By Ms. Cheng, blogs.wsj.com
Tech entrepreneurs and investors are always looking for the next big thing. Most reference the “next Facebook” or nascent technologies such as Oculus Rift. It’s not just about the next big exit or cutting-edge technology — the next big thing fundamentally changes economies. Identifying the next big thing is tricky because there are so many variables that go into a startup’s success or failure: market timing, team, product market fit, adoption, etc.Identifying tomorrow’s hot trend is extremely difficult, but whatever it is, it will likely change the way consumers interact with the physical world and will be widely adopted.
The next big thing will disrupt how an existing industry does business. Industry value chains develop over decades, and inertia becomes the biggest barrier to innovation. Startups that force traditional businesses to change the way they operate by removing inefficiencies and friction will develop products and services that people love. Waze did this to maps and navigation and Airbnb is doing this to hospitality. These companies democratized data, removed friction from transactions and provided choice and access that was previously unavailable. They created new alternatives for consumers, and in doing so changed the value proposition and economics of entire industries.
In addition to solving an industry problem, the next big thing needs to solve a consumer problem that people care about. People cannot always articulate what problems they need solved, but they can be observed in everyday life – booking travel, going shopping, taking classes, driving to work, etc. Consumers are willing to part with a lot (money, personal data, etc.) if your product solves a real problem. The mobile era is a particularly opportune time to solve meaningful consumer problems because smartphones are now ubiquitous, highly personal and always connected. They are the ideal platform for entrepreneurs who are trying to solve real-world problems through scalable technology solutions.
Identifying industry opportunity areas is just the tip of the iceberg for companies trying to come up with the next big thing. Building a product that consumers will flock to and stay with is just as important as identifying the opportunity area. Consumers today are bombarded with options, and cutting through the noise requires elegant design and user experience. Simple products that can do powerful things will delight users and change behavior. Particularly on mobile, consumers demand product elegance. For example, Uber and Tinder may not have been able to disrupt legacy industries if they had not designed for simplicity to create a memorable consumer experience. They have achieved tremendous growth and widespread adoption, due in no small part to their designs.>>>