Innovation, alongside disruption are two of the most overused words in business at the moment. Like obscenity, many people have their own idea of what innovation is.
Judy Estrin wrote one of the best books about the subject and describes it in terms of hard and soft innovation.
Hard innovation is companies like Intel or Qualcomm at the cutting edge of computer science, materials science and physics
Soft innovation would be companies like Facebook or Yahoo!. Companies that might create new software but didn’t really add to the corpus of innovation
Silicon Valley has moved from hard to soft innovation as it moved away from actually making things. Santa Clara country no longer deserves its Silicon Valley appellation any more than it deserved the previous ‘garden of delights’ as the apricot orchards turned into factories, office campus buildings and suburbs. It’s probably no coincidence that that expertise has moved east to Taiwan due to globalisation.
It can also be more process orientated shaking up an industry. Years ago I worked at an agency at the time of writing is now called WE Worldwide. At the time the client base was predominantly in business technology, consumer technology and pharmaceutical clients.
The company was looking to build a dedicated presence in consumer marketing. One of the business executives brings along a new business opportunity. The company made fancy crisps (chips in the American parlance). They did so using a virtual model. Having private label manufacturers make to the snacks to their recipe and specification. This went down badly with one of the agency’s founders saying ‘I don’t see what’s innovative about that’. She’d worked exclusively in the IT space and thought any software widget was an innovation. She couldn’t appreciate how this start-ups approach challenged the likes of P&G or Kraft Foods.
Innovation signalling has some similarities with its counterpart virtue signalling in terms of authenticity in terms of behaviour and the projected image. An organisation looks to demonstrate its ‘high degree’ of innovation with actions and projects with the external image firmly in mind. There may be an internal learning, or business benefit to this as well, but the image projected is the main objective.
As I wrote this post a collaboration between Moncler and Adidas dropped putting innovation signalling at its core involving both involving NFTs and AI generated designs and models.
Open Sea has an NFT where the owner gets a Rolex watch on submission of the NFT. This has since been extended into the US market by CRM Jewellers in Miami.
AI has its place for instance, simulating and optimising product design based on physical properties. NASA has used AI for just this purpose in conjunction with additive manufacturing techniques for small production runs of parts needed for the space programme.
It’s not just the luxury sector
This might read like I have been picking excessively on the luxury sector. I use them as exemplars mainly because their examples are so high profile. But there are examples in other sectors. For instance, Walmart partnering with IBM to use block chain to track individual lettuce heads from farm to customer trolley.
There were similar partnerships that IBM hatched with Unilever, Nestlé and Dole Foods as well, but the fruits of these projects were not publicised to the same degree.
You can find similar posts here and this metaverse discussion paper that helps to cut through the blockchain and metaverse hype.
An Outfit to Match Your Chain – Google Drive – Highsnobriety has interviews where these intersect with luxury and fashion. It will be probably handy for a couple of client presentations
Technonationalism as a term has started to spring up in Chinese policy discussions regarding technology trade with the US and China.
Technonationalism origins
Technonationalism is a term used by economist Robert Reich in 1987 to describe the relationship between technology and national security. Reich used the term in an article that he wrote for The Atlantic. It originally referred to the intervention of the Reagan administration in the United States to prevent the acquisition of Fairchild Semiconductor by Japan’s Fujitsu. Reich felt that the Reagan administration mis-understood the the technology problems faced by the US and blocking the Fujitsu-Fairchild deal was the wrong thing to do.
Elkor Labs photo of Fairchild Semiconductor exhibition stand.
The China effect
In English language usage, it started to be mentioned in publications as far back as 1969 and seems to have had two distinct peaks. The first was from the Brezhnev-era Soviet Union through to 1990. The second peak coincides with China’s rise.
From a Chinese perspective, strategic conflicts between major powers have revitalised the concept in the international political arena. Of course, this ignores China’s own actions and their perceptions by other countries:
Chinese government policies to promote economic independence and induce strategic dependence of other states across all infrastructure technologies – or as the FT calls it ‘Fortress China‘
Today, the competition between China and western democracies is focused on critical materials like pharmaceuticals and a range of strategically important advanced technologies.
These sectors include:
Electric vehicles (or as they are called in China new energy vehicles)
Drones, virtual reality,
Various type of machine learning ‘artificial intelligence’
Big data and data mining
Robotics and automation
5G networks
The Internet of Things (IoT),
Synthetic biology
This conflict is considered more severe than the US – Japanese semiconductor trade friction of the 1980s. But Japan and the US were largely aligned from a political, defence and economic perspectives during this time.
The technology related to disputed sectors are seen as key to the next generation of defense systems, industrial capabilities and information power China and western democracies.
Neo-liberalism & technonationalism
This implies that economics is an extension of defence rather than completely separate, as implied by the western neo-liberal laissez-faire approach to globalisation. This places company leadership dead set against the wider interest of their own western countries. During the cold war with the Soviet bloc western companies were much better aligned with their country’s interests.
Palmer Luckey’s Anduril represents a notable exception in Silicon Valley and its attitude is remarkably different to the likes of Apple or Microsoft.
Post-war Asian miracle model
While technonationalism as a term was given voice in the mid-1980s, one could consider the directed economy efforts by the likes of MITI in Japan and its counterparts in Taiwan and South Korea as being technonationalist in nature.
From this perspective, technonationalism played a crucial role in post-World War II economic and industrial policies, fostering domestic industries, promoting scientific and technological innovation. These polices propelled Japan to become a global technological power. Korea took a similar tack with Park Chung Hee’s compact with the chaebols and the Taiwan government was crucial in the roots of Taiwan’s dominance in semiconductors.
Back to the present
The current increase in technonationalism by China and western democracies means that international trade in many fields will continue to change due to national security concerns evolve. This is often masked in language such as de-risking, de-coupling and de-globalisation.
The racket sport padel seems to have got the zeitgeist, if not the player numbers yet. We haven’t really seen a surge in sports fads since the 1980s. During that time skateboarding rose from a peak in the late 1970s, to a more stable underground sport that we have today. The closure of a squash racquet factory in Cambridge, saw the sport globalise manufacture and playing. In a few short years rackets went from gut strings and ash wood frames to synthetic strings and carbon fibre composite rackets. It was as much a symbol of the striving business man as the Filofax or the golf bag. Interest was attracted by a large amount of courts and racket technology that greatly improved the game.
Squash had its origins in the late 19th century and took the best part of a century to reach its acme in the cultural zeitgeist. Skateboarding started in the late 1940s and took a mere 30 years to breakout. Padel falls somewhere between the two. Padel was invented in 1969. But it took COVID-19 to drive its popularity in Europe and North America.
There is a new world professional competition circuit for 2024. And it has attracted the interest of court developers looking to cater to what they believe is latent consumer demand.
Finally, you can get three padel courts in the space for one tennis court. More on the padel gold rush from the FT.
The challenge is if padel is just a fad, or has it longevity? Skateboarding is popular, but many councils didn’t see the benefit of supporting skate parks built in the 1970s around the country. Squash still has its fans but doesn’t have the same popularity that it enjoyed in the 1980s.
What’s it like being a Disney adult? – The Face – this is much more common in Hong Kong, but then people had annual passes to go there. I found it interesting that The Face othered it as a sub-culture
Vittles Reviews: There Is Always Another Province – Province-chasing isn’t just a Western phenomenon; China is still so vast that when the barbecued food of Xinjiang, one of China’s border provinces, showed up in a former sausage shop on Walworth Road at Lao Dao, it didn’t need to open to the general public for months, choosing only to take bookings via Chinese social media. The paradox is that the success of regional Chinese restaurants has created a Western audience which wants more, but that same success has allowed these restaurants to bypass those customers altogether
Culture
Television: one of the most audacious pranks in history was hidden in a hit TV show for years. – Watch enough episodes of Melrose Place and you’ll notice other very odd props and set design all over the show. A pool float in the shape of a sperm about to fertilize an egg. A golf trophy that appears to have testicles. Furniture designed to look like an endangered spotted owl. It turns out all of these objects, and more than 100 others, were designed by an artist collective called the GALA Committee. For three years, as the denizens of the Melrose Place apartment complex loved, lost, and betrayed one another, the GALA Committee smuggled subversive leftist art onto the set, experimenting with the relationship between art, artist, and spectator. The collective hid its work in plain sight and operated in secrecy. Outside of a select few insiders, no one—including Aaron Spelling, Melrose’s legendary executive producer—knew what it was doing. The project was called In the Name of the Place. It ended in 1997. Or, perhaps, since the episodes are streamable, it never ended
Rode acquire Mackie | Sound On Sound – this is big for podcasters, but also for artists that record in their own studios. Mackie mixers have powered the home grown set-ups of artists like The Prodigy, The Crystal Method, Brian Eno, Daft Punk and Orbital.
Health
China e-cigarette titan behind ‘Elf Bar’ floods the US with illegal vapes | Reuters – In the United States, the firm simply ignored regulations on new products and capitalized on poor enforcement. It has flooded the U.S. market with flavored vapes that have been among the best-selling U.S. brands, including Elf Bar, EBDesign and Lost Mary. In the United Kingdom, by contrast, Zhang has complied with regulations requiring lower nicotine levels and government registration while building an unmatched distribution network — and driving a surge in youth vaping
Hong Kong’s first ‘patriots-only’ district council poll reflects political tale of two cities, as some eagerly rush to vote and others shy away | South China Morning Post – Hong Kong on election day splits into two camps, with one eager to vote out of civic duty and others giving polling stations wide berth over lack of political diversity. ‘I thought more people would come and vote because there has been more publicity,’ one elector says after discovering sleepy atmosphere at local polling station – the question is will Beijing take anything from this voter turn out? Does it signal suppressed but indignant separatists, or Hong Kongers who are more focused on prosperity and weekend Netflix? If they suspect the former then the security situation is likely to get more dire
Inside Louis Vuitton’s Hong Kong spectacle | Vogue Business – While Hong Kong is gradually recovering from the pandemic lockdowns, growth in Mainland China is slowing. According to HSBC estimates, luxury sales there are expected to grow 5 per cent in 2024, a sharp deceleration compared with 2023’s projected 18 per cent.
Breakin was a 1984 film which brought hip hop culture around the world. You can criticise the plot and awkward dialogue, but the break dancing and body popping was amazing. The film was a sufficiently successful commercial success that a sequel was made to the original film.
The broom sweeping scene
The broom sweeping scene in Breakin was inspirational drawing from mime, body popping and breaking sparked the imagination of people around the world. It made the dancer Michael “Turbo” Boogaloo Shrimp Chambers a global celebrity. Chambers himself credited stop motion animation of films like Ray Harryhausen’s works as being a key influence. He went on to teach Michael Jackson the ‘moonwalk’.
The broom sweeping scene from Breakin was shot at 4323 Melrose Avenue, which in turn has turned into a pilgrimage for fans. So a camera crew and Chambers went back to the site and reshot the scene over one night. The production team had wrapped the building to resemble the original in 1984.
Despite Chambers recovering from knee surgery, he still has the skills some 34 years later.
Caterham Project V
Caterham are famous in the car world for their evolution of Colin Chapman’s Lotus 7 design, which was the purest manifestation of Chapman’s design philosophy to make light, great handling cars. Caterham has been looking at making the jump from internal combustion engine powered vehicles to electric power. Like previous Caterham cars, much of the design process is about curating parts from other manufacturers parts bins with their own chassis and suspension design to come up with a perfect handling chimera.
‘Military Magic’
The role of innovation and military development has on each other is a subject that is often discussed. Our modern online world is down to cold war thinking about resilient data and telecommunications network. But Kuo’s research has found that innovation can also hurt combat effectiveness and highlights the kind of factors where this might occur. Innovation isn’t bad, but can be done badly. More on related content here.
Green Mountain Coffee Roasters
In the US, Keurig k-cup capsules are the default home brewed coffee standard, rather like Nespresso in Europe and much of Asia. Green Mountain Coffee Roasters worked with Kevin Costner to create signature roast varieties for him. The subsequent ad lampoons how brand partnerships often move from the authentic to the ridiculous.
7-Select
7-Eleven Hong Kong is a standby for workers wanting a grab-and-go breakfast, lunch or dinner at their desk. They have a range of foods called 7-Select. They promoted it online and via TV advertising this year using local celebrity Dee Gor and generative AI-based artwork.
The 7-Select range features many Hong Kong stables that merge western dishes like sandwiches in a local way that is emblematic of Hong Kong cuisine. Below is a video on the making of the advertisements including green screens and wire work – usually a staple of Hong Kong’s fantastical martial arts film industry.
For some brands sponsorships aid in research and product development, motorsport and mountaineering are two sports where this the case. Other sponsorship deals, for instance college athletes and premier league footballers depend on the individuals effect as an influencer as much as their role on pitch. All of these complexities will affect the perception of the sponsorship value and effectiveness. Sponsorship being unmanaged and unmeasured isn’t a new phenomenon. – Sponsorship ‘unmanaged and unmeasured’, WFA warns – The Media Leader. Shirt sponsors are basically dependent on the amount of time on screen. Sponsoring celebrities like Jackie Chan is more about attracting eyeballs to the companies advertising campaigns.
(Jackie Chan represents a particular problem in this sector of sponsorship because he represented over 12 brands at the same time. From local companies that made game consoles suspiciously similar to Nintendo systems to Japanese multi-nationals Canon and Mitsubishi.)
Part of this focus on sponsorship measurement might be about the culture change digital advertising created: How the digital revolution led to a greater justification for advertising – The Media Leader. Famously, telecoms executives love of particular sports influenced sponsorship programmes of their companies. Sir Peter Bonfield was a keen sailor and BT sponsored the Global Challenge yacht race series.
Sir Chris Gent, over at Vodafone was a big cricket fan. The sponsorship would have been difficult to measure as a lot of the impact would have been in cementing existing relationships and facilitating new ones through corporate entertainment. With both, there would be some efforts to demonstrate the relevance of the sponsorship, but it was very much putting the cart before the horse.
Grateful Dead x Stundenglass Bong | Esquire – yes the Grateful Dead now have an official bong for resale, but the author’s deadhead memories are the thing to read on this article
Louis Vuitton is selling a €6,000 digital mini trunk by Nicolas Ghesquière | Vogue Business – Louis Vuitton is selling a €6,000 digital mini trunk by Nicolas Ghesquière. The next product available to LV’s exclusive group of NFT holders is a mini trunk bag designed by the brand’s women’s artistic director. Only 200 are available, and the physical will land in March.
