I grew up on the south side of Los Angeles on a street called Texaco Avenue. Texaco Avenue intersects with a more infamous south side street named Compton Avenue on Compton’s east side. So needless to say, the neighborhood I grew up in was a bit sketchy.
One of my favorite memories of growing up in L.A. was when my mom would enroll us in swimming lessons during the summer. I loved watching the older kids with their instructors. How they would tread water for 60 seconds or take one breath and then swim the length of the pool underwater. What I loved the most though was when they would jump off the high dive. I don’t know if it was the height of the board or they way they just jumped off without regard for the height, but as a seven year old boy I knew I had to do it.
So when the day came that I climbed to the top and inched my way out to the end of the board, something strange happened. Psychologists call it “rapid cognition”. It’s when everything around you seems to slow down. The periphery blurs and your senses heighten. My heart felt like it was pounding between my ears. I looked down below me and could see the wind blowing ripples across the surface of the water almost in slow motion. For a moment, it felt as if the world had stopped.
There’s an expression in mathematics that’s used to describe a logistical function. It’s called a Sigmoid Curve. It’s called Sigmoid after the Greek word that means “looks like an s,” because it looks like… an “s.”
Over the years the Sigmoid Curve has been applied to many areas other than mathematics. Businesses use it to predict and plan product cycles. The financial industry has adopted it to navigate economic seasons. Marketers use it to explain why their strategies haven’t taken off yet (jab). It’s become quite useful.
Most people, somewhere in their thinking, have arrived at the conclusion that life is fairly linear. It looks like an x and y axis with a line moving out at a 45 degree angle. One input = one output. Two inputs = two outputs and so on.
Over time we have discovered that’s simply not the case. The Second Law of Thermodynamics states that the universe tends towards entropy or disorder.
The natural state of every system tends towards disorder and chaos.
So we’ve come up with theories along the way that explain why everything is not equal. Chaos Theory is one of those. It says that one does not equal one, but rather one input could equal a quarter of an output and three inputs could equal 18 outputs. The S-Curve comes along and places some logic to these theories.
Business Life Cycle
Here’s how it works in business: The S-Curve begins with a base or buildingphase. A saturation of the market. Growth here isn’t quite linear and it’s slow and hard. It’s adaptation and early adoption. The second phase is a growthphase. It’s hyperbolic and exponential. This is where market share is gained. It’s main stream — “let’s go public.” Next is the maturation of the curve. It has a peak. It’s market dominance, the new industry leader, big business. Following the peak, the curve begins to decline. It cannot support the innovation any longer. Market adjustments and realignments begin eroding sales and profit.
The S-Curve is the story of Apple and Google, the American Economy and the American Automotive Industry. It’s the story of the Greek and Roman Empires. It’s a universal picture of change:
Change brings about growth, increase and profit, but eventually slows, plateaus and declines.
Mastering the S-Curve
There is a genius to the S-Curve that works like this: The secret to constant growth is to start a new curve before the first plateaus.
Somewhat counterintuitive, and right before the peak, you have to make a decision to leave the first cycle; to jump. If you wait too long, you lose momentum and it requires more energy, effort, money and resources to change. It’s counterintuitive because the signals toward the top of the curve are good. “We’re growing. It’s exciting. Everything is good. Why mess this up.”
Now a second curve has begun. The second curve is a new product or innovation. A new pricing model or operations system. A new team member or leadership restructure. This new curve will actually dip below the crest of the first and create this hollow space that I technically call — “funky land.” It’s a strange place and can cause lots of confusion and uncertainty. You’ve left what’s working to take a chance on what you see is the future.
At the end of the day, the beauty of this new curve is that it will eventually surpass the height of the first. Sales increase, profits grow, business expands and real momentum happens when you can begin to sling a bunch of s-curves together.
The s-curve is a great tool for marketing as well. Let’s break it down into three parts that I think are the most valuable:
- Evaluate — The start of any s-curve strategy always begins with evaluation and analysis. Here are a few questions to answer:
- Are you happy with your growth in 2016?
- Were you happy with your marketing plan in 2016? Did it perform as you expected?
- What needs to change to meet your expectations in 2017?
2. Big S-Curves vs. Little S-Curves — Sometimes drastic change is needed (Big S), but sometimes it’s just little incremental changes that keep the momentum going (Little S). Knowing the difference is vital.
If you’ve never really done any marketing before, you need a Big S-Curve change. You just need to make your way up the high dive and jump. Have someone follow and push you off if necessary.
If you spend half or more of your marketing budget on traditional media (print, mail, radio, television, billboard), you’re going to need a Big S-Curve soon. You’ve been quietly watching others make their way up the stairs and jumping. I know it’s intimidating, but I suggest you do it sooner rather than later.
If you have a solid marketing plan in place that’s doing well, you may just need to tweak the areas that aren’t performing as well and add some freshness. Which leads me to:
3. Experiment — Every marketing budget should have some experimental funds in it for this exact reason. Introduce something different into your marketing each year to mix it up and keep it fresh. Start a new movers campaign to the neighborhoods around your practice or business. Create an Instagram account. Use Facebook pixels. Increase your Yelp reviews. Test and watch. Who knows, that s-curve could take off.
I‘ll bet we can look back through our lives and see lots of s-curves. Places where we’ve experienced growth and things were exciting, but we can also look back and see where it began to plateau and even decline. Some of these were probably intentional, but I’ll bet the large majority were unintentional.
The secret is in creating a series of intentional S-Curves. Where you have enough foresight to see over the peak of the curve and decide that a change is necessary.
I was asked a great question once: “Do you want the rest of your life to be exactly like the last six months? If the answer is yes, congratulations. If the answer is no…”
I think we all have moments where we are standing on the edge. Standing on the edge of a high dive. Standing on the edge of opportunity. Standing on the edge of change. With our heart pounding and senses intensified, we’re looking over the edge and wondering…
My advice to you: “Jump!”