Sobering thoughts for the New Year?

I read recently that the earliest share certificate dates back to 1288 when Stora Enso granted Bishop Vateras 12.5% of a Swedish copper mountain. Stora Enso, by the way, is still trading as a pulp and paper manufacturer!

Intrigued, I discovered that the world’s oldest company  is claimed to be a hotel  in Japan, founded in 705, and according to the credit rating agency, Tokyo Shoku, there are more than 20,000 Japanese companies over 100 years old.

Founded in 705

And yet when researchers, Arnold King and Nick Schulz reviewed, the 1957 Fortune 500 list against that of 1997 they found that just 40 years on only 74 companies remained! They called this Creative Destruction.

Further investigation led to a paper by Professor Richard Foster of Yale who found that the average lifespan of an S&P 500 company has decreased by more than 50 years in the last century, from 67 in the 1920’s to just 15 today!

                                      Just 15 years

The Japanese believe the secret to corporate longevity is to stay small, avoid takeovers and mergers, and to have a belief that their mission is not just the constant pursuit of profit.

King & Schulz however think it’s about keeping up with innovation.

                                                                         Role of Innovation

I’m not sure that staying small and making profit a secondary objective is the sort of advice that is appreciated from consultants!

 But focusing on Innovation………….that’s a different matter, but then I would say that wouldn’t I!

The genius of everyday things!

London's Science Museum has just opened a new exhibition, "Hidden Heroes". It features numerous inventions we now take for granted like wire coat hangers, rubber bands, tea bags and bubble wrap. It calls them "the genius of everyday things".

I was struck by the simplicity of the ideas and it resonated strongly when I recalled a recent survey finding that whilst 78% of US households claim to like trying new products, 75% of homes try fewer than 10 new items each year.
That's less than 10 from a total of 105,000 new food and drinks noted by Mintel.


The question most companies face is how do I get my new product into the 10 that are tried (or how do I get to increase the total to 11!).

I think the answer is observable in the Museum:
- Successful ideas require little thought by the consumer

- They intuitively communicate their benefit


- The innovatory feature is truly valuable to the consumer


Wire coat hangers, rubber bands, tea bags and bubble wrap - each one fits these three imperatives.
They are all meaningful, understandable and relevant.

Brand Elasticity

Living in New Hampshire has many advantages just one of which is the excellent range (and price) offered by the NH State Liquor store, my most recent visit added yet more value. A fascinating example of brand elasticity.

Can you imagine drinking a wine branded Smirnoff? Or Kettle One? Or Stolichnaya? Nor me – but could it work the other way around, a Vodka called Mouton Cadet? No. A whisky named Chateau Latour? No again, although maybe a brandy ..…?

It all depends on the associations the name carries and the delightfully named Cupcake Wine does seem to me to carry off the tricky task of being appropriate for Vodka too.

For the record Cupcake is not the product of a small eccentric producer but marketed by The Wine Group, the 3rd largest US wine producer and behind numerous other brands including Franzia claimed to be the worlds most popular wine box.

The Wine Group was formed by (amongst other purchases) the acquisition of Coca-Colas wine interests, clearly there’s marketing in its DNA.

Its not a failure it’s a learning experience!
Written for a soon to be published book on Innovation Delivery



Its often stated that 9 out of 10 new products fail, and academic researchers have claimed that it takes 3000 ideas to achieve 1 commercial success. There are so many definitions of what is new and what constitutes success or failure that it would be easy to challenge any of these findings but no-one will dispute the general belief that there are more failures than successes and that achieving real breakthroughs is difficult – very difficult.


But although it sounds like a Mother saying “don’t give up dear” as her child learns to ride a bike, each failure really does bring success closer. Scientists don’t expect every experiment to succeed, so they analyse the reasons for failure and try to correct them, its what empirical science does. Business however views failure like death, its career threatening Managers sensing failure hurry to disassociate themselves from projects, and rush to start something new to sound positive and confident about.


There is a lot of truth in the old saying that success has many parents but failure is a bastard!


I’ve seen test markets fail because a product manufactured in a pilot plant didn’t perform properly and yet despite an easy fix the whole test was junked. I’ve seen concepts bomb in research when changing just two words would have overcome the issue. I’ve seen strong purchase and repeat purchase scores discarded because they didn’t come in fast enough.


The management teams all knew the reasons for these problems and yet such was the fear, not so much of the financial effect of failure but of personal reputation, that no one did the obvious and identified the problem, sought how to correct it and re-launched.


No one wants to fail, its expensive and time consuming, just like developing and researching the idea was, so view a market launch problem as a step in the process not the last stage. Analyse what needs to change, change it and try again.


Failure gives you real world market experience and that brings the old 9 out of 10 fail metric down to much more manageable odds.


The sort of odds that careers and empires grow from not hide from!

Please let this be a failure!

Word reaches me from England that the country is in danger of returning to its "food is just fuel" roots.



The Brits invented the sandwich (you do know the story of its invention by the Earl Of Sandwich don’t you….he called for a food that he could eat whilst at the gambling tables).


Later retailer Marks & Spencer and their suppliers sorted out how to make, deliver and sell delicious sandwiches nationwide despite a 24 hour product life.


But now I hear that Booker, a major grocery distributor, has developed a 14 day sandwich.

Technically its classic gas flush packaging, careful choice of ingredients, no tomatoes or lettuce to make it soggy and an oat based bread that defies staleness longer.


Strategically it may offer business advantages, less waste and better on shelf availability all leading to a new profit opportunity.


Emotionally however I’m hoping its going to be a classic case history failure. Its food, not emergency rations, its about pleasure as well as nutrition.

Come on Britain, we’ve come so far, lets not go back to “the French live to eat but we Brits eat to live”.

What no packaging - at all?

Thanks to the very wonderful Morning Cup I've just been reading about in.gredients an Austin Texas start up that claims/aims to be the first grocery store that you bring your own packs to.
All lines will be sold from bulk and shoppers fill their own containers whether its grains, dairy, detergents or even wine.

One for the very committed eco warrior - me, I'll stick to Farmer Markets, no or low packaging, local products, meet the farmer......
in.gredients is currently raising investment through indiegogo the micro funding site.

This study will change markets!

The Washington Post reports a 20 year 120,000 respondent study by Harvard on US eating patterns and weight change. 
The federally funded study found striking differences in how various foods and drinks — as well as exercise, sleep patterns and other lifestyle choices — affect whether people gradually get fatter.

The findings suggest that its not just calories in calories out that is the only variable - its also where the calories came from and the different effects of various foods on how our bodies convert energy.
I'm guessing that this study is going to launch numerous new diets and some fascinating new food claims. I'm just glad I'm not working with a potato client today!