Editor’s note: Nicole Munsey is a director at research company Ipsos InnoQuest, Chicago. This is an edited version of a post that originally appeared here under the title, “Share of buttons? Yea, that’s a thing now.”
The other night, I logged onto Amazon looking for a new book to download. (Let’s all just assume it was something really smart about innovation strategy and not the latest young adult dystopian-future novel series, shall we?) As soon as I logged on, I was presented with a home screen image of a hand holding a button-like contraption with a Tide logo on it. As a Prime member, Amazon tells me, I have exclusive access to Amazon Dash. I made a mental note to figure out what this was the next day and settled into my dystopian-future novel riveting book about innovation strategy.
The next day my inbox and news feeds were flooded with articles about Amazon Dash. Is this an April Fools’ Day joke, some of the articles wondered? No but perhaps it is a brilliantly timed launch to get people asking the question and talking about it. Did this just change the future of shopping? Did the Internet of things (IoT) just reach a tipping point? Yes. No. Maybe. It depended on which article you read. Working primarily in CPG, my first thoughts were around how something like Dash could impact my CPG clients … and also, that Dash seemed like it was just ripped from the world described in my innovation strategy book dystopian-future novel.
What is Dash and why do I care?
Dash is, simply put, Amazon’s 1-Click ordering in physical form right in my house. It’s a little button, or rather, many little buttons that I can choose from. I get a button – a Tide Pod button, a Cottonelle or Gillette button – and place it somewhere convenient in my house (it comes with adhesive and hooks for easy placement), for instance on the bathroom counter or adhered to my washing machine. When I’m running low on Tide Pods, I push the button. The button is synced to the Amazon smartphone app and just by pushing the button once I have a refill order of Tide Pods on its way to my house.
There are already over 250 products/buttons available on Amazon’s Web site, with a promise of many more to come. Dash 2.0 is already in the works – Dash Replenishment Service – which will allow appliances like Whirlpool washing machines to automatically sense when I’m running low on certain consumables (laundry detergent) and re-order the product for me automatically – thank god, I’ll no longer have to go to the trouble of pushing a button.
Why do you care about Amazon’s latest innovation? If you’re not Cottonelle in toilet paper or Tide in laundry detergent, you’ve got a problem with me (and likely many of my Millennial friends) … I ordered the buttons and by default, I just became 100 percent brand loyal to those brands.
That’s right. I just gave my loyalty to Cottonelle, Tide or any of 250+ other brands. Not because they are necessarily better quality or better priced but because they have buttons, and I don’t have to think about buying toilet paper and laundry detergent anymore. If you don’t have a button, how do you even get in my consideration set anymore? I’ve actually stopped considering the category entirely. I just push a button and the product shows up at my house.
The IoT, Dash buttons, automatic re-orders of previous purchases and automatic replenishment of supplies by our smart homes and our smart appliances are now fundamentally changing the way we interact with brands and categories. We don’t have to interact with them anymore. The challenge for CPG marketers in this dystopian world of the IoT is how to become the brand consumers rely on within a category so they can stop thinking about the category entirely.
You’ve got to get your button in my house.
Which means developing an IoT strategy that partners with retailers, appliance/durables makers or markets directly to consumers to get them not just to buy your product each time at the store but to install your button, your app or buy the washing machine that automatically re-orders your detergent so that consumers automatically buy your product every time.
But you’ve also have to think about how many buttons consumers are willing to put in their homes.
But, I make toilet paper … now I compete against razors?!
You sure do. Just thinking about the bathroom: I could have buttons for a smorgasbord of shampoos, conditioners, hair sprays, make-up, skin care, soap, razors, toilet paper, toothpaste, etc. The reality is, I’m not going to decorate my bathroom with dozens of Dash buttons, even if they are all for different categories of things I need. Which means your IoT strategy must also think about how to compete against adjacent categories for a share of buttons. As a consumer, I’m going to stick either a razor button or a toothpaste button on my bathroom counter but not both.
The situation is similar if you have an app instead of a button. I might download a couple of CPG apps and a couple of retail apps but I’m not going to download all of them. Now you’re competing against other apps for share of my phone space!
I’m also only going to buy so many washing machines and coffee makers, and if I want them to do my product shopping for me, I’m going to be buying whichever consumable brand with which my appliances have partnered. Here at least you’re still competing within your category but selling to a different customer. In addition to consumers and retailers, you’ve also got to think about how to get your detergent or coffee partnered with the appliance makers and other adjacent categories innovating around the IoT.
Share of buttons – that just became something we have to think about and act against. Yep, in addition to share of volume, share of sales, share of shelf, share of wallet and share of voice, we’ve got to be thinking about share of buttons. This not only means actual Dash buttons but more broadly, thinking about a CPG world in which consumers are increasingly shifting from low involvement to no involvement with apps, Web sites, buttons and even household appliances auto-ordering.
Despite the numerous predictions over the years of an explosion in digital CPG marketing and shopping behavior, it’s still only a fraction of overall CPG sales and marketing. The IoT is still more of a discussion topic than an everyday reality. And while we don’t know when the tipping point will be, there will be one.
In the meantime, the launch of Dash does underscore that the next big thing to grow share, or sales, in a CPG category might not have anything to do with new product development within the category. It may, however, have everything to do with how people interact with (or don’t interact) the category, how they shop (or don’t shop) or which player in the category had the foresight to partner with the washing machine maker or the e-tailer on their new innovation.