Disruptive Innovation

February 8, 2012

Disruptive InnovationSocrates taught us to question everything. And when it comes to innovation, nothing could be closer to the truth. But Luke Williams, professor of Innovation & Design at NYU Stern School of Business and author of DISRUPT, takes this notion a step further—”disruptive innovation.”

Speaking at Columbia Business School’s BRITE ’11 conference, Williams explained that companies today tend to have a myopic vision when using new technologies to build their brands. Digital magazines, for example, may offer more features, but they’re still giving consumers what they expect in ways that they expect. “As a result, a lot of our brand-building around these new technologies has taken on some pretty predictable trajectories.”

Disruptive innovation, however, is not about technological change. According to Williams, it’s about a revolution in behavior and “changing the way you think about a category.” Brands need to move beyond focusing on what the latest technology can do for their company or product. Williams challenged the audience to break free from conventional assumptions about a category to see from a new perspective. To do so, he reminds us to be careful of cultural influence and to pay attention to context, not just the foreground. As consumers and the marketplace evolve, it is increasingly important to embrace disruptive innovation before it is forcibly imposed by a new competitor or shifting consumer landscape.

To quote Harvard Law School professor, Roberto Unger, “the task of the imagination is to do the work of crisis without crisis.”

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To gTLD or to Not gTLD

February 8, 2012

If you haven’t already heard, there’s a new word in town. It’s called “dotBrand” and it’s about to crack the dotcom world wide open.

In January 2012, the Internet Corporation for Assigned Names and Numbers (ICANN), the non-profit organization that governs the internet’s naming system, is opening the opportunity for global businesses, communities, governments, and even geographical locations, to apply for generic top-level domain names (gTLDs)—such as .canon, .wine, and .nyc. Many are now weighing the pros and cons of “dotBranding” themselves.

To gTLD or to Not gTLDThe news surrounding ICANN’s new gTLD program, has stimulated a broad discussion raising questions such as “How could my business benefit from this?” to “Do I need to protect my brand?” Like all things, there are a wide range of considerations to factor in when deciding whether to apply, among them trademark protection, brand equity, and cost.

It should be clarified that ICANN isn’t simply handing out gTLDs to the first person or organization that applies. Just because Jane in Arizona is applying for .madonna doesn’t mean that she’ll get it. There are “checks and balances” in place including a trademark clearinghouse providing authentication of trademark information, and an objection-based process enabling rights holders to demonstrate that a proposed gTLD would infringe their legal rights. Of course there are valid concerns for businesses, organizations, and communities who do have common or even similar names. A company like Patagonia may be legitimately concerned about securing the same domain name as the region of Patagonia. ICANN has created a dispute resolution program, and even auction procedures, to handle such issues.

While some brands perceive gTLDs as a risk and may be considering applying for trademark protection, others envision possibilities involving brand extension and brand architecture. For example, a parent company like Unilever with multiple sub-brands could employ “dove.unilever.” B2C businesses like Citibank could create a more personalized consumer experience through their websites with url’s such as “www.michael.citibank.” But this also begs the question about the appearance of a brand’s homepage—is it “home.bmw” or “bmw.bmw”? Brand consultants seem to still be hashing this out.

And many opponents to the new gTLD program feel the financial commitment is a hefty price to pay for a top-level domain system that they feel works fine with its 22 existing TLDs (.com, .gov, .jobs, etc.). The application costs US$185,000 as well as a reported US$25,000 annual fee. Then there are the additional expenses such as technical, administration, and maintenance fees. For big name brands, this could be worth the investment. When compared to the cost of a single, 30-second television spot, it’s not a huge chunk of change. For small to mid-size companies, however, it is an expensive endeavor that may take deeper consideration.

“The kinds of benefits we see from a brand-building perspective are things like controlling your brand and your content,” explained Karl Isaac, Executive Director of Landor’s digital branding practice, during the Center’s webinar. “If you are a business that transacts with your customers or that protects very private and confidential information for your customer, the increased security benefits alone may outweigh the risks of doing this.”

The application process may be preempted, however, as the U.S. Senate Committee on Commerce, Science, and Transportation has called for a hearing this month to discuss the merits, implications and concerns surrounding ICANN’s new program. If the gTLD application process does move forward as planned, businesses and organizations will need to do due diligence if thinking about applying.