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April 10, 2016

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How an old sneaker saved Lego

“SMALL Data: The Tiny Clues That Uncover Huge Trends” is the latest book on brands and consumer behavior by Danish author Martin Lindstrom. It contains a miscellaneous collection of “turnaround” cases that he and his team have helped to crack or decode in the past years for some of the world’s leading brands, such as Lego, Pepsi, Disney, as well as new business models in emerging markets Russia, Brazil, India and China.

With interesting anecdotes, Lindstrom explains how small data — seemingly insignificant behavioral observations — can actually point us toward huge insights about the imbalance in our lives, thus revealing our hidden desires and unmet needs, and, ultimately, the clues to a multi-million dollar product or brand.

“Humans are prone to seeing the world in different ways — while still being more similar than we ever imagine — that’s what this book is about,” said the international best-selling author at the global launch of his new book in Shanghai last month. The launch was hosted by brand experience agency Jack Morton Worldwide which is partnering with Martin Lindstrom to incorporate Small Data thinking into its work with brands.

“A single drop of blood contains data that reveals nearly a thousand different strains of virus, providing that your sample is well chosen,” Lindstrom said.

The first and foremost case is of course Lego, a brand for which Lindstrom served as a “consumer” at the age of 14. Lindstorm gave Lego executives insights on their product by observing his own behavior and that of his friends.

In the 1990s, Lego’s sales were declining. Every big data study Lego commissioned drew the exact same conclusion: Future generations who’d come of age in the information era lacked time and the patience for Lego. Swayed by this data, Lego started to dumb down its toys, making the kits simpler and even increasing the size of its iconic bricks.

Despite the changes, the company kept losing money. To save Lego, Lindstrom and his Small Data team paid a home visit to an 11-year-old boy in a midsize German city in 2004. The boy, in addition to being a Lego aficionado, was also a passionate skateboarder.

When asked at one point which of his possessions he was the most proud of, he pointed to a pair of beat-up Adidas sneakers with ridges and nooks along one side. Those sneakers were his trophy, he said. They were his gold medal. They were his masterpiece. More than that, they were “evidence,” as Lindstrom jotted in his notebook.

At that moment, those theories about time compression and instant gratification collapsed. It dawned on the Lego team that for kids, if the skill is valuable, and worthwhile, they will stick with it until they get it right, never mind how long it takes.

Based on this small, chance insight provided by an old pair of sneakers, the company not only re-engineered its bricks back to their normal size, but also began adding even more, and smaller, bricks inside their boxes. In the first half of 2014, Lego had surpassed Mattel to become the world’s largest toy maker.

“Small data comes from observation and causation — the reason ‘why’, whereas big data is calculated through correlation. Solely relying on big data does not yield real information about a consumer’s life,” Lindstrom explained.

As he further points out in his book, big data and small data are partners in a dance, a shared just for balance. While big data derived from millions of impersonal information tends to predict the future trends at work, it is the uniquely human small data right in front of us that reveal the real children inside of us.

I am not a marketer, but the book drew me in because of its rich details and insightful observations in our daily life that threaded together like a detective story. Many a time I can’t help but to pond on the subtext behind each behavior that Lindstrom has spotted, to see if I can come to the same conclusion as he does:

Why are most fridge magnets in Russian homes put at waist level rather than the eye level? Why are Saudi women are afraid of burning buildings, though no mall has ever caught fire in Saudi Arabia? Why have oil-based lotions vanished from girls’ bathrooms in Austria in only a decade? If Chinese cars share almost exactly the same features and options as European-branded cars, why do Western cars outsell them, even in China, by a three-to-one ration?

Every single thing we do leaves behind small clues that speak to who we are, and what we desire. In a world obsessed with big data, the next big thing is perhaps what Lindstrom calls the small data revolution — the human-centric alternative to big data.

In an interview, Lindstrom shared more surprising truths about himself and brand building.

Q: How does small data affect or benefit your personal life?

Over the past 15 years, I’ve interviewed thousands of men, women and children in their homes in 77 countries. I’m on a plane, or inside a hotel room, 300 nights a year. The drawbacks of living a life like this are obvious. I can’t really call any place home, relationships are hard to sustain, and children and pets aren’t an option.

Q: How do you manage to keep your observant eyes sharp all these years?

The ability to spot options and possibilities comes only when we open our mind. In this case, I’m not talking about politics, or religion, but rather, about letting down our personal guards, leaving behind our well-appointed offices, and moving in with strangers, all the while not revealing anything about our backgrounds, achievements or talents.

Q: What is a brand?

I define a brand as anything from the music on our playlists to our shoes, to our toothpaste, to the artwork hanging on our walls — they have profound things to say about who we are. Every successful brand stands for something more than itself, and that thing is emotional. A great brand promises hope, or desirability, or love, or acceptance, or luxury, or youth, or sophistication, or high-quality technology.

Q: What problems have you observed when Chinese products try to brand themselves both at home and abroad?

There is an overemphasis on rational thinking and a disregard for the emotional ingredients that go into brand building. The reasoning among Chinese companies goes something like this: a product is a brand. A brand is a logo. If a logo is prominent, then consumers, sales and profits will follow. However, if the emotional aspects of branding are underestimated, it is usually the companies that pay the price.


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