Wow – go Delta! And yet, flying is still such a painful customer experience. I appreciate the baggage tracking, and I understand how they’re using data to better market to customers (makes sense to lock in consultants’ loyalty on Delta early!), but I’m curious how they could use more customer data to improve the actual flying experience – the way Virgin America has. This is a good reminder that a company can sometimes get too narrowly focused on data (and the data they have: access to purchasing history, etc. rather than the data they should use: customer surveys on satisfaction, for instance) and forget about delighting the customer. For instance, can they find data that would help them load or unload the plane more efficiently?!
Interesting! I love the idea of being able to better track available parking spots – it seems like such an outdated challenge we face every time we park. However, I wonder how scalable this approach is. How does the technology in the parking spot actually work? Does it track spaces via satellite? Or through the meter? Does the 2% increase in parking revenue make up for the cost of installing this technology? I also wonder how much the prices have to vary to incentivize someone to park further away. For instance, if I could pay 25 cents more to park one block closer, I probably would, but for $1 more, maybe I wouldn’t? Interesting consumer behavior implications that I’m sure they could test as well.
Cool idea! But I completely agree that it’s way too cumbersome for anyone to actually use at this point. What if they made an app that you installed on the tire of your car that automatically tracked your trips and sent road issues to the city? It doesn’t make sense to have the app on your phone for this sort of solution. But interesting idea to incentivize people with a tax break or point system. The tough part of this is there is no clear value-add for the users (unlike Waze – which shows people faster ways to drive, so they use the app and report traffic, etc.) – there is the long term benefit of improved roads, but that won’t remind me to employ the app each time I drive through Boston.
Great point Staff – it works if the cost to manufacture is low enough (and essentially the design cost is $0 assuming the crowdsourced designs don’t need to be modified). But they started with suits with reflective gear – material I’m assuming is more expensive than cotton t-shirts and more difficult to manufacture. I think the partnership with the video game company is a good move – they need to find a bought-in customer base with a high likelihood of actually purchasing the crowdsourced designs that they can’t find elsewhere. Again though, it all depends on the manufacturing costs to determine sustainability.
Interesting! I didn’t realize Minted gave more weight to previous purchasers. I think this could be a good way to weed out the infrequent users, but I don’t think high purchase volume is necessarily a good indicator of superior design sense. Instead, they could have the artists whose designs get purchased more frequently count for more votes? It will be interesting to see if they can get in to the home decor space as easily – what works with printing is the fact that the digital image looks exactly like the printed version (allowing them to not test products or stock inventory), but I’m not sure that will be the same for hard goods.
Interesting! Sounds like they started out as a platform but saw more value capture potential by getting in to the actual real estate agent market. I wonder if hiring full-time agents is a long-term play, a defensive play (to differentiate from Zillow), or a necessary play to increase the number of listings / sales on their site. I mentioned this in my Zillow comment, but I’m not surprised to see that they’re using user-interface to compete – for a market like this (where multi-homing is really high) they have to find a way to get users to use their site over others.
Sara – this is such a great, clear example of both direct and indirect network effects! What’s tricky in this market is the high degree of multi-homing: a real estate agent can easily post a listing to a number of different websites that offer this same service, and buyers will likely search multiple websites as they’re considering a home purchase. So you make a good point that they need to increase customer stickiness or the only way they will be able to win is continuing to acquire all of their competitors (e.g., Trulia for $2.5B in February) which can get expensive! One way websites like this reduce multi-homing is by charging a membership fee to view data or post listings, but that might reduce the indirect network effects since there would be less activity on the site. I also wonder how much they are spending on user interface, which seems to be one predominate way these marketplaces compete for user engagement.
This is a great example of a company sticking to its core competency (physical products) but also acknowledging that they need to keep up with the demand for software / technology embedded in their products, so outsourcing it to people who do that best. I’m not concerned about Nike not being the source of innovation going forward (to SEA8’s point), because it sounds like the multi-homing factor is low for products developed on the Nike platform. So effectively, once a product is developed, it’s seen as a Nike product, thus a Nike innovation. Nike also has the huge advantage of a large existing user base, so by building this new technology that is only available with Nike products, Nike is increasing the network effects. I think Nike is well-positioned to win with this strategy.
Hmmm… interesting idea. A few concerns though: is their proprietary software actually better than someone else could build? I don’t mean AirBnB would build this themselves, but is the market defensible against other software companies? It seems like a simple idea at this point that others could replicated and sell at a lower price point. Unless the user interface is actually that much better, or if they’ve already signed up a large enough customer base… I also wonder what businesses would never sign up for this. Would a doctor’s office? Would a therapist’s office? Would If a computer greets you at the door, does it change the experience of entering a business, or will everyone eventually prefer a robot or iPad to ease their check in and send them in the right direction? Given the growth of fully automated businesses (even for food preparation! see: https://www.eatsa.com/), maybe that is the direction we’re going… Finally, I’m assuming this model would still require a security guard, and maybe someone on call to repair the interface when it glitches, so I wonder what the actual cost savings are. But you’re right, the added convenience of automatic alerts and the potential to make deliveries easier would be huge value adds!
Very interesting perspective Sara! Spoken like a true business traveler 😉
I wonder, however, how much AirBnB is worried about competing with hotels and how your recommendations would align or not align with the AirBnB brand. One of the reasons I think AirBnB has been so successful is because they started by targeting a different type of consumer: someone who was looking for a unique, local experience as opposed to a standard hotel chain. If they adopted your recommendations, the rooms might as well be owned by a real estate property investment company and standardized appropriately, a business model that one of our classmates is trying to implement in Southern California. If AirBnB were to adopt some of your recommendations (and I believe regular hosts could adopt some of them to increase their ratings), I might suggest they open a different platform that caters to business travelers as opposed to vacation travelers as to not confuse the value proposition of the brand today. However, speaking of platforms – I would consider AirBnB a HUGE winner in this space because they have effectively acquired the hosts and travelers they need to make the business successful without facing much competition along the way.
Interesting point Rishek! Unfortunately for DSC, the razor is a complete commodity, so could easily be displaced by Dorco as the low-cost generic equivalent. However, why do people still by Tide when there are so many generic cleansers on the market? Because of a brand connection? Because they grew up with it? It seems like DSC is trying to create an ego-expressive purchase with their marketing which will make men want to support the business because they like the story it tells about them, rather than seeking a lower cost alternative on Amazon. It’s a great model – I would love if they expanded with a women’s line, but I wonder how it would change the brand / marketing / appeal to men.