Can Consumer Products Companies Pivot From Product To Content?

Don Gordon

Full disclosure: I watched season one of “The Apprentice” and enjoyed it thoroughly. I gaped with eager horror as he berated, humiliated, and discarded contestants who seemed deserving of the treatment if only because their highest aspiration in life was to curry favor with Donald Trump. In the end, I admired his chutzpah for casting himself as the anti-hero of his own reality show. Which is more or less the tack he’s taken throughout the presidential election. But what happens if he’s the one who ends up getting fired – or not elected, at any rate?

To employ a Trumpian formulation, a lot of people on the Internet are saying that Trump will launch a TV channel if he doesn’t win. It may sound like an odd move for a man typically known for apartment buildings, steaks, neckties, and cologne. But consider the volume of content he generates. It’s not just that he has sent* 34,000 tweets versus Hillary Clinton’s 9,000. Since Trump announced his candidacy, the major national TV networks have mentioned him 1,109,495 times, compared to Clinton’s 525,615. Add to this the countless books, newspaper and magazine articles, and blogs, and it becomes undeniable the man is a content-driving machine.

But it’s not just Trump getting into the content business. Think about AT&T’s $85 billion bid for Time Warner. With this one not-so-simple deal, a company known for telecommunications dials up CNN, TNT, and HBO. Following its merger last year with DirecTV, AT&T will soon be able to stream Game of Thrones, The Walking Dead, or even Philadelphia 76ers basketball games to any Internet-connected device. Just as important, it can employ its ridiculous volumes of consumer data to develop and deliver content in a highly targeted way.

Another example is Alibaba Group, the $25 billion company known primarily for B2B e-commerce. Its eBay-like auction site, Taobao, has nearly a billion products and is one of the world’s most-visited websites. Recently I saw Alibaba’s founder, Jack Ma, interviewed on television, and he made a fascinating assertion: “We only sell products so that we can get data.” It sounds like a variation on a corporate cliché – Welcome to Spaghetti Trough, now a data and technology company! – but in Ma’s case it rang true. Sure enough, a couple of weeks ago he was on stage with Steven Spielberg to announce that Alibaba will be co-producing movies with Spielberg’s Amblin Partners. Sell the products, get the data, create and deliver the content.

You’ll often hear consumer products companies talk about better exploiting consumer data – but it’s almost invariably stated in terms of targeted offers or cross-selling. In other words, “now that we know you, we can try to sell you more of what you bought.” But a man can only eat so much spaghetti out of a trough. So why aren’t more product companies pivoting to content creation? My seventh-grade son will save his allowance for two months to buy an Under Armour t-shirt. His friends all wear them too. What kind of Under Armour content would they pay for? Exclusive video of Steph Curry joking around with his adorable daughter Riley? A movie starring Cam Newton and Clayton Kershaw as international spies? A book of photographs of Tom Brady with his good friend Donald Trump?

I don’t claim to know which content there’s a market for (I have only limited data), but I am certain the market exists. And consumer products companies that take advantage are likely to experience astonishingly excellent results.

*all numbers accurate as of 10/26/2016

To learn more about how you can be better prepared for moments of market disruption, visit Consumer products: Reimagined for the new economy.

About Don Gordon

Don Gordon leads global Consumer Products industry marketing for SAP. Previously he led global Retail industry marketing for IBM. He lives in Philadelphia, considered by many to be the finest city on earth.