The thing is, in our experience of working on launches, we have seen that one launch often leads to another. When a brand is a pioneer within a sector it causes existing brands to reevaluate the market as a whole and their position within it.
As a result, after a pioneer brand launches you tend to see follower brands offering a similar product with a key differentiation and/or existing brands launching brand extensions.
So disruptors shake up the market and create opportunities so that both they and other brands can take advantage. Entrepreneurs either about to launch or already ensconced in their markets should take careful note.
Airbnb, for example, has certainly disrupted the hotel and hospitality sector and in doing so has, in the long term, done the industry a favour.
The rise of the sharing economy, especially amongst millennials, has forced hotels to look at how they service this demographic and some exciting new products are launching from the hotel industry:
” Marriott introduced Moxy Hotels and AC Hotels specifically for millennials
” Best Western unveiled Vib, a chic urban boutique hotel
” Hyatt debuted Hyatt Centric last year, a moderately priced lifestyle hotel
” Hilton will open its first Canopy hotel this year in Iceland, with dcor and food and beverage offerings inspired by the local community
” Hilton also announced Tru by Hilton, a budget brand targeted at millennials.
When there is a dominant business model within a sector (such as large hotel chains), new product development can be neglected theres no imperative to change things up when the money keeps rolling in.
But Airbnbs disruption has now forced them to create a product portfolio that is future-proofed for the increasingly affluent millennial generation.
But it’s not just the taxi and hotel sectors. According to the Futures Company, one of the key factors making industries ripe for disruption is who benefits most from the current business model
Prior to Uber, it says, taxi consumers were losing out in both price and convenience. Similarly, people bemoaned the value of some of the larger hotel chains before Airbnb appeared, both for room pricing and charging extra for services like WiFi.
So the business models of these new arrivals are inherently customer-centric. They recognise the need for a seamless experience, greater choice and flexibility and, most importantly, value for money.
Uber has solved the issues of safety and cash payment with a user review system and automated payments. Meanwhile Airbnb offers a home from home with all the facilities youd expect: free WiFi, a fridge, parking space, laundry and ironing facilities and so on.
What this all tells us is that businesses need to take a long hard look at their sector to see if it’s ripe for that level of disruption. Are the products or services truly customer-centric Are they addressing the needs of modern consumers Are there new technologies or changing socio-economic dynamics that can affect who buys what and why
And if that is the case, of course it’s great if you have the idea for the next Uber but it’s not a disaster if you’re already in the sector.
Existing brands can piggyback on a disruptive arrival with new launches to keep themselves fresh and relevant. Either way, act quickly enough and you can ensure you ride the wave rather than be washed away.
Jo White, MD UK at launch marketing agency Five by Five