Mind the Gap. The In-Between Disruptive Innovation Strategy
When John Osher, a serial entrepreneur, was looking to expand his SpinPop Lollypop business, he went ‘prospecting’ with his team. They paced up and down supermarket aisles looking for gaps in product categories where they could apply their core technology, a small electric motor that would cause a consumer product to spin.
During one of their prospecting missions, they noticed the wide product and price discrepancy in the toothbrush aisle. The manual, plastic toothbrushes generally sold for under $2 while the high-end plug-in electric toothbrushes sold for at least $50, if not over $100. There didn’t seem to be a middle-end product. That gave them the idea of introducing a AA battery-powered toothbrush (using their small motor technology to make the brush spin) that would sell for approximately $6 to close this obvious gap. To make a long story short, John Osher and his Dr. John’s company introduced the highly successful SpinBrush product line, which a few years later, was sold to Procter & Gamble for almost $500M – not a bad payout for a walk down the aisle! Note: SpinBrush is now part of Arm & Hammer (which added a cool bone conduction, tooth tunes feature!).
There are many examples of successful companies that have ‘minded the gap’ in a particular product category. Starting with, who else, the GAP stores, positioned in between Old Navy and Banana Republic for its parent company. Carl’s Junior fills the gap between fast food hamburger chains and burger sales at full service restaurants. Uber car service fills the gap between a Taxi and reserving a town car well in advance (matching real-time demand/supply). Blinds-to-Go, a made-to-order blinds category killer, where I worked in the past, fills the gap between instantly available, cut on the spot no-frills blinds at Home Depot and decorator ordered Hunter Douglas custom, high-end blinds.
In the luxury segment, there are many ‘mind the gap’ strategists appealing to one’s sense of “Aspiration”, including Gucci and Louis Vuitton (not as high end as Hermes, and Loro Piana aimed at the ultra-wealthy), but higher end than “Accessible Luxury” brands such as Coach and Hugo Boss. Another way to creatively play the gap here (Between high-priced luxury products and affordable products) is what the Gilt Groupe has introduced – private sales of unsold merchandize at deeply discounted prices.
In the discount retail market, ‘Tar-zhay’ is certainly positioned in the gap between Wal-Mart and department stores. Target sells “Expect More, Pay Less” vs. Wal-mart’s lowest cost message of simply “Pay Less, Live Better”.
Some of you may be trying to become disruptive in a given industry by drastically changing the consumption pattern of a given good, by either dramatically dropping the cost and becoming the lowest price, good-enough option for those who couldn’t afford the goods before or introducing a new basis of competition, emphasizing a new attribute to those who were consuming but overpaying (in their minds). This essay is a reminder that a disruptive strategy could be in the gap of a given product category – you don’t necessarily have to be on the low end (John Osher didn’t try to undercut toothbrushes through a .10 cent toothpick), but you certainly are trying to undercut the most expensive option to allow for greater consumption (still providing an empowering innovation, as Clayton Christensen would put it, not simply a sustaining or efficiency innovation).
See if the new offerings you’re developing fit the ‘mind the gap’ label and approach, and or use the thinking to walk down a literal or figurative aisle of opportunity in your future endeavors.