If history has taught us anything, it's that everything changes. Like the saying goes, change is the only constant. In business, this means that if you're not constantly evolving, you're risking your survival. If you are not causing the disruption, you might be disrupted.
We've seen this throughout history. Companies like Kodak, and Polaroid, dominated the camera industry, yet failed to evolve into digital photography. They were in a perfect position to disrupt themselves, yet they didn't, and they were disrupted by digital cameras. To continue the trend, digital cameras were phased out when smartphones started touting better digital imaging abilities. It's likely that one day smartphones won't be the dominate user interface.
What does this mean for you? It means you must constantly evolve, even if that requires disrupting yourself. It means you must keep an eye on the future, both in terms of technology and consumer trends.
This is not an easy task for many entrepreneurs and leaders. To help underscore the importance of this trend, consider the following five examples of companies that have evolved ahead of the disruption curve - and how they did it.
Apple is perhaps the best example of a company that made innovation and evolution its identity. Started in 1976, Apple pioneered the personal computer and the graphical user interface. It quickly garnered massive market and financial success. Yet it didn't stop innovating.
In 2001, Apple introduced the iPod music player. It was another commercial success and forever changed the music industry. Yet in 2017, Apple discontinued most of its iPod models. Why? Because in 2007, Apple announced the iPhone, yet another massively successful product that would propel Apple to become the first Trillion-dollar company in history. In doing so, Apple made their own iPod obsolete, adding the digital music features into the iPhone.
The big takeaway is to see what's possible when innovation is your company's DNA. Apple had no business in music, yet they innovated the entire music industry. They had no business in the telecom space, yet the iPhone forever changed the telecom industry and our daily lives. They disrupted an entire product line with a new and more versatile product line.
The challenge is now on Apple to continue innovating as iPhone sales slow down. Can they do it again? Only time will tell.
When Kabbage was founded in 2009, its mere presence in the young fintech market made it an innovator. To give small business owners an easier way to access capital, Kabbage rolled out one of the first platforms that provided a fully automated funding decision by analyzing a company's real-time data instead of an outdated paperwork process. By connecting data sources like bank accounts, bookkeeping software and more, Kabbage users can apply, be approved and access a line of credit up to $250,000 in less than 15 minutes. That is significant for any small business owner.
Ten years later, Kabbage isn't sitting idle. When Alibaba.com began planning its U.S. market strategy in 2018, Kabbage partnered with the Chinese e-commerce giant on a Pay Later program. As a result, Alibaba shoppers can access up to $150,000 in credit.
In this case, a partnership was the path to evolving and staying relevant in a competitive finance industry.
Netflix is now a part of everyday life for the tens of millions of people around the world that subscribe to its services. As of March 20, 2019, Netflix's market cap was over $160 Billion. Yet the Netflix of today looks very different than the Netflix that started in 1997.
Netflix disrupted the video rental business by allowing consumers to rent DVDs via the mail. In September 2002, according to the New York Times, Netflix mailed around 190,000 discs per day. It could have easily rested on its laurels, yet Netflix predicted that streaming video would soon replace the DVD player. That prediction was correct, and in 2011, Netflix had around 23 million subscribers.
Once again, Netflix could have sat back and enjoyed the billions in revenue from its streaming services, but they didn't. Netflix understood that owning the content provides significant negotiation leverage in the media landscape. They started investing in producing their own original TV series and films, allowing them to benefit from owning the content into distribution.
Netflix is a perfect example of a company that disrupted itself in many different ways.
When Spotify launched in 2008, most music consumers still bought and stored their own music files. By giving users access to more than 40 million songs, Spotify supercharged the streaming market while fighting media piracy.
Spotify has since rolled out a series of innovative advertising campaigns. One of its latest, called "2018 Goals," turns user-generated content into amusing and heartfelt print advertisements. The campaign effectively brought Spotify from the digital-only space into the physical one and led to significant sales growth. According to their website, Spotify is the music industry's single largest driver of revenue.
Another example of Spotify's ability to evolve is its recent focus on podcasts. Podcasts have become a popular and important form of content and Spotify aims to invest significantly in podcasts and podcasting technology.
5. Say / Shelter Insurance
Founded in 1946, Shelter Insurance started with a simple mission: to provide affordable auto insurance. In the years since, Shelter has grown into a leading insurer, with over 4,000 employees and $5.4 Billion in assets under management. While its focus has been on home, life, car, farm and business policies, it needed to address the generational shift to millennials, and their preferences.
In an effort to cater to millennials, the company rolled out a new brand called Say Insurance. Although the brand is still young, Say has made a name for itself through an auto insurance "score" that they assign to a new, existing or prospective customer. The score allows consumers to see how their driving and financial history impacts their rate. The additional clarity provides peace of mind and allows consumers to make desirable changes to improve their score.
Evolution is not always about technology, and this example shows how to successfully navigate changing consumer dynamics. As a millennial, it's refreshing to see a financial company place a priority on clarity and involving consumers in the process.
The only guarantee in life is that things will change. It's true with the evolution of species and in business. Just like all the complacent species in the animal kingdom, complacent businesses will go extinct. The companies above thrived because they were willing to change with the shifting factors around their businesses. And the results speak for themselves.