Since leaving an industry-leading company after 23 years to forge a new path in the housewares industry, three and a half years have passed, and my view of the industry has changed dramatically. This time has allowed me to challenge many of my previous perspectives while testing some hypotheses about how our industry is evolving in the never-ending chase to connect with our end consumers and continue the development of new products that ultimately motivate the marketplace to keep coming back.
I have come to believe there is an epidemic failure in our industry that starts with most companies not even really understanding what they do or why they do it or how to connect with the end consumer they claim to covet so preciously. It’s an imperfect understanding of the game, and our industry seems to be falling increasingly behind. You’ve probably heard part of that phrase from Simon Sinek’s Ted Talk, and the other part gives homage to a scene from the baseball movie Moneyball.
As I sat down to write this blog and put my thoughts into words, I had so many ideas, thoughts, speaker’s words, and movie clips rolling around in my head that I didn’t know where to start or how to organize the details of what I wanted to say other than opening the dialog of this article with a jarring comment that might entice the reader to read on. Based on my levied allegations, I also understand my words might offend a few in our industry. I will go on to say that challenging the status quo is what makes us better and, ultimately, what propels companies and industries forward.
In a few words, our industry has grown complacent and tired.
Are our Industry Associations and Trade Shows evolving to keep up with how things are changing? I’m not so sure.
Many companies continue doing the same things they’ve done for 30 years and then wonder why nothing seems to change. I recently read a post on LinkedIn, I don’t know where to give proper credit, but the comment was, “The most expensive seven words ever used in the corporate world: “That’s the way we’ve always done it.” To quote an overused phrase, “The definition of insanity is doing the same thing repeatedly, expecting a different result or outcome.”
With what is happening in the US and global economies today and after two years of unprecedented Industry Growth and High-Fives all around, thanks to the Covid Pandemic, I believe the industry stands on the brink of one of the most significant shake-ups we have ever witnessed. I will speak specifically about the cookware industry as most of my career’s last 30 years have focused on this category.
The industry’s major players are stagnating in their thought process of changing this handle or that body silhouette. They add a new color, or they do another licensing deal, adding another celebrity name to the endless list that already exists. In the end, the technology remains the same with a few minor adjustments, and the well-embedded mindset of “just spray some coating on another piece of aluminum and the consumer will come” continues to be the mantra that motivates the industry to carry on.
As I write this, thoughts of the movie Jerry McGuire and the “Mission Statement” roll around in my mind. If you haven’t seen the movie, look up the mission statement clip on YouTube and the repercussions of putting such thoughts on paper. Am I bagging any future hope of a career in the industry I’ve come to love after close to 30 years? Maybe and probably, land with a resounding thud.
Why is attempting to think differently viewed with such disdain? This is a question I’m not sure I’ll ever know the answer to, but it may lie in another movie clip from Moneyball, “The Boston Job Interview.”
Thinking Differently: “It’s not just threatening a way of doing business, in their minds, it threatening the game, it’s threatening their livelihoods, it’s threatening their jobs, it’s threatening the way they do things, and every time that happens, whether it’s a government, or a way of doing business, or whatever it is, the people who are holding the reigns, or have their hand on the switch, they go batshit crazy.”
As I consult with companies, I have a questionnaire that I ask to be completed before our initial consultation and engagement. The first question I ask is often a bit off-putting, but when a company defines a strategic approach to entering the US market, I ask, what gives you the right to enter the US Market? This question is often followed with a blank stare and comments like, “we make a nice product” or “what do you mean?”
I respond by saying you are looking to enter a super fragmented industry segment, low tech, and the barriers of entry are low. Currently, industry data shows 30 brands make up the top 80% of the market, with another 30 brands commanding the remaining 20% with less than 1% share each and another 30 brands waiting in the wings trying to gain entry; then there’s you. So, I ask again, “what gives you the right to enter the US market?”
Sometimes my words are viewed as harsh, but I believe we have entered a time when everyone seems more concerned about hurt feelings than asking the tough questions. When millions of dollars are on the line in such business decisions, tough questions must be asked as it could mean the difference between a multimillion-dollar mistake or success.
In today’s market, me too products no longer have a place, and companies and industry leaders must work harder to find their reason for existing.
Is it a brand with history or heritage that commands 65% to 70% unaided consumer awareness? Is it a technology vetted through extensive consumer insights that genuinely solves a lingering problem? Maybe it’s not specific to the product you offer; it’s perhaps a problem resolution through your company’s structure that allows you to resolve global supply chain problems or meet extensive consumer needs through state-of-the-art dropship capabilities that sets an unprecedented industry standard in eCommerce.
No matter what makes you unique, different leadership thinking and innovation are the names of the game, and companies must strive to be the fastest, most agile, and most cost-effective.
Consumers must be brought along on the product development journey with relentless rounds of insight testing for every phase of the product and every feature and benefit. Ensuring every aspect of the complete story adds value. If it doesn’t add value, it must be removed through reverse engineering, dialing in the cost value plan down to the penny. Product Innovation must be relentless, especially when business is challenging. I’ve never understood why most companies’ first reaction when business gets tough is to slow down or even cut investment in innovation, but that is currently happening across the industry.
I view this as a failure to invest in the future while worrying about today’s stock price first. This is where the real opportunity presents itself to put competitors on their heels or, even better, in the rearview mirror.
Our industry usually benefits from economic downturns as consumers refocus on the home. These are the times when merchants mostly look for newness and innovation. When things are going well, and business is good, what is the motivation to change? I believe the pandemic covered a lot of industry bad business sins and has exacerbated the situation leaving even more companies unprepared than usual for a business cycle downturn.
Historically, I’ve seen as much as 45% of aggressive companies’ annual revenue driven by newness and innovation during challenging times. Make no mistake; 2023 is going to be an extremely difficult time.
You probably sense a mix of passion, concern, and urgency in my words. All feelings I have for our industry. This industry is not just a job opportunity; it’s a lifestyle I’ve loved over a 30-year career.
What is your plan for the next 12 to 24 months as an industry company or leader? Are you so wrapped up in excess inventory and eroding margins that you have taken your eye off the future?
You’re probably thinking, what does this guy know? He doesn’t understand our situation. A natural reaction to simply write off a differing view. As previously mentioned, a way to write off a challenge to the status quo with a new way of thinking.
Over the last 30 years, I’ve worked with and built some of the biggest brands in the industry, I’ve faced margin and inventory challenges, and I’ve had to make the hard decisions to downsize workforces affecting livelihoods and careers. I’ve answered to Corporate Boards and Wall Street when things weren’t going as planned.
The question now is, what will you or your organization do differently in these challenging times?
If you are looking for a senior leadership executive or a business consultant to challenge the status quo, let’s talk and discuss what we might learn together.
I wish you all much success and prosperity in finishing 2022 and beginning anew in 2023.