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Four Driving Forces
Saturday, Apr 09 2 30 PM : Northeast Conference | Speakers


Andrew Zolli is a futurist, and makes a living trying to figure out what happens next. He does this for Popular Science, American Demographics magazine, National Public Radio, and his own company, Z Plus Associates. And he's pretty good at it.

After some very long drawn out issues with malfunctioning microphones, Andrew held a large crowd at Memorial Auditorium fascinated well into their lunch breaks by naming four Driving Forces producing change in the world (yeah, its kind of a broad heading, but this is where futurists have to start). Incidentally, if you're familiar with the Pop!Tech conference in Camden, Maine, many of these concepts are distilled from the pile of information presented at the most recent one.


1. The Tyrrany of Choice: While the number of choices available to consumers in the developed world is increasing exponentially, our ability to recognize between them has actually dropped slightly. According to research, there are 40,000 different items on sale at an average American supermarket (including 51 kinds of toothbrush), more than double what was on sale in 1965. The average consumer can distinguish about 160. Zolli calls this Moore's Law of Crap.


2. The Chain of Meaning: For me, this was the most revelatory. Let's use the example of coffee beans --

chain.JPG

-Commodity: a small amount of unprocessed coffee beans can be bought wholesale for about 10 cents
-Product: that same coffee ground and put in a can costs about 25 cents (the Maxwell House business)
-Service: that ground coffee brewed in water and served in a styrofoam cup costs a dollar (the Dunkin Donuts business)
-Experience: that same cup of coffee, served with flavorings and foam in a pleasant space with background music costs $4.50 (the Starbucks business)

The margin increases dramatically at each step in this chain, which is why economies move ever away from commodity as they gain the ability to do so. Design is a big part of this ability.

So, the trick is, how do you de-commodify things? Hershey's did it in Times Square, convincing people to wait 45 minutes in line to get into a blinged out Hershey's store so they can buy Kisses at $25 a pound. Directly next door is a drug store that sells Hershy's Kisses for 50 cents a pound. That's a 5000% markup -- Commodity vs Experience.


3. Demographic Transformation. In a nutshell, the developed world is shrinking and getting older. The developing world is getting larger, richer and more urban. The concept of "Design Within Reach" is laughable to most of the world, and will continue to be unless price points drop dramatically, and good design is, in fact democratically accessible to the rest of the planet.


4. Not sure what to call this one...let's say The Long Tail theory. This means that, while information and product continues to be produced primarily by a small number of entities, the number of smaller producers has increased dramatically (think blogs vs. mass media, customized shoes on eBay vs. Payless Shoe Source). And consumers are buying from both ends. The Long Tail also offers unprecedented opportunities for consumer feedback (think X-Files fan sites re-writing entire seasons of the show).

Posted by: Carl Alviani | Permalink | Comments (0)
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