The Power of Cool

Sat, 30 Apr 2011 23:15:00 GMT

Inspired by a recent Wired magazine article entitled "VP of Gaga" I started to think about what I call the "Power of Cool." By power, in this context, I mean real economic power. That sort of power exists primarily in the consumer world, particularly in consumer electronics. Have you picked up any Apple product (even a 27" iMac, which is hard to pick up) in the last 5 years and not thought "cool"? Of course you haven't. Have you seen, let alone tried on, let alone listened to a set of Monster's Beats headphones and not thought "cool"? Of course you haven't. None of us have. So we know "cool" when we see it and we like it.

"Cool" has real economic power to be sure. "Cool" drives higher margins and accelerates products through the Technology Adoption Life Cycle much faster than those of the competition. Tablet computers have been around for years and years, but Apple produced one that is really, really cool. It rocketed through the Early Adopters, crossed some razor-thin Chasm, avoided any Bowling Alley and Tornadoed all in about 6 months. "Cool", indeed. Apple created and maintains massive share in tablets that gives it real power. We define this power as a strong bargaining positioning with suppliers and customers. Think of how fast app developers jumped onto the platform leveraging the new form factor. Video sales surged since consumers could now watch HD movies on something larger than their phone. Oh, that's right, it was their phone.

When thinking of "cool" and our Hierarchy of Powers model, it's easy to claim that "cool" has real economic value. Apple made the category of tablets cool again, just like they made (re-made, really) the category of portable music players cool again with iPod. Can companies be cool? Absolutely. Ask 100 people on the street who's cooler: Microsoft or Apple. Heck, even in Redmond Apple will always take the crown, even if with a look-over-the-shoulder-first-whisper. While Execution Power and Market Power may not be cool, creating an appealing product (Offer Power) is most definitely "cool".

What if you don't have "cool"? What if you're Intel or Polaroid? Well maybe when confronted with the build vs. buy decision you can just buy it? Intel recently announced will.i.am as their director of creative innovation. Employees went nuts. Lady Gaga is making her mark at Polaroid as a creative director and she made her mark at Monster Cable a long time ago. I had the pleasure of visiting Monster cable in Brisbane, CA on the day that a sign in the lobby said "Welcome Lady Gaga". Wow, I thought, this is cool!

Whether buying "cool" vs. building it into your corporate DNA will actually work is yet to be seen, particularly in the case of my favorite Black Eyed Pea and Intel. But, you can't blame them for trying.

will.i.am inside? That's pretty cool.

Brett Bonthron, Partner, Chasm Institute LLC

The Power of Cool