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Scott Galloway@profgalloway

Published on July 28, 2017


As the term “innovation” becomes the biggest whore in the English language, it’s useful to think of what changes to product, marketing, or retailing processes result in meaningful value, vs. a press release that solely reinforces the perception of your firm as an innovator. True “unlocks” are more substantial, if not sexy, in nature. Burberry is an innovator, but has registered few real unlocks — more sizzle than steak.

So, what are some of the great retail unlocks, and what can be learned?

Amazon (yeah, no shit)
Amazon is the queen of unlocks, making massively expensive bets across the boring stuff (speed, convenience, value). These bets build moats that become (wait for it) Amazonian. A multibillion, multidecade investment in last-mile fulfillment may be the widest moat built in retail. The most underrated unlock was user reviews, which have transferred substantial power from brands to consumers, and made Amazon the most trusted retailer in the world, as they were the most transparent.

The most recent unlock, which briefly made Jeff Bezos the wealthiest man in the world yesterday, is the decision to exit the difficult business of episodic revenues (retail) and develop a software-like business model. The recurring revenue relationship that Amazon has established with 60M wealthy US households through Prime is second only to Microsoft’s Office franchise.

Apple owns the business decision responsible for the greatest increase in shareholder value in modern business. Most would posit it’s their decision to release a phone. They would be wrong. The greatest unlock in modern business was Apple’s irrational decision to forward-integrate into retail and open 500 temples to the brand. As broadcast advertising became a tax that increasingly only the poor and technologically illiterate had to pay, Apple realized that luxury-like margins on an underpowered product required a focus on where consumer relationships are consummated — in the store. Samsung is, in my view, an equally impressive company, but Apple is the better brand and has become the greatest cash machine in history with what must have, at the time, been a ridiculously stupid idea: “let’s open stores.”

Best Buy
Written off for dead, Best Buy punched the shark, Amazon, in the nose and asked the only question a firm needs to ask when shaping their strategy: What can we do that’s really hard? The answer was develop the systems and culture to turn their 1000+ stores into flexible warehouses. Best Buy can now get a flatscreen, ordered online, to your house faster than Amazon. In addition, they went where Amazon could also not venture, and invested in organic capital — store associates. Similar to Home Depot and Sephora, Best Buy’s blue shirts are recognition that consumers no longer go to stores for products, but people.

Innovation mixes agility, PR, new-economy technologies and platforms, and agreement to fail fast, learn, and move on. Unlocks are the domain of nerds who make fairly mundane observations (customers want stuff faster, brands are still built at the store level, the people in stores need to be good) and combine operational excellence with steadfast commitment of capital and time. Unlocks are a conspiracy between executives who brighten up a room by leaving it, and boards and investors who don’t scare easy — willing to invest for the long-term.

Time of Our Lives

My nine-year-old is leaving for camp, for the first time, tomorrow. I have a strange sensation in my feet, hollow yet tingly, and I’m not as much sad as numb, feel nothing. This how I experience mild depression. Not sure if the catalyst is concern for him in a new environment — he’s social but a bit awkward — or that, more likely, this is a marker of time: I’m going to die soon.

I’m in a sweet spot with my boys. They are old enough to be my buddies, but young enough to revere time with me. I’m confident they’ll love me the rest of their lives, but them liking me (right now) feels incredible, and fleeting. I watch soccer every day with my oldest, and whenever I’m reunited with my youngest, like walking through the door, he boasts of something he’s done or shares information he knows I’ll find fascinating.

Time and progress have been for me like the Big Wheel that populates the front of casinos. As a kid, it was too big to move it. My mom’s hand on the wheel, and that of the University of California, got the wheel moving. Morgan Stanley, grad school, luck, hard work, America, the internet era, and cheap capital really got the wheel spinning. But now that I’ve finally arrived where I was trying to get (meaningful relationships, relevance, economic security), the wheel won’t slow. Time is, as it does, becoming smaller relative to an increasingly broad horizon — the amount of time I’ve been here — and years are beginning to feel like months.

An atheist, I’ve convinced myself that I experience time as more finite than most, since I’m 100% convinced the last time I look my loved ones in the eyes I will know our relationship is over — we won’t be reunited.

This. Is. It.

Note: I acknowledge I can be as obnoxious about my atheism as any zealot, and that the notion of an afterlife isn’t any more ridiculous than my view that in the beginning there was nothing, then a big explosion. But that’s another post.

I’ve got 10 more holidays with my boys, and 40 more with everyone else. Again, the hollow feet feeling. So, how to slow time’s relentless march? Humans are good at guessing the time, always have a decent sense of what time it is, but don’t perceive it well — our brain registers time at different speeds. Dr. David Eagleman, neuroscientist and foremost researcher on time perception, believes time is a construction of the brain, and our minds filter the info before presenting it to us. When we experience fear, pleasure, or novelty, our senses become heightened. Our brain stands at attention and records more information, slowing time.

We are seriously considering moving abroad for a couple years. The best argument I can make in favor of the move is not that it will be better (we have nice lives), but it will be different, and living in multiple cities will make our perception of the time we had young children at home greater.

I also think a lot about extending time at the end of life — strange, I know. However, I’ve embraced the strange in me and deluded myself into thinking it’s a feature, not a bug. For the last two years I’ve been using an app, “One Second Every Day,” that lets you capture (you guessed it) one second of video each day. I miss half the days, so 40 years from now I’ll have around two hours of video. I plan to be at home, surrounded by loved ones, and then am going to experiment with hallucinogens and live my life over, in two-hour increments, several times.

I wonder if time for any of my work colleagues (boss, someone in HR, the 26-year-old who sits next to me) slowed down reading the word “whore” above or discovering my intention to try psychedelics. Not sure. However, I’m certain their (non-)reaction, and my son’s second and third summer camp, will come sooner than I’d like.

Life is so rich,



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