Inspiration meets innovation at Brandweek, the ultimate marketing experience. Join industry luminaries, rising talent and strategic experts in Phoenix, Arizona this September 23–26 to assess challenges, develop solutions and create new pathways for growth. Register early to save.
Other than our unending search for Bounty and Charmin, no brand occupied our attention last year like Zoom.
Thankfully, many other disruptors were worth following.
First, Elon Musk continued to disrupt two massive industries. SpaceX achieved 26 successful missions in 2020, including the first manned U.S. launch since 2011. Each cost a fraction of a government space expedition, partly because he invented the reusable rocket.
Through great product design, user experience and earned media—and with no paid advertising—he’s also created the world’s most compelling automotive brand. That’s why Tesla shares rose 635% in 2020, giving it a market cap seven times the combined value of GM and Ford, on a 10th of their revenue. What’s now the sixth most valuable U.S. company became the biggest ever to join the S&P 500. (Of course, given Musk’s volatility, the S&P may see some bumps down the road.)
Audacity of ambition
Second, Peloton is a perennial topic of debate in my Duke class. Will its business wither post-pandemic? I don’t think so. The at-home exercise brand sees itself as a “technology, media, software, product, experience, fitness, design, retail, apparel and logistics company,” not an equipment retailer. Its focus on brand experience and community has earned it the network effect, with ridiculously low churn and high engagement. From January to September, the average Peloton subscriber completed 21.2 workouts per month. Talk about habit-forming: That’s five days a week for nine months!
The sheer audacity of its out-of-the-gate ambition built a moat that makes it virtually impossible for Echelon and the like to become any more of a threat to Peloton than Reebok was to Nike. That’s why, putting 2019’s ad kerfuffle behind it, Peloton reached $2.4 billion in annual revenue, enjoyed its first profitable quarter and saw its stock price quintuple.
Fire-proof disruption
Finally, TrueFire Studios is a guitar-centric music education company that sold instructional cassettes six years before Netflix started mailing DVDs. Like Netflix, TrueFire Studios has aggressively exploited new technologies.
In fact, TrueFire is Netflix meets Khan Academy meets Peloton, with a dash of Patreon.
The legacy model: Find a teacher at the music store, commit to that teacher’s style and pay $50-$100 weekly for an experience that evaporates as you walk out the door. No wonder an estimated 95% of aspiring guitarists drop out within months of their first lesson.
The TrueFire disruption: Pay $21 a month for unlimited, anytime, anywhere access to over 40,000 classes in over 900 courses across every music genre, taught by hundreds of the world’s best guitarists like Larry Carlton, the four-time Grammy winner ranked #10 on Guitar World’s Greatest Guitarists of All Time. Use any teachers. Take any classes. Re-stream anything you want to revisit. For way less than the cost of an analog lesson, download any session you want to keep.
That’s the Netflix/Khan part.
The right element: a captive audience
The Peloton portion: TrueFire is a masterpiece of user experience. Every lesson is shot in HD from three angles. Below the video is real-time notation of what’s being played. With a click, see it in a different key. Select a phrase, slow it down as much as 75%, and replay it until you master it. Add visualizations of the string and fret played for each note or see it on a virtual keyboard.
Like Peloton, TrueFire is working hard for that network effect. Its social media footprint is double that of its biggest competitor, and it runs a host of live virtual events and jam sessions. It hosts over 50 videos on YouTube that have garnered over half a million views each. The result is a multinational online community of over 3 million guitarists.
The Patreon element is that TrueFire builds trusted relationships with artists by providing them with reliable new income streams. Recording a lesson for TrueFire gives an artist content with unlimited shelf life and scalability. Some earn well into six figures on TrueFire, and it’s not unusual for an artist to get several grand in royalty checks every month.
Privately held, TrueFire doesn’t release financials. But the company says revenue is up dramatically through the pandemic. With a captive audience of the most passionate players and learners, it is building a marketing database that can be monetized with partners like Gibson and Martin guitars. There’s also plenty of room for growth among the estimated 50 million guitarists globally.
And the company just acquired FaderPro, which TrueFire CEO Owen Grover says, “gives us an outstanding foothold in the vital, innovative and ever-evolving world of dance music, while also allowing us to better serve students who want to master the intricacies of at-home recording.”
If you’ve had your fill of biking and breadmaking, check it out. Research says playing guitar is good for your brain—but only if you actually learn to play.
Elon Musk, Peloton and TrueFire. My three favorite disruptors of 2020. How about yours?
