When people attend classes I’ve taught about strategy or economics, the questions often focus around how brands should approach an innovation and platform strategy. Those questions recently came up again in a different format, so I took notes and decided to start putting some of the most frequently asked questions on my blog. If there are other questions that you’d like to have considered for this post, please ask in the comments.
What do you think about Amazon?
At it’s core, the ideation behind Amazon and other shopping platforms is brilliant.
What started as a simple bookstore and has evolved into a multi-faceted conglomerate of corporations based on always serving the customer is truly a work of genius.
That said, it is my opinion that the engine driving Amazon forward across countries, cultures, and industries, is changing and will continue to change the world’s economy. It could, if it is allowed to run unfettered, also change the fabric of the world’s culture.
Culture can be positively impacted by a platform like Amazon if the organization learns how to come alongside and serve communities. “Service to communities” is not the current Amazon model of learning business models, taking over revenue streams, building warehouses, robotizing assembly lines, and repeating the process in a new industry. A community is built when an existing economy is built and businesses and people in that economy also grow. Amazon has everything in place to make many dreams come true, not just one dream. In an ideal world, Amazon would see that the world is bigger, including Amazon’s, when the global economy grows using their technology.
What is your advice to a new brand working on their own platform strategy?
Build stable sources of revenue.
A long time ago, a wise man was standing in a booth next to me at a trade show and told me about his theory for building revenue around an “army of ants”. Whenever possible, a brand should have many stable sources of revenue and avoid becoming overly reliant on any single source of revenue for success. This advice, while resonant, should be read carefully in context with the knowledge that, as economies evolve so strategies must also evolve.
If you’re present on a platform for your own best interest, that’s fantastic, but if you’re there because you NEED to be there, the relationship is unbalanced and unhealthy.
It is important to protect a brand on all platforms, and, where possible, use all platforms as sources of revenue. However, no single platform should be a brand’s primary source of revenue.
What about intellectual property protection?
Protect your intellectual property.
Patents, copyrights, and trademarks are important.
The innovation process can be complex and slow. It can also be simple and fast. The key to success is to define your process and then to work that process repeatedly.
How can I be successful as an inventor?
The process of innovation is as important as the innovation itself.
- Give yourself space.
- Honor your process.
- Surround yourself with people who know how to work with you.
- Remove people from your space who can’t work with you.
- And most importantly, remember, you did it before.
- Once you’ve learned your process, write it down so you can do it again.
Why are you selling on Amazon?
- To be accessible.
Many shoppers choose Amazon for convenience.
- To make money.
Amazon is driving nearly half of keyword searches for all retail in the entire United States.
- To protect the brand.
Brand protection is important for major brands. At this time, we don’t know what would happen if we entirely abandoned the marketplace. Would counterfeit products take over? Trends are following this pattern in other parts of the world. As brands, we watch these trends with concern. Regardless of my opinions about competition, anti-trust, and market changes, positioning our brand protectively on all platforms is essential to the future of the company.
Should I be concerned about counterfeits?
While Amazon has taken some steps to counter issues with counterfeits on their platform, authentic brands continue to be plagued by copies of their products on the marketplace.
Amazon’s Brand Management Tools:
How do you think about brand strategies in relationship to competition and growth?
As we look at growth opportunities, we try to consider the potential long-term impact of the decision that we are making. An opportunity that looks good today has to be measured against long term competitive and growth issues within the segment. These are complex issues that require a broad understanding of the category, as well as business and legal issues facing the evolving marketing and sales landscape for brands.
Do you use consultants or other resources?
Generally speaking, consultants and other resources have a good understanding of marketing and the tools available to brands on platforms. This can be helpful to facilitate revenue growth. When a firm is able to also understand the legal implications of sales in domestic and foreign marketplaces, that takes their services to the next level. While we are always learning, we have decided to use internal resources to inform our platform strategy at this time.
Do you do consulting?
Yes. Please visit Wicket Workshop for more information about my consulting business designed to support ideators and product developers in their journey from idea to shelf.