less energy etc, but again don’t market it that overtly. In order to truly be making a dent, Mars should consider finding a meaningful and motivating way for their consumers to care about and drive their climate change agenda. Only the economics of that force can help the industry elevate past token pilot programs.
Fascinating read. While supplier security affects many of our food categories, you point out some really strong strategies, particularly around the product ingredient mix. Palm oil has now become a huge political issue for companies to manage as consumer groups firmly have their cross-hairs on it. It is claimed by many that the production of this ingredient has a double whammy effect: it takes away precious land from more staple-type crops, thereby leaving more people hungry, and also it has environmental ramifications. One needs to recognise though that the popularity of palm oil was primarily due to its cost advantage as a substitute to ingredients like cocoa butter which were much more expensive. Some clever chemistry could certainly help to find new substitutes no doubt, as the economics start to play against it.
Cocoa though is facing a large number of tangential issues. The no.1 threat in the short term is a people problem. Young people coming from farmer families don’t want to go into cocoa due to the fact that it is dangerous and not respected by communities; instead they choose to move to urban centres. In order for cocoa to be more sustainable, it is important to have companies like Ferrero, who also source cocoa for their chocolate products, become leaders in the arena of making farming more respected, safer and more profitable.