Observations in a Year of Recession from Continuum on Vimeo.

I found this collection of illustrated factoids pinned to a piece of foam core in the back corner of our studio the other day. I was drawn to their simple and effective communication style, as well as the diversity of the observations. Upon tracking down the illustrator (Rose Manning), I asked if I could use them. I wasn’t quite sure what for, but in the end, I took them and set them to a bit of music. Titled “Observations in a Year of Recession”, the three minute video seems to capture aspects of what the last year has felt like for many of us. Beyond the headlines of government bailouts, Wall Street failures, and falling home prices, the factoids focus on how this transition has affected the people who make up our economy, not just the businesses. I shared the video with a few friends and a simple question kept coming back – Is there a bigger picture to be drawn from these observations?
I suspect there are many implications one could read into this collection of tidbits. Here are two of mine:

1) TIME FOR DISRUPTIVE INNOVATION
I believe people will be more receptive than ever to disruptive innovations. In a recession, we are more actively making value-based purchase decisions. We are more conscious than ever about how we spend our money. This is not simply about finding the lowest price; people are seeking out the strongest value proposition. We are re-prioritizing purchase decisions based on what’s most valuable, rationally and emotionally. In today’s economy, people are willing to trade off some level of quality for a better value. This is one of the classic market dynamics in which disruptive innovations can flourish. The market is primed for new, better-value solutions.

Now is the time to explore opportunities to recalibrate a category, or create a new one, through the introduction of disruptive innovations. By offering a better-value product or service, in a way that the market does not expect, new market leaders can be established. On example that comes to mind is the netbook. I don’t think there could be a better time for a full court press of netbooks into the mainstream. Consumers will be more receptive than ever to a lower cost option, even if that cost comes with a decrease in performance.

2) MANAGE YOUR VALUE PROPOSITION
As people seek out the strongest value proposition – the brands that have diligently focused on value are being rewarded. McDonald’s, who has had a relentless focus on value, is being rewarded with strong growth during this economic downturn. Similarly, WalMart has benefited, as its value proposition is more in tune with today’s economy. And I don’t think this is just about low prices; each of these brands has worked diligently to improve their offering. As a result, I fully suspect at least some portion of the added market share they pick up today will likely stay with them as our economy rebounds.

In today’s market, the focus has to be on optimizing your value proposition. More than simply reducing your price, every brand needs to find the right combination of price and quality. And if you’re going to demand a price premium in the market, much as Apple does, you must be sure your offer is appreciably differentiated in a manner consumers can relate to and in a way that they value. This seems obvious, but as we see the onslaught of store brands winning market share from traditional brand leaders, it is a stark reminder of how an open market works.

I hope to hear about insights and implications others can tease out of these observations, or from your own experience through the last year.

2 of a 5 part series

Option 1

There are many options to monitoring power use.  One such way is to attach inductive coils around the main power lines to monitor Voltage and Current.  There are lots of products on the market that can be used in a residential setting.  These products require direct access to the mains power lines, but our commercial electrical closet has a main circuit breaker indicating 4000 Amps.  There is no way we were going anywhere near that!  Since we did not want to professionally install any expensive equipment for this initial experimentation stage we opted not to go this route.

from Elster Alpha Plus manual

Option 2

The Elster utility meter has an ANSI C12 Infrared data port on the front (marked by B in the above image) offering the ability to read power measurements from the meter.  The hardware protocol is a simple RS232 like-Infrared serial protocol.  We initially considered using this data port to read data from the meter but upon talking to NStar about it they told us we were not permitted to attach anything to the meter itself as this would be a violation of the meter lease agreement.

Option 3

The Elster meter has a numerical LCD display of the total watt/hours accumulated by the meter over a finite period of time.  We considered implementing an Optical Character Recognition system that would read the values on the LCD with a webcam and convert that to power use.  Unfortunately the values seemed to only update on a daily basis.  We wanted at least up to the minute resolution so this method was out of the question.

Option 4

After some research on the Elster A3 Alpha utility meter I found that there is a blinking box on the LCD display that has a frequency proportional to the instantaneous power use (marked by A in the above image).  Every time the box changes state, this indicates .9kWh (kilo Watt hours) have been used.  Finally a feature we can work with!  We will watch the blinking box with a web cam on an embedded Linux device and determine the energy use by monitoring the blink rate.

Tune in next week where I discuss the electronics and software design.

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Walk through your friendly neighborhood Target and you’re sure to experience a veritable street fight in the aisle between brands on top of their game. Cool brands, hip brands, brands for moms, brands with a heart, big brands, brands that are good for the earth, brands you’ve grown up with – all battling it out for your attention and your dollars.

And one of the best brands you’ll encounter at Target is, in fact, Target.

It’s never labeled as such, obviously, because Target has realized that it can gain more strategic value by creating house brands targeted (forgive the pun) towards specific shopping categories, not the entire store. Rather than populate every aisle with same looking generic packages featuring the store brand, Target has cultivated a rich assortment of brands that go straight after what users need, want and desire. Step into the candy aisle and you’ll discover a colorful candy brand named Choxie (by Target). Walk down the auto aisle and you’ll see twenty feet of brushes, sponges, hose attachments and polishing cloths under the Vroom brand name (guess who?). Target has changed the game on their house brands, because they don’t feel like house brands anymore – they’ve become good products people just want. And the important point is that structuring house brands this way helps differentiate Target from its retail competitors. Unique products create unique aisle experiences, and unique aisles means Target doesn’t feel like Wal-Mart and the rest.

Which brings me to their latest creation, Up & Up.

Target developed Up & Up as the new brand name for household consumables like paper towels, diapers and disposable dishware.  Gone is the Target bullseye and clean, generic brand package. In its place is a new brand with a more modern look and feel. The reasons for change make sense to me…

What I don’t get is why Target abandoned the street fighter mentality that has worked so successfully for them in other parts of the store – taking on the big guys aisle by aisle. For some reason they didn’t create new, distinct brands around baby, food storage, cleaning, beauty, and the rest. They just made one big brand to try and cover an entire corner of the store. But the rub is that these are unique categories, with unique dynamics and unique shopper needs.

Too unique for just one brand to satisfy?

Did Target miss a big one here?

I’m sure that folks like P&G, J&J and Method are sure hoping so.