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An anecdote to back up your claim: I recently reached out to Crate & Barrel and Pottery Barn about furniture orders, and their (U.S.-based) supply chains are backed up for 3-4 months and counting. There are some things we’re willing to wait for, but some that as a result of these delays, we are ordering some things from Wayfair. It’ll be interesting to see what they try to do to hold onto customers once supply chains become a less critical differentiator between retailers.

On April 30, 2020, tf commented on Airbnb: To be, or not to be :

Thanks for sharing this! You provided some great ideas for steps that Airbnb can take to try and recover beyond COVID; in particular, I really liked the safety statistics idea, since as a guest I end up spending a ton of time tying to piece together a view of how safe a property’s location is.

I do think there is one more step they need to take: shoring up support among hosts. I fear that this experience will drive a lot of hosts off the platform, either out of necessity (their property goes into foreclosure because they can’t make their mortgage payments), fear (the uncertainties / risks associated with being an Airbnb host now seem too high), or frustration (they’re annoyed by the cancellation policies that Airbnb has forced into place). Maybe the relief fund that you mentioned is sufficient, but I feel like money is only part of the solution and there also need to be some higher-touch, highly-empathetic communication to hosts.

Thanks for this interesting post! I’d bet that we see a lot of retailers trying to supplement their businesses with digital connection and, ideally for them, revenue streams.

I found it especially interesting that you pointed out the fact that Nike has a substantial presence in China and therefore was forced to confront the pandemic from the onset. It’s interesting to think how the earliest-impacted by these sorts of crises are also those who have the first opportunity to innovate, experiment, and potentially “win”. Nike obviously has a lot of resources to draw upon, but I can’t help but think that their early experiences is China gave them a potential advantage among U.S. retailers!

On April 30, 2020, tf commented on “Zoom by Day, Houseparty by Night” :

Any hypotheses as to why some of the “legacy” players (e.g., FaceTime, Zoom, Skype) haven’t integrated more HouseParty-esque features?

On one hand I could see it being too difficult to accomplish, especially as they all scramble to address more fundamental issues such as security; on the other, it’s just truly shocking to me that we haven’t seen even a little bit of innovation to make these tools more group-socialization friendly when it seems so obviously proven!

On April 30, 2020, tf commented on Haus Apéritifs: The Restaurant Project :

Where do you think digital innovation has been most helpful for Haus? My sense would be that a restaurant could get its own ecommerce platform spooled up if it wanted to – especially now that Toast Tab and other platforms are making themselves (freely) available – so perhaps the big value-add is in the supply chain and distribution management…but honestly have no idea.

On April 21, 2020, TFD commented on Stitch Fix: Your Personal Shopper :

Totally feel the same about preferring to pay less and forego the human touch. I have a hard time believing that the presence of a human in every transaction is necessary from a QA or algorithm improvement standpoint – so I wonder if it just exists to give customers peace of mind at this point, and Stitchfix believes it is necessary to convert customers?

On April 21, 2020, TFD commented on Duolingo – Learning the language of AI :

Thanks for sharing this – Duolingo is such a cool product, and this post explored me to product features I wasn’t yet aware of!

I’m sometimes surprised by the new languages that Duolingo is able to launch; my expectation would have been that it would be hard to take many of the learnings from one language model and transition it to the next, and therefore the new language units, until they generate enough of their “own” student data, could deliver experiences sub-par to what people have come to expect from what they have experienced in the more established Duolingon modules. However, the Lemonade insurance protagonist said that there are actually a lot of NLP learnings that can transfer from one language to the next (in reference to using the models they had trained on English for German- and Dutch-speaking customers), so I wonder if Duolingo is using similar models and technology to get a jump-start on training new modules!

Do you think that Sana has a sustainable future as a standalone business? My concern here would be that a big insurer such as BCBS, Aetna, etc. could undertake similar processes and do an even better job than Sana, since they have so much more historic customer and claim data on which to train their models – in which case, is there a point at which Sana should position itself for acquisition by one of these insurers?

On April 21, 2020, TFD commented on The Next Rembrandt :

This reminds me a bit of chemists who are trying to recreate historically significant wines in a lab. I question whether experiments like this, or the wine, actually create any value for consumers. As you said, it can create value for the firm by increasing brand equity, but unless the process of creating these products is resulting in learnings that allow the firm to meaningfully improve the goods and services it is actually delivering to consumers, it seems like a (very impressive and fun) vanity project and little else.

On April 21, 2020, TFD commented on (Z)estimating iBuying opportunities for Zillow :

Hi there!

Yes, I believe you are right that this cuts out the real estate agent. That definitely creates a risk that real estate agents stop posting their other listings on Zillow in retaliation, but I wonder if Zillow feels this isn’t a concern because they are already at such a huge scale that to forego posting on Zillow would be too detrimental to the agent.

The more I think about it, I realize that Zillow’s core business, even without the Instant Offer, effectively disintemediates the real estate agent to some extent. The fact that we can now go online to find properties, message the owners, schedule a showing, etc. without help from an agent probably also frustrated the agents when it first came out – and yet, they’ve tolerated it, and even participated. So perhaps that is a sign that the value Zillow creates for the agents and brokers is sufficiently great that they’re willing to tolerate some competition – similar to the paintball gun retailer who was willing to keep working with Amazon even though they “stole” some of his suppliers.

Thanks for highlighting all of these Airbnb projects – super interesting, and fun to think about ways that this could improve the experience for guests as well as hosts!

I see the need to help hosts better understand the trustworthiness of guests, and the potential to use the messages to help do so. My one concern would be that Airbnb has, by definition, guests from so many different backgrounds – nationalities, native languages, travel style, etc. and I’d suspect you are going to have to deduce trustworthiness a bit differently from each. Is NLP technology at a point where you can train a model that works on such a diverse pool of users? Then again, are human beings really capable of assessing trustworthiness without letting some of their biases come into play? I could see this creating problems, but I could also see this solving them!

Totally agree re: huge disintermediation risk! For the most part these are repeat, high-value services that are happening within local clusters – the same risks apply as they did to Handy (example from RC TEM) and countless other home cleaning / beauty service / pet care / childcare / etc. But these platforms keep getting funded, even after we see them failing time and again! I’d love to hear if anyone has theories as to why that is, and if they see any way for a platform like Beaver to solve the disintermediation problem.

I actually think that HBS also uses a third-party OPM (online program manager) – this is a huge industry and standard practice, so it’s kind of notable that Coursera is instead so insistent on co-branding. It’s obviously working for them now but I wonder to what extent, and if a time will come when they start white-labeling their tech (if they aren’t already).

On March 24, 2020, TFD commented on Coursera: The Edtech platform that could disrupt Higher Education :

Harvard actually think that HBS also uses a third-party OPM (online program manager) – this is a huge industry and it’s kind of interesting that Coursera doesn’t seem to be playing in that space more.

I’m also skeptical of the breadth of Coursera’s potential – yes, some of the value to a higher educational experience comes from the classroom learning that Coursera is able to replicate, but much of the value comes from things far less replicable: the interpersonal skills developed among classmates, the relationships with fellow alumni, etc. These intangible sources of value are impossible to replicate even if Coursera were to serve as an OPM for admit-only programs (e.g., students still have to go through a rigorous application process).

Given this, I’d put my money on Coursera disrupting vocational training and continuing education, where the value is perceived to lie in the classroom experience – but not higher educational as a whole. The $399 subscription model doesn’t make much sense here – in fact, it’s questionable whether it even makes sense to be charging to student, in all situations, or whether Coursera should be focusing more on B2B opportunities in the continuing ed and corporate training markets.

I am similarly bearish. Masterclass subscribers are by and large going to confine themselves to just a couple verticals, and they probably aren’t going to rewatch much of the content, so there is a heavy burden on Masterclass to continue to innovate with new content if they want to retain customers – and because of the distinct production style, they have to take on the entire creative and financial burden themselves.

This is very different from Netflix, which typically doesn’t bear the end-to-end costs and risks of content creation, and can choose to buy / not buy content based upon what they believe is in-demand; critically, Netflix content also lends itself to being rewatched. Netflix has it much easier than Masterclass, and we see how hard things have been for Netflix during periods of its history.

As a result, I don’t really see the subscription model working out for Masterclass. I think a year or two from now we will see their subscription numbers plummet as people opt not to review because they have maxxed out on the content that is interesting to them. The only way around that is huge, continued capital outlay by Masterclass to continue creating original content, and there will come a point when it is no longer possible to finance that kind of investment.

On March 24, 2020, TFD commented on OpenTable: Restaurant Reservations Made-Easy :

An alternative to the no-show fee that hbs51369394 mentioned is the approach taken by Tock, in which customers pay up-front – sometimes for an entire prix fixe meal, and sometimes just a deposit that is then applied to the check total. This seems to potentially create more value for the restaurant since it provides them with up-front cash and completely insures them from cancellations and no-shows – but do you think it’s a threat to OpenTable’s model?

On February 11, 2020, TFD commented on Pandora Media – from winner to loser – and back? :

When laid out like this, it seems so obvious that Pandora would lose against Spotify, Apple Music, etc. Any hypotheses or knowledge on why they have remained so committed to an outdated, non-competitive business model for so long?

Do you think Sephora’s strategy is to use these tools to push more customers online / onto mobile, or to pull more customers into stores?

On February 11, 2020, TFD commented on Fitbit: Weathering the Storm? :

Any thoughts on how specifically Fitbit could have innovated to retain more relevance with consumers?

Any insight into how Allbirds has approached new product development (i.e., has it been heavily creative-driven, or more market-/data-driven)?

Amazon is also what convinced me to finally try grocery delivery! As you pointed out, last-mile delivery of grocery does have some unique complexities that are especially high-stakes; if my Amazon package is delivered to OWA instead of SFP 6, it’s annoying but I get over it, whereas if that happens to my Whole Foods order, it’s likely going to be ruined and I’m going to request a refund. At the same time, consumers perceive Amazon as being the experts in last-mile delivery, so they have high expectations. It’s a tough spot for Amazon to be in!

Given the criticality of the last-mile delivery, I find it interesting that Amazon has used independent contractors for so much of their Prime Now grocery deliveries, as they are inherently limited in their ability to train these workers. Competitors (i.e., Instacart) have reclassified delivery drivers as employees which could suggest that there may be good reason for Amazon to also consider a similar reclassification. I’d be curious if you have any thoughts on why Amazon has proceeded the way they have? And why / why not you think it would be a good idea for Amazon to take more control over their last-mile grocery delivery?