Today, no company grows its way to greatness without creativity and design. This is why large corporations and even medium-sized businesses have invested substantially to set up their design units (sometimes called creative or innovation unit) and found it drives their ROI and long-term growth prospects
Future Concept Lab: Searching for comparative advantage through genius loci
Francesco Morace+Lucia Chrometzka
Sociologist Francesco Morace and concept designer Lucia Chrometzka of Future Concept Lab (FCL), a research institute in Milan, Italy, spoke on the second day of “Creativities Unfold, Bangkok 2006-07, Perspectives on Value Creation,” the three-day international symposium organized by the Office of Knowledge Management & Development (OKMD) and Thailand Creative & Design Center (TCDC).
According to FCL, every country has a “genius loci”—the talent and energy of the place. Understanding one’s own genius loci is critical in learning how to innovate competitive products within the global market. Research through observation around the globe reveals one’s own genius loci, uniqueness, and comparative advantage.
An example of this research was commissioned by OKMD. FCL collected observations of Chinese daily life in two cities, Beijing and Shanghai. They combined a sociologist’s analysis of consumption behaviors with designers’ insights about interpretations and implications to reveal new market possibilities.
These observations were analyzed according to four dimensions. While the old “4-P” parameters of market competitive advantage were product, price, place and promotion, they said that now comparative advantage depends on four social factors: people, places, plans and projects centered on the construction of experience or occasion.
Morace and Chrometzka came up with two very different pictures of Chinese consumers.
Ever since Deng Xiaoping said “to be rich is glorious,” demonstrating family wealth has become increasingly important part of Chinese daily life. In Beijing, shopping days become like tourist activities, complete with photo albums. Consumption is not only conspicuous but exaggerated—for everything from mobile phones to fast food—demonstrating excess rather than functionality.
-Beijing designer Xie Rong, who prefers to be considered a craftswoman rather than
a fashionista, bucks popular trends to create comfort-conscious bohemian garments constructed of ethnic Chinese and imported fabrics.
-Shenmei hair salons created atmospheres so trendy that they became like night clubs as places to see, be seen and socialize, as well as getting professional service and great haircuts. The chain has expanded to 500 locations and 7,000 employees.
Shanghai has different patterns of consumption. Starbuck’s green tea frappuccinos are still popular, but many are disenchanted with mass produced global brands. They are more interested in products that come embedded with meaningful stories. Shopping is less about status than about trying on different roles and identities through these purchases.
-Layefe, an upmarket retailer emphasizing home-grown housewares, plans to expand their “lifestyle” brand as more middle-class homeowners look to create their own mainland style, so they are allocating space inside the store for original artists and designers.
-Near Shanghai’s famous Bund, Simon Ma’s new project is MCLUB, an elegant space with room for a design workshop, art gallery, music club, restaurant and hair salon. His objective is to create a hangout that attracts the kinds of minds—local and expat — who will exchange ideas, stimulate creativity and otherwise inspire the 160 designers of his “Made in Shanghai” MA.DESIGN residential and commercial design business.
They then described how this relates to Thailand. In order to compete internationally, Thailand needs to identify the cultural assets hidden in Thai culture, the genius loci, that are most likely to appeal to consumer groups around the world. Morace and Chrometzka provided three examples of such consumer groups: The “unique sons” of China, the “mind builders” of India, and the “pleasure growers” of the west.
Although they also see distinct trends in different generations of Chinese consumers, Morace and Chrometzka say the most interesting target for Thai products is the generation of only children, especially males, born after introduction of the PRCs one-child policy. They describe these “Unique Sons” as individualistic, egocentric and narcissistic consumers whose economic activities and creative energies have become the center or attention in consumer activity. Luxury for the Unique Sons embodies the idea of exclusivity, excess and exhibition—not only having the best, but exhibiting it, showing the wealth. Their “product profile” suggests they will be receptive to high-quality products with neo-romanticaesthetics, from classic and trendy brands that are made to measure through neo-artisan services and sold through innovative and distinctive shops and events.
Though proud of their roots and culture, the “mind builders” of India become the new intellectual bourgeoisie of Asia, passionate thinkers reflecting deeply on the sense of existence.
This group’s product profile suggests a need for intellectual content, innovative spaces, cultural stimulation, ethnic products, opportunities to purify and re-elaborate, to expand know-how, recover narratives, and diffuse one’s ideas.
The “pleasure growers” are a group of mature westerners over 45 years of age who are rich, accomplished and in search of experience consumption. Their product profile suggests an emphasis on the authentic, on sensory experience, soft adventure, and a dedication to body care and comfort.
Future Concept Lab analyzed the genius loci of Thailand and devised the metaphor “Sense Girls” as a way of approaching these potential markets. This idea of “Sense Girls” represents both the female characteristics of the culture (sensuous and hospitable aesthetics) as well as Thailand’s modern young women (affluent, educated, entrepreneurial and discriminating).
Through this metaphor, they suggest three possibilities for value creation:
“Hypersense” is the Asian capacity to construct vital experiences of poetic and harmonious sensibilities. This aesthetic, for example, leads to cosmetics, healthcare, fashion and other industries.
“Refined Pollination” leverages the ethnic and exotic interacting with elements of global culture creates artistic visions based on an evolving equilibrium of refinement, elegance, cleanliness and perfection.
“Exotic Care” elaborates on the idea of serene aesthetics to offer well-being and relaxation to customers living in increasingly stressful cities around the world.
Approaching a Massclusive Future
Garrick Jones introduced us to the new term “massclusivity,” an idea that describes the kinds of niche market trends that are emerging throughout Asia and the globe. This idea of massclusivity is one that was explored during a collaborative project in Chiang Mai involving 20 students from RCA and 10 Thai designers. Massclusivity may become a much larger trend. “This is not about wealthy people buying wealthy products,” but rather a mass luxury market. Mass affluence has become a reality. This affluence exists in growing numbers of people across the globe who share a level of purchasing power and whose discretionary spending is increasing. Price is no longer dominant. While prices remain competitive, wealth in developed countries is driving the quality of goods up. And, because consumers across the globe are informed, through internet, consumers everywhere know quality when they see it and have access to that quality. There is a growing demand for exclusive and luxurious commodities, while access to those products from across the globe is forcing differentiation up.
Dior took its products down to the streets, out of the world of haute couture, offering the luxury of Dior in a broader context. The brand did not suffer, but the volume of sales went up.
In contrast, Burburry went “too far down too quickly”. The Burburry brand then lost its perceived quality and has had to work to bring that back. However, massclusivity is not just
“big brands coming down market.” We feel the touch of luxury from a sandwich toaster that leaves elaborate patterns on the bread. We are fascinated by tea cups whose unfinished porcelain patterns reveal themselves over time. There is a growth in the culture industry, with modern art museums and avant-garde architecture drawing huge crowds, and biennales in every city. There is a growing number of farmers’ markets in England, and an ever increasing variety of available breads. These are specialities that allow us to “live the dream.” Embodied knowledge is being brought out in new products that feel crafted and rare.
Consumers are also much more actively involved with the products. This involvement includes experiences that are related to products or products that are themselves experiences. The user’s opportunity to “complete the product” is often critical, for example putting one’s own music on one’s personal iPod. Emphasizing the importance of experience, Garrick Jones contrasted his own purchase of an iPod that changed his lifestyle, with a Bluetooth headset he no longer uses, that did not.
Related to experience are the growing numbers of value added services, for which he cited Apple products as a key example. He stressed the emerging importance of meaning and narrative. These narratives support the luxury that is consumed for status; you can buy Mercedes-Benz sunglasses, which evoke the luxury of the car. He talked about our desire for “the it bag”, a massclusive product that offers consumers the luxurious feeling of owning, say, a $5,500 handcrafted Hermes bag. Luxury is often associated with a high level of perceived craftsmanship. Many successful Japanese products deliver that immediate sense of the craftsperson.
This creativity is enabled by communities, mixtures of different people from different cultures working together. With a background in South Africa during the transition, he discovered that working together to create things was a powerful way for people to “get on.” He gave many examples of infrastructures created to directly involve the customer in the creation process. In the case of the iPhone, people are so inspired by the Apple brand that they are putting ideas for the product on-line, providing free research and development. He stressed the importance of playfulness, as well as transparency, ethics, and sustainability. For Thailand, responding to this emerging massclusivity requires both cultural assets and the skills of a creative economy to bring those cultural assets through the many phases of development to the final product. And finally he reminds us of the power, the enduring wonder of “wow!”
Garrick Jones's blog: http://massclusivity.blogspot.com
Creating Innovative Culture in an Organization: Secrets of Success
Tom Kelley the General Manager of IDEO, the largest design company in the world, spoke on the second day of “Creativities Unfold, Bangkok 2006-2007-Perspectives on Value Creation”, the three day International Symposium organised by the Office of Knowledge management & Development (OKMD) and Thailand Creative & Design Center (TCDC)
IDEO, probably the largest and most successful design company in the world with over 3000 innovation projects under its belt, has been using design as a tool or a way to support innovation within their client companies for 30 years.
Kelley as General Manger of IDEO says that ‘design thinking’ can be critical to organisational success. He defines design thinking as a whole brain intuitive process, which can be used not only to create products and services environments, but can also be applied to cities, educational systems, countries, and such larger issues as well.
In order to tap into all this power of design he suggests we need to stretch the traditional definition of design as being some kind of a surface treatment or an after thought that is added on at the end of the process to one that enables innovation right from the beginning.
He supports his argument by quoting industry leaders, business gurus and thinkers:
-Steve Jobs the founder and CEO of Apple Computers says “in most people’s vocabularies, design means a veneer…nothing can be furthest from the truth … design is the fundamental soul of manmade creation”
-Kelley also quotes Tom Peters, one of the top management gurus in the world, who says: “the power of design is to create value, to drive enterprise strategy. …not as a surface treatment but as a strategic tool for companies…..design is the difference between love and hate”.
-Business week in trying to analyse the single most important factor for the success of the 50 best publicly traded companies in North America, found that innovation was the key success factor that makes these companies different and made them rise to the top when other companies failed to do so. “What does matter in this topsy-turvy world where there is no bedrock, no true north, and no preferred market wisdom …is in a word: innovation… the innovators don’t just have new designs; they passionately pursue new ways to serve their customers”.
Kelley says that being an innovator is not enough anymore; you got outpace the competition. According to him, all the companies live in a space governed by what he calls the ‘Red Queen Effect’. Quoting the book Alice through the Looking Glass, he says “If you want to get somewhere else, you must run at least twice as fast as that”
Illustrating this point he gives us the example of how Samsung managed to outpace Sony over a short span of 10 years. Samsung using some of the tools of innovation while working side by side for 3 years with IDEO passed the brand value of Sony by $4 billion by 2005.
Taking examples from his two books The Art of Innovation and The Ten Faces of Innovation, he shares some of the secrets behind IDEO’s phenomenal success. The 2 major factors he describes among many others is IDEO’s ability to understand the latent needs of consumer’s and its ability to experiment rapidly and learn from the failures and successes of those experiments.
Not relying on the consumer’s inability to articulate their future needs, IDEO has perfected the art of anticipating their latent needs by observing what consumers do and why they do it that way. With a childlike curiosity the anthropologist at IDEO interprets human behaviour and then translates those insights into successes.
He says: “trying to find out something new to the world through traditional modes of information gathering does not work….the customer has no idea…customers are never going to help you with the big break through. They don’t know your businesses as well as you do. You should not ask them you should observe their behaviour. You should find their latent needs and find those opportunities out there then solve them.”
He warns designers on the perils of relying too much on their tools & powerful computer aided systems and says that designers must really go ‘out there’ and understand the real problems of consumers.
Replying to a question from the audience he says IDEO with its rigorous recruitment processes hires what he calls ‘T’ shaped people, those with a deep knowledge in one area but with a sufficiently wide range of interests and skills.
According to him, organisation culture for innovation in a company is one with an idea friendly environment….places where you can talk about an idea which isn’t fully formed in your brain without the fear of being laughed at….Fear according to him is not a great incentive for innovative thinking.
Walking Toward Non-Conformity: Shubhankar Ray in Camper Shoes
Shubhankar Ray, whose portfolio includes work for Levi’s and CAT, said he has put fashion behind him.
In Ray’s talk entitled “Culture-Forward, Fashion-Backward: Building Camper’s Brand Value”,
he explained the context behind his six years of brand development work for the footwear label Camper.
As creative director, Ray was faced with the challenge to make Camper more prominent while maintaining its authenticity as a small family business devoted to product and life quality since 1975.
Ray’s solution was to throw away the advertisement convention of creating style and fashionability. In its place, Ray invented a “mindstyle”, which he summed up in the new company slogan: ‘walk, don’t run’. Ray used such juxtaposition to highlight the contradictory identity of the company: based in rural Mallorca (Spanish island), Camper makes urban shoes.
Contradiction is arresting, Ray pointed out. As part of the ‘walk, don’t run’ campaign, Ray initiated a “magalog” (magazine + catalog) called The Walking Society. This publication featured provoking and often controversial photographs – e.g. images of comical Islamic landscapes in the wake of September 11, and of bedouins in Egypt as American troops were invading Iraq. And as if the images weren’t enough, Ray featured politically-charged articles in TWS – on subjects like the anti-car movement, slow food and free software.
It’s making something that everybody notices,” Ray said. That’s worth the risk of getting fired, he added, because
“if you get fired, you can always get another job.”
Not all of Ray’s magalogs were controversial, but all of them were intentionally unfamiliar. He inserted recurring themes that raised eyebrows – like cars and old men playing with sport balls.
“A little bit of confusion is a good thing in a brand,” Ray explained. As Camper was about to open a restaurant called Foodball, he produced a short film for Camper retail shops featuring six waiters playing football with a water bottle at an empty parking lot in Barcelona. There was no explanation for the film, and no explanation for the corresponding issue of TWS, which featured three storylines: shoes, food and shelter. But soon after, Camper announced their launch of Foodball and the Casa Camper hotel – both devoted to healthy and friendly living.
Ray’s technique is “articulating brand strategy without the consumer knowing.” He even waited three years – through half a dozen campaigns – to reveal any image of Camper shoes in an advertisement.
Now in 2006, as Camper faces more competition, one of Ray’s latest tasks is to extend the company image halfway across the globe. Camper has decided to make a line of sneakers,
and to produce them in China. When the company surveyed retailers, they all rejected the idea, for fear of value depreciation. But instead of backing out, Ray released advertisement films connecting Camper mindstyle to Shanghai, China –superimposing familiar phrases like
“Camper means peasant” on an image of Chinese farmers and rice paddies.
Ray said he has enjoyed working for Camper as a “non-conformist culture-oriented brand”. “Making sexy-jeans lifestyle” for Levi’s was fun in his mid-twenties, Ray admitted, but he has begun to wonder about the modern world into which his kids are born.
“Modernity is like diseases and drugs,” Ray said. “It affects your health and can cost you a lot of money... Designers are in a responsible position.”