if you examine how different the juvenile industry marketplace is today versus 20 or even 10 years ago, you'll understand why you may be suffering from a case of manaGerial whiplash. knowing how to both adapt to changes and recognize new opportunities as the world around you evolves is a necessary leadership skill. but it's certainly not getting any easier.

Rapid change is, of course, not a recent phenomenon. During the 32 years I managed The First Years, our business model had to be substantially redesigned multiple times to deal with changes in the marketplace. However, the challenge for companies today is that radical marketplace changes are coming faster than ever and from all directions at once. 

What Has Changed in the Last 20 Years?

My thanks to the industry veterans and leaders who provided me with their insights for this post. Here's what they felt are the most important differences between doing business in the juvenile industry today versus 20 years ago:

Channels of Distribution

The degree of disruptive growth of e-commerce wasn't broadly anticipated 20 years ago. Not only has it changed the way products are delivered to consumers, but it has changed the way consumers make their buying decisions and what their expectations are regarding delivery and customer service. It's estimated that over 50% of juvenile products sales are now online. In contrast is the marked reduction in the number of specialty and mass merchant brick-and-mortar locations. 

Consumer Purchasing Process

Today's baby product consumer has a vast array of readily-available sources of product purchase advice as well as the ability to easily compare prices. Online reviews on Amazon and elsewhere, the proliferation of influencers, social media networks, Facebook mothers' groups, registries, baby tracker apps, and online parenting guides, are just some of the available resources. "Word-of-mouth" is no longer something that happens just among friends and family. It's now super-powered by social media. Add the fact that parents are waiting longer to have children and the result is that moms and dads are more knowledgeable and selective than ever. They know what they want and are generally willing to pay to get it as long as they're getting the best possible deal.

Marketing Strategy

The effect of all this is that marketing to new parents is radically different than it was 20 years ago with the need for companies to acquire social commerce skills and expertise. The good news is that marketing can be more targeted and less expensive than it used to be. The days of ad and PR agencies just asking you how much you want to spend are long gone. Instead, it's all about analyzing and managing marketing effectiveness using the data that's now available.

Competition

Consolidation has resulted in fewer, stronger, broad-line US juvenile product brands. But there are also more single-product or category-specific mid-size companies who have been successful by competing based on innovation. 

Over the past 20 years, Chinese suppliers have become much more technically sophisticated and savvy about global marketing and they are increasingly directly competing in the US market themselves. Platforms like Alibaba and Wish are examples of the ease of foreign competitors reaching globally. Of course, US companies have the same opportunity in foreign markets. 

Meanwhile, online channels like Shopify and Amazon are making it easy for US startups to gain distribution and test their product's appeal without heavy investment. However, long-term success for new entrepreneurs is still a challenge because of inexperience and regulatory hurdles. 

Sourcing

By the 90's, juvenile product production was pretty much consolidated in China with larger bulky products not requiring much assembly continuing to be made in the US. In recent years, the increasing US-China rivalry, tariffs, and the pandemic have been supply chain monkey wrenches that are accelerating the US company search for alternatives outside of China. 

Communication

Some of us old-timers can remember when the fastest international communication was Telex. Videoconferencing was just a futuristic novelty 20 years ago. The gains in efficiency and cost reduction from Zoom and its kin have been huge. It's becoming a transformational technology that has positively impacted every part of our business and personal lives.

JPMA's Role

JPMA as an organization has fortunately done a very good job keeping pace with the industry changes. In "the old days," helping members gain retail distribution was the major focus. The annual trade show was a key JPMA benefit and source of organization revenue. Today, JPMA's primary roles include acting as the voice of the industry, assisting members with regulatory and compliance issues, crisis management when the need arises, and responding quickly to individual member needs. 

Keeping Up with Change While Preserving Your Sanity

I used to say that being a CEO was like being strapped to the front of a rapidly moving train having no idea what challenge was waiting for you around the next corner. The being strapped part hasn't changed. However, it's not a train anymore. It's a rocket ship! You can be sure the next 20 years will bring even more disruptions to the status quo than the past 20. Just think about the potential impact of robotics, machine learning, body sensors, self-driving cars, genetic engineering, digital currency, and geopolitical changes to name a few driving forces.

If future changes will be fast and furious, how do you survive and prosper in a rapidly changing environment? There's some useful guidance you can take from the Taoist philosophy of "going with the flow." It starts with accepting the fact that change is natural and inevitable. Therefore, the best thing you can do is not resist change but instead equip your company to be a rapid reactor. That means being aware of the "flow" and adapting to it quickly - continuously. That means:

• Constantly monitoring the environment to identify threats and opportunities as soon as the first signs appear. Subscribing to relevant news feeds and newsletters. Keeping an eye on direct and indirect competitors. Adopting lifelong learning as a personal and organizational priority.
  
• Creating a "light on your feet" culture in your company that embraces both continuous incremental improvement and the need for periodic transformational change. An example of an incremental improvement would be improving sales forecasting accuracy. A transformational change would be moving from subcontracting to in-house manufacturing, going from retail distribution to direct-to-consumer, or entering a totally new market.
• Being willing and able to access expertise in areas with which you are unfamiliar. At the same time, learning enough about new methods and technologies yourself so that you can oversee the work. Don't be afraid to learn from your competitors and other industries.
• Testing and experimenting with new processes and strategies continually to be on the cutting edge while avoiding dangerous financial risks.

Bottom line is that the companies that succeed in the future will likely be the ones that have made rapid response to change a core competency. 

As always, if you’d like more information or assistance regarding achieving your business and life goals or you just want someone to brainstorm, vent, or commiserate with, consider taking advantage of JPMA’s Executive Mentor Program by scheduling a Zoom, Skype, or Face Time session with me. I’d enjoy meeting you and helping you any way I can. Check the JPMA web site for more information or contact Reta Adler at radler@jpma.org.

Ron Sidman was the founder and CEO of The First Years, Inc. and former Vice Chairman of the JPMA Board of Directors. He is currently a business consulting resource for JPMA members and serves on the Advisory Boards of both the School of Entrepreneurship and the Dean of the College of Education at Florida Gulf Coast University. Ron is also the President of Evolutionary Success, LLC, a life and business coaching company.