Selling Lifestyles

To use Jim Collins’ phrase, I believe that these days the difference between “good and great” companies is how they manage to sell the idea of a lifestyle. I’ll explain why I think this using two companies in two different industries.

Firstly, Abercrombie & Fitch. They died as a company two times before becoming the phenomenon that they are now. They’ve always been known to sell incredibly high-quality products made from good materials. But that didn’t stop them from filing for bankruptcy once and then being bought out. Abercrombie then brought in a new CEO, Mike Jeffries, who created the new concept for A&F. He wanted this new concept to allow people to think that they’re in a movie. He also wanted the brand to “sizzle with sex”. Abercrombie sells the lifestyle of sexy college students.

Look at the difference in approach. When the brand failed, it focussed on product first and foremost. It made a great product, but with no image or lifestyle, people didn’t buy it. After Jeffries came in, A&F put their lifestyle image first, backed up by a super high quality product. And now they’re smiling all the way to the bank (they’re a multi-billion dollar company).

Look at Apple, too. Apple has always made high-quality products. But it almost failed years ago, because it didn’t have a lifestyle with which people could buy into. Then Jobs came back, and created the “think different” lifestyle that creative people could buy their products to become a part of. I don’t need to explain their success since then.

The point is, you can’t be a great company with just a great product. There are thousands of companies with high-quality, functional products, that are on the verge of failing because no one will buy the product. To be a great company, you need to have a lifestyle that people want to buy into by buying your product. The more compelling the lifestyle that you sell, the more you can charge for your product and the more people will want it. Abercrombie raises its prices every single year, and yet demand for their products rises faster every single year – the Abercrombie lifestyle is so strong that it even makes the law of demand invalid (in economics, it’s called a Veblen Good). This is the situation you want to be in as a company. Think about it – you raise your prices and even more people want to buy your products!

I don’t think that selling a lifestyle is something that only physical-good companies can do. I believe that web apps can do it as well, and indeed many should think about it more seriously. One app that I believe should really focus on creating a lifestyle to sell is Path. The new version of their app is fantastic, and they’re seeing huge numbers of people begin to use it. But Path, to me, is about sharing my life with the people who are close to me. Path’s job, then, is to make me want to share more of my life. And I think the best way for them to do that is to create a broad lifestyle image for people to want to buy into. They should create an image that means when someone sees me using Path, it says something about me and my lifestyle – “I’m tech savvy, value my close friends and family, and want to share my life with them as well as see their lives”.

Every web app can sell a lifestyle of some sort. It might not be as elaborate as Abercrombie’s, as you don’t have a physical store for people to walk around in, but you can create it through your app and website.

I’ll repeat the key point I’m trying to make in this post – that it’s not enough to make a fantastic product. To make your company great, I believe you need to sell a lifestyle through a high-quality product.

How To Bring Handwriting Into The 21st Century

I think better when I’m physically writing with pen and paper. There’s something about it that lets me map out my thoughts more effectively, and think in broader terms. When I’m writing on a computer, or an iPhone as I am now, I feel more confined and stuck within a specific format.

I can’t explain why this is, beyond saying that it’s either personal preference or a result of the fact that I wrote on paper before I typed. But because of it, I usually map out my thoughts on paper before I take to a computer to type. By doing this, I find that the end result of my writing is usually always better.

If you read my blog often, you’ll know that I have a love-hate relationship with paper. I try desperately to eliminate it from my life (and do pretty well) but love writing on it. I want all of my writing to be stored digitally (in Evernote), even things that I’ve handwritten.

There are ways for me to do this, and I’ve tried them. Livescribe is one solution, but it’s too much of a hassle to make it worthwhile.

For those of you who don’t know, Livescribe is a specific pen (a very chunky, uncomfortable to hold one), that allows you to write on a specific type of paper and have your notes converted into a digital format when you plug the pen into your computer. You cannot write on your own paper  - it has to be Livescribe’s paper, which is covered in tiny dots that the pen can read.

I’ve tried Livescribe a few times and have never been taken with it. I want to use my own paper, and write with a normal-sized pen, and have all my notes automatically converted into a digital format and sent to my Evernote account. I’ve even thought up a concept that I believe could work, which I’ll explain here in case a brilliant engineer or inventor happens to read this. Please bear in mind that I do not have an engineer’s brain, and I don’t have a proper idea of how this would be built or the exact technology involved in it.

I envisage a normal-sized pen, that is comfortable to hold. It has a small screen on the side (similar to Livescribe) and is connected to the Internet via 3G (like Amazon Kindles). Inside the pen is an accelerometer and a gyroscope. You simply write on any paper you want, and the accelerometer and gyroscope pick up the movements that your hand is making and convert those movements into letters, which are then sent wirelessly to Evernote’s servers. This, in my opinion, is the best solution. It means you don’t have to be locked into using Livescribe’s paper, plus it removes most of the hassle from the process.

To be honest, I’m only guessing as to whether an accelerometer and gyroscope can pick up the movements that our hands make. But it’s an educated guess – from seeing what an iPhone can do, which has the same technology inside it, it seems likely that this could work.

If this was built, I’d be a bloody happy guy. I could write with pen and paper, which I love, but never have to worry about keeping the paper or having it with me, as I’d have all my notes accessible on my iPhone in Evernote, wherever I am. I believe this is a way that handwriting can be brought up to date with modern technology.

If you’re an engineer and read this – would you mind letting me know your view on the feasibility of producing a pen like this? And if any of you have heard of an existing technology like this, or another alternative, please let me know!

The Unfairness of Tech Startup Coverage

Here at LeWeb Andrey Andreev, the founder of a company called Badoo, was just interviewed by Loic LeMeur on stage. I follow the vast majority of all tech news in the week, and for some reason Badoo has just escaped my radar. Either it was just a weird accident that I’ve never read anything about Badoo, or there’s something else going on.

If Badoo was a brand new company with hardly any users, it may be more easy to believe that I just missed news about them. However, Andrey announced on stage that they have 150million users and are doing over US$100million in revenues. That’s hard to miss. That’s pretty monumental.

For those of you who don’t know, Badoo is a social network that lets you “meet people around you”. In other words, it’s an app to let you meet people and flirt. Not quite a dating site, but close to one.

The issue I want to tackle here is why I hadn’t heard about Badoo, when they’re one of the top European company success stories of the past year or so.

It seems as though we hear in great detail all the news about every tech startup in Silicon Valley, but don’t hear much about startups elsewhere. There are probably a few reasons for this. Firstly, Silicon Valley itself IS the tech industry. For that reason, there’s a huge amount of media there that solely focusses on reporting on new startups. This means that we are sure to hear about Silicon Valley startups. On the other hand, cities in Europe or Asia aren’t solely tech focussed. Therefore there isn’t the same amount of media that cover new tech startups, and many hot new startups get missed by the international media.

Secondly, I believe that other cultures idolize tech startups less. In the US, especially after Facebook and The Social Network movie, it’s “cool” to be a tech startup. This means that the media there actively look out hot new startups so that they can get a scoop. But in other countries its not cool to the same extent, and again we see less coverage of tech startups.

There’s a huge list of tech startups in Asia and Europe that we just haven’t heard about. Many of them are far more successful than startups receiving extensive coverage on TechCrunch or any of the other Silicon Valley news sources. But because no local media is that interested in them, they don’t get covered as often or to the same extent, and the international media never hears about them. I’m by no means just talking about Badoo here.

TechCrunch has writers on the ground in many different cities, but they aren’t in all of them. We can’t just expect coverage of international startups. And unless there is more interest in local cities in Asia and Europe in the tech industry, we can’t expect more coverage from local media. So what’s the answer?

I don’t really believe there is one. I think that the reason Silicon Valley startups receive so much press is because that’s what makes Silicon Valley great. It’s part of the reason why startups go to Silicon Valley – so that they can receive press coverage and interest that they simply wouldn’t receive elsewhere.

Therefore perhaps the only way to increase local media coverage of startups elsewhere in the world is to turn those cities into tech hubs. That’s a huge task, and I’ve written a post with my thoughts on it before. I don’t actually see any cities being turned into a tech hub anytime soon. The media coverage is part and parcel of Silicon Valley, and if you want that type of coverage you’re just going to have to go there.

This got me thinking at the very least. Interested in everyone’s thoughts!