Four SXSW Takeaways

Michael Tchong innovation, trends

SXSW was, as usual, a spectacle to be experienced. Here are some key takeaways:

  • Multitasking events – SXSW may remind you of the COMDEX conferences of yore, but with a twist. While there were many corporate parties at that long-forgotten Las Vegas event, most did not feature “content” as the main draw. Lesson: business prospects like to be entertained and informed because we need to multitask everywhere.
  • Affinity targeting – SXSW proves that the old rule of “precision targeting” is less relevant today. The exhibit hall featured a panoply of B2B video services, consumer audio, marketing services, 3D/AR/VR vendors, entire countries trying to attract startups, robot makers, and more. In other words, there is no easy way to define the SXSW audience, except to say that they’re all interested in the latest and greatest innovations. It is perhaps the best personification of this popular new marketing focus on social media influencers.
  • Social good – The SXSW Super Accelerator featured 50 startup pitches and ended up choosing 10 finalists in as many categories. The best Startup Pitch winner was an Oakland-based fintech company, CNote, which offers users a “40x better return on their savings with 100% social impact.” CNote offers a 2.5% return and invests its money in social good projects. Social good tie-ins will clearly play a major role in future revenue streams and marketing expenditures. Millennials like these tie-ins and these messages resonated loudly in Austin.
  • Future, now – A special award for the most innovative startup went to Helixworks Technologies, which has devised an open architecture method to store digital information in DNA. As Helixworks’ site trumpets, “We provide technology to immortalize your memories, thoughts or just plain binary data into a medium that can stand the test of time.” Think of it, you will soon be able to store your best ideas not only for posterity, but the way transhumanists envision it, maybe one day even be resuscitated as “RoboInnovator.”

As the accompanying photo shows, even Austin’s street bands have decidedly edgy branding. No wonder the capital of Texas’ motto is “Keep Austin Weird.” See you at SXSW next year! 😄

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Michael Tchong

Michael Tchong
Michael is a professional people watcher and founder of four ahead-of-the-wave startups. He’s also a top-rated innovation and trends speaker, and an adjunct professor of innovation and social media at the University of San Francisco and the University of California at Berkeley.

Yoga Culture

Michael Tchong innovation, trends

Propelled by life’s mounting stresses, a by-product of the Time Compression Ubertrend — the acceleration of life, the practice of yoga has exploded in the past 40 years.

Yoga is now practiced by more than 200 million, according to the Hindustan Times (26-Jan-13) people worldwide, including over 100 million in its country of origin, India.

Yoga Journal’s “Yoga In America” study has traditionally been the go-to source for yoga universe data, as well it should. Yoga Journal began publishing in May 1975 with an initial print run of 300 copies. Today, it is the world’s largest yoga magazine with a circulation of 375,000.

Over the years, Yoga Journal has relied on at least five different research companies to study the market, including Roper Starch (1990, 1994), Wall Street Journal/NBC (1998), Harris Interactive (2003, 2005), Sports Marketing Surveys USA (2012), and IPSOS Public Affairs (2016). The magazine appears to have conducted its 2008 survey in-house.

Along with these changes, estimates of U.S. yoga practitioners have varied widely, including two dips during the decidedly downward dog days of 2002 and 2008, which almost certainly were also impacted by a change in research methodology.

In 1994, Yoga Journal reported that “over 6 million Americans practice yoga (3.3% of the population)—1.86 million of them regularly.” That was up from 4 million in 1990.

An analysis by Trisha Lamb for the International Association of Yoga Therapists raises several red flags. For example, a 1998 Wall Street Journal/NBC poll found that the number practitioners had tripled between 1994 and 1998 to 18 million. On June 16, 2003, the magazine walked that figure back, providing a more down-to-earth 15 million estimate.

Lamb cites a Yoga Journal statement about the 2003 Harris Interactive poll that found that “over 7% of U.S. adults, or 15 million people, now practice yoga, an increase of 28.5% from the year prior.” That increase suggests a more accurate 2002 figure of 11.6 million and not the 28 million estimated earlier.

That’s a significant discrepancy because as Lamb notes, “we are uncertain how the prior-year figure was determined since Yoga Journal’s estimate for 2002 was 18 million practitioners.” And that number doesn’t even include the 10 million estimated to have begun practicing yoga for the first time in 2002, according to the magazine.

Part of the discrepancy may be the result of Yoga Journal halting its practice of reporting entry and core (regular) practitioners, providing only an estimate of total yoga users:

Yoga Journal Study Comparison

Type199019941998200220032005200820122016
Source: 1990, 1994 Roper Starch; Jun-98 Wall Street Journal/NBC Poll; 16-Jun-03, 07-Feb-05 Harris Interactive Service Bureau; 05-Dec-12 Sports Marketing Surveys USA; 13-Jan-16 IPSOS Public Affairs.
Entry Practitioners1.0M1.2M9.5M10.0M
Core Practitioners3.0M5.0M9.0M18.0M
Total Practitioners4.0M6.2M18.5M28.0M15.0M16.5M15.8M20.4M36.7M

Lamb’s 2004 report notes a plateauing of interest in yoga in 2002 and 2003. Yoga Journal claimed that its 2005 projection of 16.5 million was up 43% from 2002, providing further evidence that the actual 2002 figure was 11.5 million and not 18 million. The most recent study, conducted by Yoga Journal and Yoga Alliance, cites 37 million practitioners in 2016, up an astonishing 80% compared to 2012.

By contrast, a 2015 National Health Interview Survey (NHIS) found that 9.5% of U.S. adults, or 21 million, used yoga as a complementary health approach. The chart below incorporates NHIS data to provide a more consistent historical growth trajectory.

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Why is this data exercise so important? Many key players, including apparel suppliers, financial analysts, and other parties, rely on these results to generate growth projections and calculate market penetration.

There is no question that the yoga market has grown, as our normalized chart indicates, and its popularity has lifted the fortunes of a host of ancillary businesses, including fitness clubs and yoga apparel maker Lululemon.

The latest Yoga Journal and Yoga Alliance study reports that currently 70% of yoga practitioners are women. By comparison, the magazine reported in 2012 that 82% of practitioners were women, while 72% were female in 2008.

The ascendancy of a female dominated sport provided an opening for Canadian entrepreneur Chip Wilson, who opened the first Lululemon store in Vancouver in 1998. Wilson’s timing was impeccable, as the “athleisure” trend was about to kick into high gear. Yoginis eagerly wore trendy Lululemon Groove pants and tops to yoga class, or while shopping or even out to dinner. Lululemon fans helped drive sales to $1,675 per square foot, placing the popular retailer in fourth place behind Apple, Tiffany’s and Michael Kors. 

When Lululemon Athletica made its stock market debut on July 27, 2007, its shares rose 56% to $28 on the first day of trading, giving the company a market value of nearly $2 billion. With 363 stores today, Lululemon shares now trade around $64 and the company’s market cap approaches $9 billion. 

And yoga still has much more upside potential. Its biggest boost came in a January 2013 study conducted by Duke University researchers who reported that yoga is a promising treatment for mental illnesses, including mild depression and sleep disorders.

Expect more hotels, like New York’s EVEN Hotel to offer yoga, because as The New York Times recently wrote, “To court millennials, hotels are rolling out the yoga mat.”

Namaste!

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Michael Tchong

Michael Tchong
Michael is a professional people watcher and founder of four ahead-of-the-wave startups. He’s also a top-rated innovation and trends speaker, and an adjunct professor of innovation and social media at the University of San Francisco and the University of California at Berkeley.

Top 10 Innovators

Michael Tchong innovation

Like that year-end ritual where some organizations claim to be able to pick the hottest trends of the next year, some market watchers compile lists of the top (fill-in-the-blank) most innovative companies. As much as trends do not adhere to calendar years, innovators defy ranking.

A few weeks ago, Fast Company did its best to try to shoehorn 50 companies into such an arbitrary list, placing Amazon at the top of the list for “offering even more, even faster and smarter.” Really?

And then there’s No. 2 Google, which merits its ranking for “developing a photographic memory,” You mean that photographic memory that had Google Home spewing fake news? Or is it because of Google’s search algorithms, developed way back in 1999, which are now picture perfect?

Then there’s No. 3 Uber, which ostensibly is “accelerating autonomous driving” — accelerating it so much that one of their self-driving cars ran a red light in San Francisco. Read the list for yourself and start wondering.

At least Fast Company did not repeat the faux pax Insead committed back in 2013 when it named Salesforce.com the world’s most innovative company. Their yardstick? A financial metric.

That was a complete joke. If you’ve ever heard how much people complain about using Salesforce.com, then you know there’s no way this company could be named the world’s most innovative company.

No, innovative companies create breakthroughs. They materially rewrite the rules for market sectors. And yes, it’s not easy to choose who belongs because one has to consider a number of factors to make a list of top innovators, besides profitability or company value.

The companies we chose are category disrupters. They prove that constant innovation drives success. Our picks are not ranked but simply listed alphabetically and include a concrete rationale behind each choice:

AirBnB
AirBnB introduced us to the concept of “home optimization,” offering homeowners the same opportunity to boost their cash flow that major airlines have enjoyed for years. AirBnB is a genuinely disruptive innovator. That is evident from the 70 million guests who have discovered the joys of using AirBnB, making it the world’s largest hotel chain in the span of just ten years. And their success makes them a major topic of conversation at every travel conference.

Apple
No innovation list would be complete without the iPhone, which has completely reinvented the way we live our lives today. In nearly ten years, Apple has sold 1 billion iPhones, making it the most successful product in retail history. In a little over a decade, the iPhone vaulted Apple from a company that was down $2.6 billion in fiscal 2001 from the $8 billion recorded the year before to the world’s most valuable company. Cupertino could not have done that without breakthrough retailing, featuring stores without cash registers and a Genius Bar that still has no equal.

Domino’s
Here’s a company that promoted the fact that its pizzas used to taste like cardboard. Know of any other company that has publicly admitted that its products used to suck? Many companies should do the same, AT&T and Yahoo! come to mind. But Domino’s has continued to innovate relentlessly, with a host of novel ways to order pizza, from emoji tweets to Amazon Echo. But the best innovation of all is its pizza tracking, which still stands alone in the pizza category today, despite being launched in 2008. Not surprisingly Domino’s revenue growth continues to outpace the entire industry, growing at quadruple the rate based on the latest figures available.

Google
Google is a company that defies description. It generates most of its revenues from an amazingly ugly and user-unfriendly product, AdWords. Yet it lumbers into markets like a classic 800-pound gorilla with some remarkably elegant and innovative solutions, like Google Maps, Inbox and Cardboard. Some 10 million Cardboard devices have been shipped, enabling the exploration of virtual reality for a broad cross-section of the population. For that is has to be commended.

Nest
Yes Google owns Nest, but the company that Tony Fadell started has acquired a sterling reputation for creating a truly innovative, smart thermostat and packaging it in a very elegant way that even includes one of the most beautiful screwdrivers you’ll ever see. Nest’s interface is well-designed and intuitive. Its app is the sine qua non. We can only hope that other players will see the light and follow Nest in its footsteps because consumers need more encouragement to join the smart home revolution.

Square
Before Square, accepting credit cards wirelessly required filling out a lengthy merchant account application, undergoing a credit check, paying activation fees, leasing or buying a wireless terminal, and paying separately for wireless access. It was a real shit show. Enter Jack Dorsey, the Jack Black of digital retailing. His company’s invention: transmit a credit card’s magnetic stripe data via the iPhone’s headphone jack using a free Square reader. Square lets millions of small merchants ring up sales anywhere, anytime. Capitalism loves freedom, and we all love our Square reader.

Starbucks
What can you say about Starbucks that hasn’t been said before? Howard Schultz is not only a visionary, but a man with a mission and his imprimatur is indelibly written all over this remarkable chain of restaurants. Who else but Schultz could convince millions each day to fork over $4 for a cup of coffee? Starbucks did it by being the first with an iPhone app, first with an electronic payment system, first to put a Starbucks on a cruise ship, and first to gamify a loyalty program. Starbucks also treats its employees right with profit sharing, free education, and healthcare. McDonald’s and crew would be wise to pay heed, for happy employees means happy customers.

Tesla
One has to wonder why more multi-million-dollar-compensated CEOs can’t think the way Elon Musk does. He asked two simple questions: “Why can’t we build a great electric car?” And “Do I have to sell through retailers?” The resounding answers are clearly “Yes” and “No.” It takes cohones to be a disruptor, and that’s probably what all those over-paid CEOs lack. Tesla has scared the heebie-jeebies out of the entire automotive industry. And rightly so, they were all asleep at the wheel.

T-Mobile
Need more evidence of what cohones can contribute to a company? Look no further than T-Mobile. Here’s a player that inhabits a horrible market. Carriers rank right behind Comcast in sheer likeability. Enter John Legere with his “Uncarrier” shtick. His tireless quest to upset the apple cart has brought an entire industry to its knees. Remember how AT&T and Verizon famously abolished unlimited plans a few years ago? Hilariously, AT&T had to cave twice in just the past few weeks after it realized how lame its “unlimited” plan was compared to T-Mobile’s. Can you hear me now?

All of the above companies live and breathe innovation. It’s in their DNA, and the ripple effect they cause is proof positive that being innovative obliterates the status quo. The sad thing is that there are 265 million businesses in the Dun & Bradstreet global database, yet it’s difficult to come up with ten that resoundingly deserve to be on our list. We need to fix that.

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Michael Tchong

Michael Tchong
Michael is a professional people watcher and founder of four ahead-of-the-wave startups. He’s also a top-rated innovation and trends speaker, and an adjunct professor of innovation and social media at the University of San Francisco and the University of California at Berkeley.

Grayfields

Michael Tchong trends

A key parameter of retailing, sales per square foot has fallen precipitously at public retailers from an average of nearly $375 in the early 2000s to around $325 in recent years, reports commercial real estate research firm CoStar, citing U.S. Census, Moody’s Analytics and CoStar Portfolio Strategy data.

Ouch! What’s driving this trend? Three phenomena:

  • Digital Lifestyle Ubertrend – The Digital Lifestyle Ubertrend is reshaping shopping habits, with the “Amazon Factor” clearly at play here. Amazon.com has reportedly signed up some 66 million U.S. Prime members — without a doubt most of America’s top buyers.

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  • Time Compression Ubertrend – Not only is it more convenient to shop online; it requires fewer resources. Shoppers save on gas or public transportation and, as BusinessWeek observed in May 2005, “The typical one-hour trip to the mall costs about $30 at the average hourly pay for managers and professionals.” Then there is the Time Compression Ubertrend, which is making everyone crazy busy.
  • Their worst enemy — The retail industry’s wounds are partially self-inflicted. Capgemini reported in January that “a third of consumers would rather ‘wash the dishes’ than shop in-store.” While that means that two-thirds are still OK with shopping in brick-and-mortar stores, the question is for how long? USA Today reports that millennials are killing department stores, noting that traditional retail is ill-equipped to address the needs of this generation.

Another issue is that for years now, retailers and analysts have fixated on the large gap between U.S. retail sales, which were projected to reach $5 trillion in 2016, and “puny” U.S. e-commerce sales of $395 billion (PDF).

The fact is that those 66 million Prime customers constitute the lion share of foot traffic and sales at traditional retailers. Absent frequent buyers, retailers are collapsing, abandoning shopping malls, whose gray, hulking masses are fueling a trend dubbed “grayfields.”

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Michael Tchong

Michael Tchong
Michael is a professional people watcher and founder of four ahead-of-the-wave startups. He’s also a top-rated innovation and trends speaker, and an adjunct professor of innovation and social media at the University of San Francisco and the University of California at Berkeley.

Smart Home

Michael Tchong innovation, trends

You know that the smart home innovation has arrived when a CES 2017 exhibit hall in Las Vegas is teeming with Alexa-driven or other platform-connected air purifiers, mattresses, refrigerators, toasters, toothbrushes, trash cans and even an innovative connected hair brush, the Kérastase Hair Coach!

Google acquired Nest in January 2014 for $3.2 billion, signaling that the “connected home” or smart home trend had arrived in full force. Innovative smart home devices are multiplying at a dizzying clip. And any device that is connected to the internet is considered a member of the rapidly growing Internet of Things (IoT) trend.

According to Statista, the smart home market, which includes home automation, security, entertainment and ambient assisted living (AAL) will grow from $15 billion to $32 billion by 2021:


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Factors driving growth include:

  • Smart home controllers – Smart-home controller or “hub” shipments are predicted to reach 3 million by 2018.
  • IoT forecast – The installed base of active wireless connected devices, of which the Nest Learning Thermostat ($247) is a prime example, will reach 41 billion by 2020, according to ABI Research. Gartner is slightly less enthusiastic, predicting an installed base of IoT devices of 26 billion by 2020. Both forecasts include industrial connected devices.
  • Market demand – A Lowe’s study (PDF) found that 70% of consumers want to control something in their home from their mobile device without getting out of bed, a shocking finding! 😁 And 62% find smart home controls most beneficial for monitoring safety and security, equally unsurprising.

Platforms

The three major platforms trying to wrest control of the smart home market include:

  • Alexa – When Amazon.com launched is Amazon Echo speaker ($180) on June 23, 2015, no one expected that the nine-inch (24 cm), voice-driven audio speaker would become the huge hit it is today. Amazon’s Alexa home assistant now boasts more than 10,000 skills, or third-party apps, including the ability to order pizza from Domino’s, raise your Nest thermostat or turn on your Philips Hue lights. At CES 2017, a host of connected home devices showed off new ways of interacting with your Echo speaker. There is no question that today, Alexa is the dominant smart home voice platform.
  • Apple HomeKit – On June 13, 2016 Apple launched Home, a single app to manage its HomeKit platform, which lets iOS users control locks, lights, video cameras, doors, thermostats, plugs and switches. The platform offers secure pairing and is able to control gadgets separately or set automations for device groups. Home can be operated with Siri voice commands, so just saying “time for bed” will turn off lights and lock the front door.
  • Google Home – In October 2016, Google launched its voice-activated speaker powered by the Google Assistant. Developers can now create “Actions” for Google Home, which are the company’s equivalent of Alexa Skills.

Products

There are far more smart home products that support the three major platforms, but due to space constraints, we’ve limited our this smart home buying guide to the most significant products:

  • Belkin WeMo – Los Angeles-based Belkin debuted its WeMo line of connected devices in 2013, including a WeMo-based Crock-Pot ($109) at CES 2014. The Belkin WeMo Switch ($35) is Amazon’s second best-selling smart switch.
  • Logitech – The Logitech Harmony Elite remote control ($298) relies on a hub and app to work with Alexa.
  • Nest – The Nest Learning Thermostat is unquestionably the best smart thermostat, and at $247 not cheap, but its app, interface design and packaging are superb. It’s the Apple of connected home devices, which also includes their first-rate Nest Protect ($99) smoke alarm.
  • Philips Hue – Philips’ third-generation Hue White and Color Ambiance A19 Starter Kit 464495 retails for $200 and lets you instantly add a rich palette of colors to your home milieu.
  • TP-Link – What set TP-Link smart home devices apart is that they do not need a hub or controller. The company has just launched the TP-Link HS105 Smart Plug Mini ($35), which occupies just one AC socket and also works with Alexa.

The best way to jump into the smart home market now is to buy an Amazon Echo plus a smart LED lighting system, like the Philips Hue, or TP-Link Smart Plug and Smart LED Light Bulb. You will be very happy you did.

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Michael Tchong

Michael Tchong
Michael is a professional people watcher and founder of four ahead-of-the-wave startups. He’s also a top-rated innovation and trends speaker, and an adjunct professor of innovation and social media at the University of San Francisco and the University of California at Berkeley.

Screensucking

Michael Tchong trends

Christmas 2015 was a beautiful day in San Diego. Joshua Burwell, a 33-year-old visiting from Sheridan, Ind., decided to hike Sunset Cliffs to watch the sunset. Witnesses noticed someone distracted by an “electronic device” seconds before Burwell plunged off the cliff. He was pronounced dead when paramedics arrived.

It was another example of the intoxicating spell our digital devices cast on us. The ability of our phone screens to literally suck us in is fueling the screensucking trend — a lifestyle habit that is distracting the world around us.

And it’s truly a global phenomenon. In China this past November, a surveillance camera captured a Chinese woman glued to her phone while ignoring her two-year-old daughter. A slow-moving S.U.V. then ran over the toddler, killing her.

Some of these bouts with distraction end well. In perhaps the first recorded incidence, a Japanese woman walked off a subway platform in 2007 while texting. In 2011, a 10-year-old Italian boy fell off a Milan train platform while playing on his Sony PSP.

But perhaps the most infamous screensucking incident that captured media attention worldwide was Cathy Cruz Marrero stumbling into in a shopping mall fountain while texting.


In 2011, Cathy Cruz Marrero famously fell into a shopping mall fountain while texting. A shopping mall spokesperson says a guard was fired in connection with the incident.

Screensucking is also to blame for causing Americans to sleep less. In the 1920s, the average person enjoyed 8.8 hours of sleep each night. Today, we sleep two hours less, or an average of 6.7 hours during the work week.

The Wall Street Journal reports that “emergency room visits involving distracted pedestrians using cellphones were up 124% in 2014 from 2010 — and up ten-fold from 2006.” Meanwhile, the latest AAA Traffic Safety Culture Index survey found that more than 40% of respondents admit they’ve used their phones while driving.


LG 8K LED TVThe situation has gotten so bad that traffic signs are going up around the world to warn drivers about distracted pedestrians, like this one in Sweden. Of course this assumes that the driver will look up from his or her phone to notice the sign.

Will we ever be safe from all these screen diversions? Not unless we give up screensucking, which is highly unlikely.

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Michael Tchong

Michael Tchong
Michael is a professional people watcher and founder of four ahead-of-the-wave startups. He’s also a top-rated innovation and trends speaker, and an adjunct professor of innovation and social media at the University of San Francisco and the University of California at Berkeley.

Pioneer Rayz: When Opportunity Knocks

Michael Tchong innovation

Apple’s decision to remove the audio port from the iPhone 7 resulted in a public outcry of world-ending proportions. To some Apple aficionados it was armageddon meets invasion of the headphone port snatchers.

But as any creative individual will tell you, problems spell opportunity. And so Pioneer this week launched its Rayz headset that adds a Lightning port to its cable, letting iPhone 7 users to charge their phone while using the headset. The Rayz Plus model ($150; PDF) sports a Lightning port and snappy metallic finish, while a $100 Rayz model (PDF) dispenses with Lightning port and features an ordinary black finish.

I’ve been using the Rayz for more than a month now and it’s an outstanding headset. Not only does it do a great job with music and phone calls but the accompanying Rayz app is elegantly designed and fun to use. When you first plug your headset in, the app will calibrate it to your ear canals. A smiling emoji tells you when the personalized scan of your ears is done. The app also lets you control such settings as adaptive noise canceling, equalizer, HearThru, which lets you listen to ambient sounds, and auto pause, which pauses music when you take the earbuds out.

Besides excellent sound quality, the Rayz features first-rate packaging making it an accessory that matches Apple in look and feel.

Simplicity

Michael Tchong ideation, trends

Welcome to our simplified site. Every few years, we review how our digital outpost has evolved and ubercool version 14.0, the previous iteration, had clearly become too complex and unwieldy, making our innovation and trends content hard to navigate and updating a major challenge. So we scrapped it all and are beginning from scratch.

You too should periodically review your product and service offerings and try to simplify not only your line up but also your messaging. Does it still reflect what you’re trying to convey? Is it serving a need? Does your brand look and feel remain approachable?

In a world where complexity has become the norm, it’s increasingly evident that a new mantra of simplicity has to start somewhere. As The Wall Street Journal reports, in 1980 the typical credit card contract was about 400 words long. Today, many are 20,000 words. Is that really necessary?

So we’re kicking off a K.I.S.S. campaign. Eliminate unnecessary gimmicks, as we did, because the typical visitor spends just 75 seconds viewing the average web page. Harmonize your life by getting rid of clutter as Marie Kondo advices. Simplicity pays off. Just ask the the world’s most valuable corporation.