6 Stages of Cultural Impact

Apple may have tem­porar­ily appeased peo­ple who had prob­lems with their new iPhone but it is sit­ting at a dan­ger­ous point in terms of its cul­tural impact.

The Cul­tural Impact Cycle

Most suc­cess­ful com­pa­nies go through a 6 steps cycle where their cul­tural impact on soci­ety as a whole can be felt. For my pur­pose, I call it the mind­set cycle and it works as shown in the fig­ure below:

Alpha­world

In Alpha­word, the first step, a few early adopters are aware of the com­pany and its prod­ucts and test them out. This is gen­er­ally a stage most com­pa­nies do not get out of.

There are many rea­son for com­pa­nies not get­ting out of this space. Their prod­uct could be bad; their prod­uct could be tar­geted at the wrong mar­ket; their prod­uct could be too early in the mar­ket; the com­pany might have failed to explain its rel­e­vance to users; etc…

Ulti­mately, the main rea­son a com­pany gets out of this stage is that its team has done a very good job exe­cut­ing on the imple­men­ta­tion of a prod­uct and com­pany strat­egy, cre­at­ing value for its investors, and deliv­er­ing even more value to its users.

Those that make it out will be pros­per­ous and those that don’t will die.

The Land of Mass Adoption

The land of mass adop­tion then rep­re­sent a steep climb as a com­pany starts get­ting noticed by peo­ple out­side of the tech­nol­ogy world and non-technologists start using the application.

The major­ity of com­pa­nies that made it out of alpha­world spend a very long time in that area and can profit by tar­get­ing niches with­out hav­ing to move on to the next stage.

The land of mass adop­tion is an area where com­pa­nies are forced to shed some of their more tech­ni­cal attrib­utes (or hide them away) in order to appeal to a mass audi­ence. The mass audi­ence is not as for­giv­ing as peo­ple in alpha­world so the com­pany has to prop­erly adapt to the mar­ket. It’s a great bal­anc­ing act where the com­pany has to show early adopters that it can con­tinue deliv­er­ing cut­ting edge for them while talk­ing to the main­stream and fig­ur­ing out the right tim­ing and hand-holding to get main­stream users to start using some of those new attributes.

Main­stream Mountain

Main­stream moun­tain is where most com­pa­nies want to be. At that point, a com­pany achieves great eco­nomic suc­cess and is at close to the peak of its cul­tural rel­e­vance, impact­ing not only its own prod­uct but the indus­try it’s in. Very few com­pa­nies achieve that stage and even fewer stay there for a long time. The great major­ity of peo­ple look to the com­pany as the main provider of direc­tion and believe it can do no wrong.

In the 80s, IBM was there with its per­sonal com­put­ers. In the 90s, Microsoft was there with its Win­dows oper­at­ing sys­tem and Office Suite. In the first decade of the 21st cen­tury, the spot was held by Google with its dom­i­nant search engine, online adver­tis­ing model and YouTube video site.

Apple is cur­rently at the apex of main­stream moun­tain, hav­ing rede­fined the PC indus­try (com­put­ers as con­sump­tion), the music indus­try (dig­i­tal as default) and the tele­com indus­try (phones as com­put­ers). Face­book, with its social net­work is cur­rently climb­ing that moun­tain, hav­ing become the largest site in the world, built solely on the back of relationships.

Unfor­tu­nately, it is almost impos­si­ble to stay in that arena and the fall seems to even­tu­ally come for most companies.

Dis­grun­tled Hills

In the dis­grun­tled hills, the pub­lic per­cep­tion of a com­pany starts to turn. What was one seen as a benev­o­lent force for good is now being ques­tioned. Peo­ple start ques­tion­ing whether the com­pany is hold­ing too much power and the men­tion of anti-trust comes up more often. Early adopters start look­ing for alter­na­tive providers and any mis­step by the com­pany is seen as a major exam­ple of how flawed the com­pany is. Over time, the mass start turn­ing their back on the com­pany, reluc­tantly using its prod­ucts but no longer imbu­ing them with the kind of magic attrib­utes they granted to the company.

At this point, it seems the com­pany starts hav­ing prob­lems pleas­ing customers. No mat­ter what it does, the pub­lic looks to the com­pany as only pro­tect­ing its own inter­est and not those of its customers. The com­pany can claim that it loves its cus­tomers but sus­pi­cion seeps in and peo­ple get cyn­i­cal about such claims.

I would ven­ture that Google is cur­rently in that stage as peo­ple start wor­ry­ing about its dom­i­nance in the search space while mak­ing fun of its attempt at try­ing to get more social so it can go back to main­stream­ing moun­tain. Ques­tions around its pri­vacy prac­tices, men­tions of antitrust around search and adver­tis­ing, and other neg­a­tives seem to be applied to it with increas­ing frequency.

Canyons of Cul­tural Irrelevance

Of course, Google doesn’t have to worry as much as Microsoft, a com­pany now steeply going down the hill of cul­tural irrel­e­vance. At that stage, a company’s prod­uct are no longer seen as rel­e­vant to large swath of people.

Com­pa­nies that reach this stage were once seen as the most impor­tant com­pa­nies in the world. Often­times, such com­pa­nies also suf­fered legal set­back as they were taken to court and found guilty of monop­o­lis­tic prac­tices. Such was the case for IBM in the 80s and Microsoft in the 90s.

To say that a com­pany is in that space is not the same as say­ing the com­pany can­not be prof­itable. In fact, Microsoft an IBM are still very large play­ers with estab­lished cus­tomer bases and diver­si­fied prod­uct port­fo­lios. But their impact on the indus­try is mainly felt when they acquire a com­pany posi­tioned in one of the ear­lier mind­set stages. Their abil­ity to deliver internally-created prod­uct to an audi­ence that finds a par­tic­u­lar attach­ment to such prod­ucts seems hin­dered and the com­pa­nies take a cau­tious approach, offer­ing prod­uct that attempt to mir­ror fea­tures cre­ated by other play­ers (eg. Zune v. iPod, Win­dows phones vs. iPhones, Microsoft Kinect vs. Wii).

This stage can last decades or even cen­turies but, at that point, the com­pany is no longer hav­ing a sig­nif­i­cant impact on con­sumers’ mindsets.

Plains of Cor­po­rate Death

In some cases, a com­pany can flash through a lot of the ear­lier stages, be seen as extremely rel­e­vant for a while and then dis­ap­pear because their prod­ucts and ideas are no longer valid in the mar­ket­place at all.

This is a case where com­pa­nies have cash or assets that are no longer valu­able in any ways (eg. Buggy Whip man­u­fac­tur­ers) and, in those cases, com­pa­nies com­pletely fold and return money to their share­hold­ers, stop­ping to exist due to cul­tural irrelevance.

Few com­pa­nies enter that stage as the pre­vi­ous one allows them to morph into some­thing dif­fer­ent (eg. Nokia comes to mind, chang­ing from being a fish­ing boots man­u­fac­turer to a phone com­pany; or WPP going from being a wire and plas­tics com­pany to one of the largest adver­tis­ing groups in the world).

Take­away

There are many stages in the cul­tural impact of suc­cess­ful com­pa­nies but ulti­mately, every large tech com­pany has found itself dis­placed and replaced. Today, Apple sits at the apex of the tech indus­try, hav­ing achieved eco­nomic and cul­tural dom­i­nance, but the Anten­na­gate brouhaha (around claimed issues that the iPhone 4 antenna fails when the phone is held with­out a bumper) and the giz­modo inci­dent seems to point to some anx­i­ety within the early adopter com­mu­nity. Per­cep­tion of the com­pany appears to be turn­ing and, for the first time since Steve Jobs came back to Apple, there seems to be some level of unhap­pi­ness with its prod­ucts. Will the release of free bumpers help the sit­u­a­tion? Only time will tell.