At the beginning of June, Kleiner-Perkins partner Mary Meeker released the 2016 version of her now-essential Internet Trends Report. The venture capitalist tech guru tracks the ebb and flow of Internet, phone and media use, and she uses the stats to point out emerging trends that influence everything from the tech sector to the way that worldwide consumers live, shop and interact with their economy. Although many will geek out over the sheer volume of stats, others will use the numbers to validate their own views…sometimes using the same figures to prove opposite points.
For example, one of the first items out of the gate was that global adoption of the Internet is flat, year-over-year, growing at nine percent. More than three billion people—about 42 percent of the world’s population—are now online. That means we’re just about at the point of a classic “glass half-empty or glass half-full?” debate. So, it’s important to see some context: Most of the remaining 58 percent are in developing nations, and India leads the growth. At this rate, it will be about a decade before we’re even close to “Internet for all,” and that assumes nothing happens in the next decade to replace or negate the trend.
However, those of us who sell domestically should be aware that America’s online user access is near saturation right now, which means that growth will come from successful marketing rather than from a “rising tide lifts all boats” model. Exponential growth is a thing of the past. That means (despite pitches from purveyors of turnkey shopping carts) that just being online—even with SEO tools that are effective—only gets you a shingle on the Web. You still must be efficient, fast, attractive, price-competitive and service-oriented, once someone finds your store. A few seconds of shopping a ho-hum online store and the customer is back on Amazon.
So, here are a few of Meeker’s points, along with why and how I think they might influence our industry. Want to draw your own conclusions? I think you should. Google “Mary Meeker” and you’ll get the full presentation for your edification.
Point: Smartphone adoption is slowing, and Android is gaining market share (now 81 percent of users globally).
Although that isn’t a fact that will send our industry spinning, it does illustrate how careful we have to be about marketing. I know people who firmly believe the split is around 50/50, and who feel that, if Android has an edge, it’s because so many grandparents use it. They base this opinion on the fact that all their friends have iPhones. Meeker’s numbers are right, though, and the figures show Apple is losing share in the U.S., not just worldwide. If you want to market to the broad population, you have to include Android. If your product or service only appeals to young, tech-savvy millennials, perhaps you can get away with iOS only…but you had better be sure.
Point: Video on social media is exploding, with Facebook Live and Snapchat leading.
Point: Mobile ads are growing dramatically, with Facebook (+59 percent) and Google (+18 percent) the most aggressive.
It’s easy to host a live feed from your store, recital or remote event. It’s a great way to engage your audience, define your brand and increase loyalty. Meeker also tells us that many advertisers continue to overuse traditional media, and there are still advantages for those who focus on mobile ahead of those late adopters. But selling, whether via video or in ads that are more common, is much harder than simply being present. Despite the immense data troves that Facebook and Google can use to target your audience, the fact remains that people don’t like obvious commercials. Indeed, Meeker also reports that ad blocking is up 94 percent, and she warns that ads done wrong can cause people to hate your brand. This isn’t a matter of jumping on the proverbial bandwagon or, worse, waiting to jump. Any entry must be on point, or it will be ineffective, and perhaps even damaging.
Point: Millennials have unique values: a greater focus on work/life balance, a drive to self-development and an increase in community involvement.
I have millennial friends who resent the implication that they are lazy just because they also value their leisure/recreation time. I’ve also seen how passionate they can be about social issues, and how often they seem to consider themselves a “work in progress.” Although every generation of 20-somethings takes their share of flak from the previous generations, I really think they’re on the right track. Moreover, I think their values will be good for our industry.
Work/life balance presents an opportunity to get (or keep) this generation playing. They like it. They will make time for it. And it plays directly into their push for self-development. We need to tailor programs for them, thinking of ways to play together. Tap into their community affinity with performances for seniors, by bringing music to kids in need or by planning public performance events. If millennials perceive your store as the source for such activities, your brand cachet will be ever increasing.
There are dozens of other information nuggets that Meeker shares. More important than the raw statistics and graphs presented, though, are the insights about where markets and consumers are heading. You might find your opinions confirmed or your assumptions shaken, but, if you are paying attention, you won’t be blindsided.
Within the music products industry, we are navigating our way through changes that are more than simple “fashion trends.” Although we might not experience the disruption some sectors face, we are already dealing with profound shifts in consumer shopping behavior and time utilization. If we don’t aggressively search for emerging patterns and trends, we might miss the best opportunities and, thereby, risk manifesting the definition of insanity apocryphally attributed to Einstein: doing the same thing over and over, while expecting different results.
In my opinion, retail can and will survive, and music retail has a better chance than many. But the survivors will be those businesses that transform themselves into compelling shopping experiences, community hubs for music making, or destinations for service and expertise. The best will become all three.