Is there any data showing that creating disruptive and different advertising is more effective for a brand than following the status quo?
Disruptive marketing is becoming a vital technique for companies in today's market in order to remain prevalent and move up in the market. Smaller business have used disruptive and innovative approaches to level themselves with larger brands, sometimes even putting the larger companies out of the market for good. By utilizing unique strategies to market to audiences, companies can grow their market shares and gain a larger audience. Below you will find an overview of the importance and relevance of disruptive marketing in today's world, as well as some examples of how companies have used disruptive marketing to excel.
Disruptive marketing from a Historical Perspective
WHAT IS DISRUPTIVE MARKETING?
According to Professor Clayton Christensen from Harvard Business School, disruptive marketing is a process in which a product/service starts from the bottom of a market and move up through the market by using new and innovative techniques, eventually passing by established competitors. Disruptive marketing is about taking risks and considering the future goals of a brand and how to achieve them. It requires a different method of thinking — making moves that other similar companies have not made; breaking traditional molds; creating and improving upon innovations.
WHY DISRUPTIVE MARKETING IS NECESSARY
Disruptive ideas and strategies are what keep the market moving forward and growing. If no company or individual ever came up with a new idea or approach, then markets would be at a standstill, and every company would be at the same place. Attempting to prevent disruptive marketing can deter individuals in a business from speaking up with new ideas, putting the business at a standstill. Disruptive marketing presents the opportunity for lower or less-established businesses to level the playing field with more known businesses by giving them an edge.
WHAT DISRUPTIVE MARKETING ACHEIVES
In history, new industries and companies were formed through disruptive marketing. The businesses that either presented something entirely new or built upon an existing situation or product are the ones that succeeded. Disruptive marketing is what makes growth and change possible. It helps to make products and services available to consumers that otherwise could not afford them, and helps businesses that are already established and succeeded to hold their place in an ever-changing market space.
Trends & Statistics of Disruptive Marketing
When it comes to employing disruptive marketing trends for a business, there are a few key things to keep in mind. "It's not enough to just disrupt an industry...you must continue to act as a disrupter in continuously challenging the terms of the buyer and seller relationship, and the platform through technology, on which they trade." Disruptive marketing techniques are growing more popular among smaller businesses today. It is important to be able to constantly adapt to the changing industries in order to remain prevalent. In today's businesses space, 80% of marketers believe that their number one marketing strategy is only slightly or somewhat effective. Only 61% of marketers believe that their overall marketing strategies are effective. Disruptive strategies can overcome this, by changing business models and expectations. Below are examples of some companies that have adopted disruptive marketing techniques, and how they have succeeded, as well as examples of companies that have failed due to their lack of disruptive marketing.
When Uber was first formed, the goal of the business was solely to allow users to request premium black cars in a select few metropolitan areas. However, the company has now grown to be the largest ride-hailing application in over 500 cities around the world. This was done by providing a service to users that was cheaper, easier, and more modern than traditional ride-hailing services. Disrupting the traditional methods of business and marketing results in a 30% reduction of taxi rides in just three years from when Uber started. Between 2014 and 2015, Uber went from having only 9% of the rideshare market to having 29% of it in 2015, and 71% of the market as of September 2017. The company's revenue in 2014 was only $2.9 million, and that number grew significantly to $10 billion in 2015 and $20 million by 2016. In 2013, Uber's valuation was market at $3.9 billion, but by the end of 2017, Uber was valued at $68 billion. Because Uber was able to alter and better an already existing market through disruptive techniques, the company has grown to be the most popular and widely-known rideshare country worldwide.
Since their start, Airbnb has helped to place more than 60 million guests in homes in more than 34,000 cities in 191 countries globally. Airbnb has capitalized on the growth of the peer-sharing economy by placing small and large businesses on the same playing field, posing a large threat to hotels. In 2015, the company's revenue was about $451.43 million, but by the end of 2018, the business is expected to reach approximately $805.32 million in revenue. By matching guests with a place to stay at lower rates than hotels, the company has grown significantly since their start. Between 2014 and 2015, travelers spent around $3.4 billion on Airbnb, compared with $141 billion on hotels. Although this is only a 1.7% rate compared with hotels, the number is continuing to grow. The average daily rate of a stay in Airbnb was only 18.8% less than that of a hotel in 2015.
Originally formed to be a competitor with Blockbuster Video, Netflix has evolved from a mail-order subscription movie service to a new take on the cable industry. By January 2014, Netflix caused the closure of all remaining Blockbuster stores. They have begun to produce original content that is only available on Netflix, and even has other similar businesses trying to copy their moves. Because of Netflix, 18% of the total U.S. population has never paid for traditional TV services, and an additional 6% quit their traditional TV services for Netflix instead. Since 2007, the company has grown from 7.48 million subscribers in the U.S. alone to 49.714 million subscribers in 2016. The company's revenue since 2012 has grown from $1.36 billion to $8.83 billion in 2016, and no other related businesses can even compare.
BLACKBERRY & IPHONE
When the first iPhone came out in 2007, it presented to the world new technology (touch screens) that had never been used before. At the time, Blackberry phones were the most popular, and believed that, in spite of the iPhone's new technology, their always-available full keyboard would keep them as a major competitor in the mobile phone industry. Blackberry was wrong, and they dropped by 50% in earnings by 2013. While Blackberry was originally an excelling company, their lack of ability to change and provide new content, or even just build upon what they already had, lost them everything.
At one point, Nokia held over 40% of the mobile device market. However, Nokia sold to Microsoft in 2013 for $7.17 billion, holding only 3% of the global smartphone market. The company did not fail because of their lack of ability to produce new technology, technology that matched the market — they had the technology and capability. Nokia failed because they did not have anything special about them as new technologies like Apple and Samsung rose in the industry. They failed because they did not continue to work hard and make sure their audience knew they had something significant to offer. Perhaps they thought they could get by because they were already at the top. But the company spent their time marketing too widely, and not producing something worthwhile.
Disruptive marketing has made it possible for smaller companies to make a mark in the ever-changing and technologically advanced market. In a space where all companies are now being forced to keep up with smaller businesses, it is important to both innovate and disrupt the market through new strategies. Embracing new techniques can not only help a business to stand their ground, but can also help them to move forward when they otherwise could not.