The phrase “late stage hyper-capitalism”, referring to our global economy that is characterized by increasing globalisation, the dominance of multinational corporations, mass consumerism, and a growing commodification of virtually every aspect of life, is hard to miss these days.
But while the casual observer may believe brands are big winners, natural survivors of our survival of the fittest world, a closer observation reveals many of today’s biggest brands are actually more like collateral damage, or fodder for the ruthless hyper-capitalism machine.
When even “old money” luxury brand houses, like LVMH (down 9% from last year) are shedding shareholder value and market share the very idea of brand, by definition, “a type of product made by a particular company and sold under a particular name” as a competitive moat, is called into question.
The whole point of a brand is monopoly over some intellectual property – and the resulting ability to extract more value from the market than a generic alternative.
This is a wonderful game to be in, on the winners side of late stage capitalism, as long as you can persuade people to pay you more in exchange for the intangible “status” your brand confers. It was a playbook that worked very well in the not so late stages of late stage capitalism, where we saw brands extracting market power from suppliers and retailers who, without a strong brand of their own, could only sell cheaper generic products.
But now, with the twin horsemen of globalisation and automation now well in our midst, brand power is very much under threat.
The deadly combination of:
1) Free generative AI tools like Seedance (owned by ByteDance who also owns TikTok and the lion’s share of the attention economy) that allows anyone (even those of us with zero artistic talent) to realise (or just copy-paste-edit-bastardise you brand IP) any consumer good their heart desires in high fidelity resolution
2) Big -no enormous – tech platforms that not only own attention and digital foot traffic at scale in a way even the world’s biggest real world retail chains like Walmart could only dream of – and allow consumers to create, edit, share and remix generative products, creating, following and destroying trends in real time – the places where creators have more taste making and purchase power influence than kings and presidents,
3) International, on-demand supply chains, already tested and perfected by SHEIN and Temu, that allow super-factories in the East to spot social trends in real time, copy paste generative AI vision boards into fully functional manufacturing and logistics systems that convert consumer hyper-realistic hallucinations into blueprints, and blueprints into goods, shipped right to that customers door faster than you can even arrange a board meeting to approve a production line.
Are all merging to squeeze the last drops of profits (and disaster loot the left overs of IP) from brands.
Welcome to “late stage hyperbrand” where even the world’s biggest brands, like Disney, have NO CONTROL over consumer generated AI knock offs – or even direct from social platform idea – through factory – to consumer real life distorted, personalised dupes. Where every player in that supply chain -from the platform who takes a translation fee, to the tax men and tariffs that charge their tolls, to the factories who make the goods to the end consumers who cash in on ripping off your brand IP for their personal social credit – except for you, the brand owner make money off your IP.
What space is there for a brand in a world where no IP is globally defensible, a world where consumers wrest control from crafted brand IDs and foreign supply chains can make your own goods better, faster, cheaper than you can?
Can you compete on speed? Customisation? Price? No. Quality? Perhaps. But let’s forget the viral videos of Chinese factory owners showing luxury goods shoppers the very factories where their idolised branded bags and shoes are made, and offering to sell those self-same goods off the back of the line direct-to-consumer for the ex-brand markup price…. Nor how loud and proud young shoppers are of finding and sharing dupes. Getting a deal, screwing over a big brand is nothing to be ashamed of – oh no – these days it’s to your social credit to get one over The Man.
No. What brands need to accept is that both brand as monopoly, brand as control, and brand as homogeny are highly endangered business models. Instead, the future of brands will be brands who willingly share control with customers – think open source IRL. Brands who relinquish mass market – and the online visibility that comes with it – for smaller offline “secret societies” who value story over conspicuous consumption and keep “their” (for you will have to share here too) brand status secrets safe. Brands who give up the idea of brand altogether and focus on actual product invention and manufacture. Brands who cut out all the middle men and own and control their own hyper-fast, hyper flexible supply chains from start to finish.
In short – if you can’t beat them, share with them.
Or – play another game and give up scale for small and sustainable.
May the odds be in your favor.
