Competing vs Enabling

In recent years, eBay and Amazon are competing with one another more and more. As consumers, we experience the two online marketplaces quite differently. EBay is the place to hunt for a deal in an auction format, while Amazon is the site of choice for a hassle-free transaction. When John Donahoe joined eBay in 2008 as CEO, the company was struggling. EBay had stagnated. However, they have since engineered a major turnaround. EBay has reinvented itself away from the auction-based personal marketplace that made them famous. Instead, eBay is flourishing with a newfound emphasis on mobile retail and payments (PayPal).

One specific aspect of eBay’s strategy caught my eye. Unlike Amazon, who competes directly with traditional retailers, eBay is partnering with physical retailers, using their mobile platforms to help bring brands online. Traditional retailers are looking at eBay as a partner and at Amazon as a threat. This strategy fits with eBay’s history, as eBay has always been more about enabling individual sellers and facilitating transactions than developing eBay as an independent retailer.

With all their dominance and success, it is hard to doubt Amazon’s strategy. However, with <10% of worldwide consumer spending occurring online, there remains an enormous amount of value in aiding physical retail brands, rather than attacking them.

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This was inspired by a NYTimes Article.

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Interesting? 

Olympic Sponsorships: Taking Advantage of Users (When Will They Learn?)

When Will They Learn?

The most basic fact of the Internet Age: everyone has a voice. Hence, when you screw someone over, they publicize about it.

One such occurrence happened quite recently at the Olympics. One of the major sponsors of the Olympic games is Visa. Evidently, the sponsorship agreement included an exclusivity clause for all olympic venues.

You could only use a visa card at Olympic Venues.

When Will They Learn?

The world is transparent now. EVERYONE has instant access to information. The way to get attain good publicity for your company/brand is not to limit your patrons (or force them into acquiring your service, like those attending the games w/out a visa card). The route to more users of your service is to EMPOWER THEM. Create a service so great that you don’t have to force it on anyone. Create a product so great that users sing its praises and brag about it to their friends.

All this exclusivity move did was embitter people towards Visa, especially those who beforehand did not have a Visa card. What convenience did the exclusivity add for patrons? What problem did it solve?

Don’t force consumers to use your service. Make it so great that they want to use it. That’s the future. Especially in the hyper-competitive world of payments.

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Staggered Release Dates

Picture this. You are a fan of the Temper Trap. A big fan. Big enough that you were planning to PURCHASE their new album.  You live in the US. Their new album (self titled) was released in Australia on May 19th. But, the US release date isn’t until June 5th. What are you going to do? Wait for the US release, or simply torrent it, as the album is readily available online due to people in Australia uploading it.

I understand that there are contractual label obligations behind such a decision. But, all staggered international release dates do is hurt the artist financially. If a fan is loyal and rabid enough that they were planning to purchase the album, it means the fan is probably dying to hear the finished product. A few days is one thing, but releasing an album in a major territory weeks after the initial release is foolish, for many of those loyal fans will be impatient and will download the album illegally.

 

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Mobile Add Ons

I love the concept and execution of Square. A free, convenient, physical add-on to smartphones that provides a mobile payment SOLUTION FOR CONSUMERS.  The true genius of Square is that consumers can attain it for free. The reason for this is that as a mobile payment solution, Square inc. can (and does) simply charge a percentage off the transactions they process. By doing this, they have removed the barrier of an initial payment for their service.

So slick. So great. SOLVE A PROBLEM AND THE PUBLIC WILL EMBRACE

This leads to the question: what other physical add-ons are coming for smartphones? And, will they too be able to come up with the alternative business model required for free distribution of the physical product?

A Quick Analytics Anecdote…Facebook Optimized Advertising

There has been a lot made lately of Facebook’s shortcomings in terms of its status as a lackluster advertising platform (read this! The Facebook Fallacy). However, it wasn’t until the other day when I realized how much better Facebook could utilize the troves of data they have access to.  Here’s what went down…

My good friend just returned from the Birthright program. Essentially, Birthright is an all expenses paid, 10 day trip to Israel for American Jewish youth (age 18-25). This program exists in the hopes that seeing Israel firsthand will foster further generations of Israel-supporting, American Jews.

Anyway, my friend returns, and right away (as they did not have access to Internet while abroad) gets on Facebook to find 40 friend requests from his other trip participants. They are also uploading and tagging each other in many photos. He had an amazing time, and apparently everyone returned from the trip with a significant newfound pride in the state of Israel.

Some Newfound Pride in Israel

It is completely reasonable for Facebook’s infrastructure to recognize these new relationships and what they have in common: a recent trip to Israel. That pride is what SHOULD be capitalized on. If FB’s advertising platform was advanced as it could be, all of the kids on this trip would be getting targeted ads pertaining to Israeli “pride” products. Israeli flags, Naot (a popular brand of israeli sandals), and all sorts of other items could fly off virtual shelves if given the opportunity.

Experiential data is extremely valuable, as it plays to people’s emotions. Facebook should orient its advertising platform accordingly.

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