Very interesting topic! Since almost every firm across different industries will be affected by digital transformation, I wonder if the organizational structure of the firm should change. Rather than having a “Digital McKinsey” function within the firm, it might be more effective if these digital capabilities and experts are absorbed into the existing industry and function groups. As VR and AR capabilities become more widespread for example, the difference between the physical and digital world will also diminish. Therefore, having digital capabilities within all of McKinsey’s functions across industries may actually be more reflective of the state of reality that the clients are in. Of course, this is not easy, as both you and Saurav have pointed out the potential cultural resistance within the firm and differences in talent and personalities between the digital experts and management consultants. However, I think this integration is necessary if McKinsey needs to prove its expertise in the digital space. Not only do they need to show that they can help clients’ through their digital transformation, they also need to transform themselves into a digitally savvy organization. This means that the incentive structure and work culture might have to change across the entire organization in order to promote collaboration between the digital and non-digital teams. Instead of having separate KPIs, it might make sense for McKinsey to have the same KPIs and promote cross-functional training so that consultants become more knowledgeable in the digital space while the data scientists and computer programmers become more aware of the business implications of the digital implementations.
Very interesting to see how Disney’s streaming services will play out. While the Company is best fit to compete with Netflix and Hulu, there is a first-mover advantage. As JZ has mentioned, Netflix, Hulu, and Amazon have invested billions of dollars on original content, which have helped them acquire and retain new customers customers. Furthermore, Netflix has also invested in children’s content as a way to keep parents on its platform, which can make Disney’s value proposition less unique for many customers. Disney also needs to think about potentially expanding into R-rated content, as their existing focus may limit their customer growth. However, I do think there is significant opportunity for Disney to incorporate real-time events, such as sports events from ESPN, onto its streaming platform. This will put Disney a significant edge over its competitors and allow its customers to access a different type of content and experience that other online competitors are not able to offer.
Awesome topic! I agree with the comments above around a subscription type service, especially as Nespresso improves its IoT capabilities. In addition to providing seamless capsule delivery for customers, the company can also use the data collected from Prodigio to help maintain the machine and prevent the machines from malfunctioning. This type of constant customer and machine monitoring will also require changes on the business side, as customer service functions will become increasingly important. The Company will need to train its existing employees on how to analyze customer data and remotely diagnose problems with the machines in order to provide the best services for its clients. It’ll be interesting to see if the Company has thought about these challenges, and whether or not they are prepared to handle potential changes in their business model and organizational structure.
I agree that customer awareness and education are certainly some of the most important drivers that would help expedite user adoption in IoT-related products. Proving out the value of these products can be very challenging, as it requires not only high quality sensors and data analytics to show to the customers, but also extensive “hand-holding” to ensure that customers are using the products the right way. Only through excessive use of these products will the users be able to realize their value (e.g., energy savings, increased home security etc.). Therefore, it is also important for Nest and Google to think about how to expand their customer service and training capabilities to help users maximize the value of these smart home products.
Awesome to see that traditional businesses in the restaurant industry are starting to use data analytics to optimize their performance. I totally agree with your point around competition. Data collection and analytics, if implemented in the right way, can be a huge competitive edge. Since it is considerably easier for large companies to collect customer data and hire the right analytical talent, I wonder if this will cause a further divide between these big chain restaurants and mom and pop establishments, making it even harder for smaller restaurants to compete.
Interesting article! I think the Company definitely has an advantage over traditional e-commerce sites given the mass amount of data that they have on the customers. However, I wonder how effective they are at helping customers discover new outfits and fashion styles. As a previous Stitch Fix customer, I liked the fact that they were able to pick out the outfits that fit me perfectly, but over time, I found that all of their recommendations seem to be of things in the similar style. This was probably driven mainly by their algorithm, as they learned what type of clothing I liked best. Unfortunately, this exact same value prop was also the reason why I stopped using them as I got bored of the repetitive styles. I wonder if there are things that Stitch Fix could do to encourage users to venture outside of their comfort zones without compromising their core value proposition.
Very interesting model! It sounds almost like Quora for medical experts. I’m actually curious about the viability of the subscription service. For example, what is to prevent a patient from dropping out of the platform once the doctors have diagnosed their problems? It’s also interesting to think about the moral implications of segmenting the quality of the doctors by how much the patient is able to pay. I think this pricing works great for other markets, but just seems a little “icky” in this situation. However, I do think that this is a great platform for younger, inexperienced doctors to “practice” by learning how to diagnose real life situations. It would be extremely helpful if learnings can be disseminated from each solved patient case so that other doctors can learn and improve. This can then be another source of revenue, which are hospitals or medical schools who want to better train their doctors in a cost effective way.
Very interesting model. I wonder which part of the company’s success is due to the crowdsourcing part (sharing with 9 other connections) and which is due to the fact that they provide more transparency to the platform and cash back for users. I can see instances where the crowdsource aspect can actually be a detriment due to privacy concerns as users might know which of their friends are making the expensive claims, and that can lead to potential animosity. Would the company be less or more success for example, if they actually removed this aspect of their model but kept everything else?
Great blog! It’s very smart of company to leverage the influencers to help them promote and design their products. As the beauty industry is particularly opaque compare to other industries, is is especially important for Glossier to build up their brand, which they have done successfully thus far using influencers as a marketing tool. However, my concern is whether or not this model is sustainable. Are the network of influencers effective in strengthening Glossier’s brand or is the brand a temporary fad? Does the company have any protection against these influencers eventually leaving the platform when the next trendy, beauty product comes into the market?
This reminds me of my little cousin who is absolutely in love with this app! What I am curious about is its source of revenue stream. It seems that it’s “gift program” is not a very stable source of revenue for the Company. Are the users required to purchase these coins? Or are there incentives that encourage people to buy these virtual gifts for others? I think it’s important for Musical.ly to bring in other partners onto this platform as a way to not only diversify its business, but also strengthen its network effect by creating more value for a different segment of the market. For example, I can see Musical.ly partnering with movie studios or gaming companies to develop capabilities that would allow its users to participate and reenact memorable scenes from movies/games and use “virtual props”, different voice effects, and theme songs. These exclusive partnerships will help differentiate the app from other competitors and will also boost its advertising revenue so that it is not solely dependent on its users.
Very interesting post, and certainly highlights a difficult problem that many of these dating apps are facing: how to differentiate itself in a highly competitive, multi-homing-type environment. The lack of physical interaction on the app often encourages people to make very swift judgement from short descriptors and profile pictures. While our generation has certainly become more comfortable with digital dating platforms, I think it’s important to bring in elements of face-to-face interaction as a major source of differentiation. The League could potentially organize social events for selected individuals on the platform based on common interests and backgrounds, and this will allow people to interact with multiple people in a comfortable environment. These events could be “invite only”, which would offer a sense of exclusivity, and the League could find these social events as an additional way to monetize the platform. Another reason why social events are important is that this will help build a sense of community, as users will see others as people with multiple dimensions and interests rather than profile pages. Having these unique experiences for users would also help strengthen its platform and stickiness.
Great post! I agree with some of the comments earlier that partnerships with automakers might make it more attractive for car owners themselves, as systems would be more integrated and drivers could perhaps earn special “perks” if they charge their cars in designated places. Another way to diversify its business lines and protect itself from commoditization is perhaps investing in building better car batteries or partner with other battery makers. This could significantly improve the time that people would have to wait to charge the cars as they could just swap out their car drained battery packs for new ones at a one-time cost, or subscription-based model.
It’s remarkable to see how far LEGO has evolved over the years, and I can’t imagine how difficult it must’ve been for an established company to go through such a transformation. I agree that LEGO’s IP is definitely one of the most valuable assets Company has, and there are definitely ample opportunities for LEGO to capitalize on its name and popularity. LEGO should continue to create more digital content through movies and games. In addition, they could also create short-form content and distribute through Youtube or Netflix, platforms where children’s content are in high demand. Rather than solely relying on its name, I think it’s important for LEGO to expand its IP portfolio through building original movies and characters so that the company could move away from being just a toy company to a original content creator.
Very interesting and worrisome, especially as someone who loves going to the movie theaters! I think the comment made earlier about MoviePass is definitely promising, and it does help remove some of the initial pain points for many people. It’ll also be interesting to see the responses from movie studios and whether or not these theaters would eventually lose their bargaining power against companies like Netflix and Amazon. One way to remain competitive for AMC is to potentially partner up with movie studios to create new forms of movie content and experiences that only a movie theater could offer.
Definitely agree that Comcast is well-diversified and that its HSI business has helped offset some of the losses in the broadcasting business. I think a huge opportunity for Comcast NBCU lies in digital advertising, which is seen through their investments in Snap, Buzzfeed, and Vox (which you have already pointed out). In addition, there is a lot of value that can be extracted from the merger of the two businesses, especially in programmatic advertising. Comcast could now track users across not only its digital content platforms through NBCU but also “offline” through its cable channel. This user data and information could be extremely valuable for advertisers that are looking to target the right segment of users at the right time. For example, Comcast is currently working with Rubicon Project that would allow advertisers to buy “inventory” on its Xfinity.com. So I could see this as a huge opportunity for Comcast to fully leverage its two major businesses and create new and advanced forms of digital advertising capabilities.