Developing your Business Strategy for the Digital Age with Scott Galloway, Key Takeaways
3 weeks ago
“Retailers must be excellent in digital or they will go out of business” noted Scott Galloway, NYU Professor of Marketing. In light of the recent COVID-19 Pandemic, businesses must transform their strategies to the digital world if they wish to survive and thrive in an eCommerce dominated age.
1: The 4 Horsemen
“The 4 Horsemen’’ coined by Scott Galloway are businesses worth over a trillion dollars. The big four include Facebook, Apple, Amazon, and Google. These companies are involved in almost everyone’s day-to-day lives dominating not only our online experience but also the corporate world. But, what makes these companies so successful is their ability to identify and satisfy human needs.
2: Appealing to Human Instinct
Google has become the replacement for a higher power. In this modern age Google becomes the first place a person turns to when a question is left unanswered. Apple adds to a person’s sex appeal. When someone has an Apple product they are perceived as wealthier, fashionable, and increasing sex appeal. Amazon has become a ‘temple of consumption’ as it provides us with a seemingly endless assortment of products. With over 1.2 billion daily visits to their site, Facebook has managed to gather nearly one-sixth of the world’s population in their digital space on a daily basis. By appealing to our daily human needs, these four companies have grown to dominate the business world and play an essential role in our daily lives.
3: Benjamin Button Effect
The ‘Benjamin Button Effect’ represents an algorithm or product which appreciates in value with every usage from its customer. The ‘Recommendation’ tab on Netflix systematically changes and improves each time a user watches a new tv show or movie. As the individual increases the number of movies and tv shows watched more data is added to the system creating a more personalized selection for the customer. Providing both an assortment of entertainment and an algorithm catered to every individual user, Netflix has become globally renowned as the preferred hub for movies and tv shows. Amazon utilizes a similar effect with a “Similar Products’ function. Its algorithm recognizes what each user has recently or frequently purchased in the past and offers similar products in hopes of increasing sales. Companies which utilize the ‘Benjamin Button Effect’ gather more insight on the customer and are more aware of sudden changes in consumer behaviour.
The T-Algorithm, developed by Scott Galloway’s L2 Market Analysis Company, was used to identify startups which would join an elite group of companies worth more than one trillion dollars. This algorithm was identified by analyzing the characteristics of four companies: Amazon, Google, Facebook, and Apple. These companies are characterized by the same 8 variables: Product Differentiation, Visionary Capital, Global Reach, Likeability, Vertical Integration, Artificial Intelligence, Career Accelerant, and Geography.
5: How do the ‘Horsemen’ reflect these variables?
Each of the four have the ability to deliver superior products. Apple has their appraised iPhone, Amazon has a myriad of products in their assortment, Facebook brings one-sixth of the world together in their digital space, and Google can answer virtually any question thought of by the human mind. With Visionary Capital, each of the four have a long term goal in mind. Facebook wishes to connect the world in their digital space while Google seeks to organize all data on their platform. The four Horsemen have extended their reach on a global scale as people from all over the world either use or are familiar with these companies. To avoid intervention, a company would need to develop a sense of likeability if it wishes to be accepted in society. Each of the big four hold vertical integration as they control each step of the production and distribution of their products. To create an efficient algorithm to gather and store countless data, powerful artificial intelligence must be used. Strong artificial intelligence and digital presence is a pinpoint for brands wishing to establish their name in the business world. An amazing business requires an amazing team. For a business to join the big four it must be seen as an accelerant for one’s career if it wishes to attract talented individuals on their team. The final variable in geography. Each of the big 4 are established around top tier universities which allows the recruitment of the brightest minds.
“The Digital Age is Heraclitus on steroids: change is a daily constant,” added by Scott Galloway, NYU Professor of Marketing. By cutting costs, establishing a recurring relationship with customers, and communicating risks and visions, companies can greatly increase their survivability in these disruptive and uncertain times. Businesses seeking to improve in their digital presence should follow the eight variables found in all four trillion dollar companies if they wish to remain agile and develop a long-term, sustainable business strategy.
If you were unable to attend our webinar we invite you to view the full recording here: https://us.vtex.com/scottgalloway
About BORN and VTEX:
Selling through digital channels has been accelerated a decade forward in a short span of three months thanks to COVID-19; and it has happened across every industry. As a global leader in collaborative commerce solutions, VTEX is ready to help you succeed with your commerce strategy, be it B2B, direct-to-consumer or launching your own marketplace. Working together with BORN Group, an award-winning full-service digital commerce agency, we help organizations deliver collaborative commerce experiences to meet today’s “new” buyer demands.
For more information, please reach out to Mackenzie Johnson, firstname.lastname@example.org.