Where does growth come from?

I received a YouTube video link via an email forwarded across multiple mailing lists praising its insight. It was Clay Christensen’s talk at Google titled “Where does growth come from?” I’ve read and seen many of Clay’s talks now and feel a certain familiarity with the material. However, I am a fan. In fact, I¬†think it is a normal week on ALearningaDay when at least one post is directly or indirectly inspired by one of Stephen Covey, Clay Christensen, or Seth Godin. ūüôā

I thought I’d boil it down to the usual 3 things I took away. But, before doing that, let’s lay the groundwork. First, we must understand that companies invest in 4 kinds of innovations to drive growth –
1. Potential products: We don’t yet know what they are.
2. Sustaining innovations: These make the potential products better.
3. Disruptive innovations: These grow markets.
4. Efficiency innovations: These enable us to do existing things faster or better.

Getting terminology right is helpful in learning how to use them. I found this helpful as I found myself grasping this better despite having seen this a few times.

1. Disruptive innovations originate at the low end and are often business model innovations. For example, Uber disrupted the taxi industry with a business model built on variable costs. The iPhone disrupted the personal computer. And, so on. An interesting point he made was that disruptors often win with customers who were non consumers. Uber converted car owners into Uber users. And, his belief is that Android and Huawei are disrupting the iPhone on the low end. They are, in turn,¬†bringing in non computer and non iPhone users into the smartphone market. Japan’s growth in the 1970s came from a series of disruptive innovations. They enabled non consumers to own cars, listen to music and consume electronics. However, they followed it up by focusing on increasing profits and efficiency/sustaining innovations. And, these only help with growth in the short run.

I thought of Amazon and Jeff Bezos as¬†he insisted on the importance of the low end. Amazon Web Services or AWS struck me as a great example of this –¬†a combination of low end and a fundamentally different business model of charging by usage has resulted in their stunning growth. So, the question that crossed my mind was – how do you ever disrupt an Amazon?¬†Thanks to Jeff Bezos, they are so relentlessly focused on the low end that it is highly unlikely a competitor will ever catch them unawares.

2. The customer is the wrong unit of measurement. Forget the customer. Instead, focus on the job the customer hires you to do. This is such a simple and transformative idea. Yet, I haven’t completely internalized this and, thus, can’t say I have learned this yet. I need to keep working on applying this regularly and make it second nature.

3. Be careful what you measure. A Clay talk wouldn’t be complete without this message. The metrics we use can have many an unintended consequence – both at work and our lives. The metrics that are commonplace – stock prices, valuations, promotions and salaries – all tend to be short term. The most valuable things are the hardest to measure. So, take the time to understand¬†how you will measure your business and your life.

A close friend watched this talk and pointed to¬†Clay’s humility as one of the things that impacted him. Whenever someone asked a question, Clay always said – “Thank you for your question.” And, his presentation reeked of humility and thoughtfulness.

It doesn’t at all surprise me that Clay gets that right.¬†After all, the small things are the big things. And, there are few who “get” that idea the way he does.

[embedyt] http://www.youtube.com/watch?v=rHdS_4GsKmg%5B/embedyt%5D

OMTM for German publishers

OMTM stands for “one metric that matters.” Understanding the OMTM for a business is incredibly helpful in analyzing the impact of an initiative.

A collection of German publishers came together recently to create a pooled data set to help improve their ad targeting capabilities to be able to better compete against Facebook and Google. The CEO of the new¬†platform had this to say –¬†‚ÄúNobody is suffering more than publishers and sales houses in Germany, because they don‚Äôt have enough data, and their data silos will never be able to aggregate enough to come even close to Google and Facebook,‚ÄĚ said Daniel Neuhaus, CEO of Emetriq. ‚ÄúEven now we‚Äôre pooling it; we‚Äôre still nowhere near but we‚Äôre getting closer in quality and quantity of data.‚ÄĚ

He definitely deserves points for honesty. While I think this initiative makes 100% sense, I doubt it’ll do much to move the needle. And, it is easy to understand why when you understand “OMTM.” The OMTM for advertising is audience attention. The more time the audience spends on a platform, the better the advertising potential. The amount of time users spend on Facebook and its properties is only increasing. Couple this engagement¬†with the increase in the number of daily active users on these properties and you begin to see why Facebook is being touted the killer of journalist business models. Google, on the other hand, benefits from being the perfect spot for direct ads as these depend on intent. If a user is searching for car dealerships in their town, it is likely they’re shopping for a car. In both these cases, the key is audience¬†attention. Data helps. But, it¬†is just the by product of a good product.

So, what should publishers do to really compete? Get better. Provide better, sticky content that will drive German consumers to their websites and have them stay longer. They need the sort of content that will encourage their audience to by-pass Google and Facebook and show up directly. Do that and the pooled data set will pay dividends. Else, it will just be a case of too little, too late.

Image Source

Data for trash

I’m hoping we are 10 years away from when you dump your trash into various trash cans for different purposes (recycling, compost, etc.) and wait to get your trash rating.

data for trashImage Source

The trash rating would come from scanners in these cans which¬†can detect if you did the right¬†thing. For example, they’d be able to tell if the compost level went down from 100% to 98% and, with data on the change of weight, the approximate amount of¬†non-compost material you dumped.¬†You would have scanned in your home’s card or ID number to get to the trash room. So, bad garbage dumping¬†would have an effect on¬†your overall trash adherence rating.

The¬†trash adherence rating wouldn’t be all that different from a credit rating. In this world, it would have 2 important consequences –
1. Your adherence rating would be known when you file for a job and when you apply to buy/rent a house. Employers and house owners would want to keep their average adherence ratings down.
Why? Glad you asked..
2. A poor adherence rating would mean higher taxes. The rationale is straightforward Рthe poorer your adherence rating, the more work for garbage collectors and sorters and the worse the externalities for society. To make sure the tax incidence is progressive, we could target a part of the funds into lower income households while ensuring incidence is much higher on higher income folks.

Given what we know about our human penchant for not acting till we absolutely have to, maybe the linkage of our trash¬†data and taxes are a bit far fetched. Hopefully, the rest isn’t though. I’d love to see home data for trash and energy use, for example. Just seeing the data and being able to compare our usage with local/global averages could go a long way in reducing pollution and energy waste.

The Apple Pay moment

I¬†took a quick look at¬†tickets for Kung Fu Panda 3 a few days ago¬†on my laptop. As soon as I found them, I did something that I’d never done – I pulled out¬†my phone, opened the Fandango app, found the movie and paid via Apple Pay (i.e. by just placing my thumb on the home button).

I generally make sure I do my online shopping on my laptop. I find it much easier to type in card details on my keyboard vs. on the phone. And, in most cases, there are plenty of auto fill options that make the process faster.

But, every time I’ve used Apple Pay on my phone, I have loved it. It just makes me feel good as I think of all the typing I’ve just avoided. And, even if my last experience buying tickets was a good 6 weeks back, I still remember the feeling.

This was definitely one of those moments when I noticed my behavior as a user, paused for a moment to observe myself and then said – “Wow!”

Apple Pay hasn’t taken off yet. But, I’m long on its prospects. It removes friction – and that’s what great products do.

Apple PaySource

Thinking Product: Economist Espresso magic

The Economist Espresso is a new digital product released by The Economist this year. The Espresso is a collection of¬†6 key pieces of news, a collection of smaller news bytes as part of “The world in brief” and a collection of market specific metrics.

The jobs to be done framework developed by Clay Chistensen explains that customers “hire” products to get a job done (More here). When I think of the job that readers of “The Economist” hire it to do, I think there are 2 kinds of jobs it is hired to do –
Use case 1 – “Make me smarter” ¬†(majority)
Use case 2 – “Prevent me from looking stupid”
I think use case 1 is the majority because it is rare to come across environments where everyone reads and discusses “The Economist.” I’m sure there are isolated cases of teams where the manager is a huge fan and insists on discussing it with the team. But, for the most part, The Economist is akin to a “vitamin” rather than a “painkiller.”

However, newspapers / news apps exist largely for use case 2. Very few people ready the news to make them smarter. It is, after all, more of the same every single day – disaster and negativity coupled with a few bright spots. And, I suspect most people hire newspapers to prevent them from looking stupid when their colleagues or clients discuss the news.

That’s what makes The Economist Espresso a masterstroke. The Economist is now solving use case 2 by promising well curated news. The Espresso is helped greatly by The Economist’s stellar brand – we expect thoughtful, quality content and is a fantastic example of a brand extension. Even if The Economist refers to itself as a newspaper, it is generally a collection of weekly opinions and analysis. With Espresso, The Economist plays in the news domain and actually exists as a painkiller for use case 2.

The Espresso requires you to subscribe to the Digital edition for $22 per quarter.¬†This means $1.83 per week to get smart news news 6 days a week? Absolutely. And, I would also get to read the top 10 odd articles, Editor’s picks and a couple of “round up” articles from The Economist as a bonus? This is fantastic. The presence of a painkiller completely changes the game.

the economist espresso

The Economist, then, follows it up with a beautifully designed app that is just a pleasure to read. I get “The Economist Espresso” by email and consume 3 other emails in the morning – TheSkimm, The Quartz newsletter and Ben Thompson’s “Stratechery” daily update. However, I always find myself archiving the Espresso email and heading over to the app because it is so pleasing to the eye. Even advertisements look gorgeous – so much so that I ignore the fact that I see an ad every day despite the fact that I’m paying for it. I think the maximum word count on an “agenda” item (there are 5 of these) is 150 words – just right for a quick skim. And, the world in brief pieces (7-8 of these) are no more than 75 words.

The only small¬†nits I noted –
РIt does feel more intuitive to swipe downward and go to the next article rather than swipe left
– The email edition ends with a quote – I can’t find it on the app
– The Espresso recently added a Saturday edition with news on the arts and sports. I, for one, always hope to find more sports coverage. Here’s hoping that changes going forward.

Overall, a fantastic experience thanks a smart combination of thoughtful product strategy and excellent execution.

Thinking Product: Amazon Kindle Support awesomeness

I kept up¬†a product review series for about 9 weeks over the summer before talking myself out of it. I felt I was putting too much pressure on myself and decided to give it a break. As the weeks have passed, I am ready to get back to it. My passion for discussing products and services hasn’t changed. I am still keen to learn how to build great products. And, that means learning how to “see” greatness in products. A part of what made the old series hard to continue was that the “product review” framework felt constraining. So, I’ve decided to keep it more open. Let’s see how v2.0 goes.

The¬†product experience I’d like to discuss today is one with¬†Amazon Kindle support.

One of my recent learning objectives is to get good at Statistics.¬†I was recommended a Statistics textbook by one of my Professors and purchased it on Kindle. I didn’t get to it until Thanksgiving break. When I did, I soon realized that it wasn’t conducive to reading on the Kindle (app on my iPad) because it inspired me to take notes, try out exercises and flip pages to see the answers. I needed to get a physical copy.

This, book, however, was $94 on the Kindle. And, while I’m normally indifferent to education related spending, I felt guilty about making a bad decision and began researching Kindle returns.¬†It turns out that all you have to do is go to “Manage Your Content and Devices,” click on the book and (here’s the catch), if the book was purchased in the past week, you can return it with a click.

Amazon returns

Mine was 2 months old and I’d also read a bit of it on the Kindle. However, I decided to give Amazon’s Kindle support a shot. Here are the emails.


Hi,

I am a graduate school student who purchased Statistics (Fourth Edition) on my Kindle. However, upon reading it, I’ve found it very hard to “study” this book on the Kindle and purchased a physical copy instead (just purchased a 2nd hand version on Amazon).

I know this is a long shot.. but I was wondering if I would qualify for a return. This would be particularly valuable to me as this is an expensive book ($94!) and I am, after all, a cash starved graduate student.

Thank you for considering this.
Rohan


Their response came through in less than 2 hours.


 

Hello,

I’ve requested a refund of $93.32 for “Statistics (Fourth Edition).” Refunds are issued to the payment method used to make the original purchase and usually complete within two to three business days.

Once processed, you’ll be able to see the refund request here:

http://www.amazon.com/gp/digital/your-account/order-summary.html?orderID=D01-9350573-87…

Thanks for using Kindle.

We’d appreciate your feedback. Please use the links below to tell us about your experience today.

Best regards,
Shruti S

Did I solve your problem?
Yes No
Your feedback is helping us build Earth’s Most Customer-Centric Company.


 

3 quick notes –

1. I was blown away by the speed of response. As a friend pointed out, this means they likely¬†have authority at the customer support level to make such decisions. A $94 for a book bought 2 months ago isn’t a small decision by any means.

2. My only improvement suggestion would be to add the name of the customer next to the name. “Hello Rohan” would have been fantastic. Audible support does a fantastic job doing that.

3. “Your feedback is helping us build Earth’s Most Customer-Centric Company.” – In most cases, I would scoff when I see a line like that. It is testament of the consistent awesomeness of all things Amazon that scoffing didn’t even occur to me.

Great product experiences mean making sure your users get supported. Thanks, Amazon, for showing us how its done.

PhraseExpress – Product Review 6

Attribute #1. Delivers on a singular value proposition in a world-class way (purpose): Grade ‚Äď A+
PhraseExpress exists to make it easy for you to replace oft-used phrases with a couple of keystrokes. I use it to replace phrases that I use a lot – e.g. “please find attached,” “hope you are doing well,” “looking forward to,” “alearningaday,” my email address, etc.

It saves me a ton of time and has never caused problems. Definite A+

Attribute #2. Simple, intuitive, and anticipates needs (design): Grade ‚Äď B
I don’t find PhraseExpress’ design to be simple or intuitive.¬†3 areas where it just over complicates things –
1. Clicking the icon on my taskbar doesn’t open the application. It opens a bunch of sub menus. I need to right click -> Edit phrases to open up the application.
2. Right clicking the left hand side of the image above (i.e. where the phrases are stored) gives rise to 5 options – to create a new folder/phrase/bitmap/counter variable/separator. Maybe PhraseExpress’ users are largely power users who understand what all of this means. But, I somehow doubt it. It feels a lot like feature creep.
3. The right hand side is, again, anything but simple. I would scrap this and start all over again to make things simpler.

The only place where PhraseExpress scores high is that it notices spelling errors wherever I type and helps auto correct. But, thanks to bad design, this is only a B.

Attribute #3. Exceeds expectations (customer love): Grade ‚Äď B
It does what it is supposed to. Solid B here.

Attribute #4. Emotionally resonates (feel): Grade ‚ÄstC
No emotional resonance. I don’t find that to be disappointing as I don’t expect any better.

However, the product keeps popping up with these massive alerts asking me to upgrade to their latest version. Now, I’m really glad their product team is shipping all these upgrades. But, it is text expansion software for god’s sake. I wish there was an easy way to turn the updates off. Sadly, I haven’t found any. And, as a result,¬†the annoying updates cause negative emotional resonance.

Attribute #5. Changes the user‚Äôs life for the better (impact): Grade ‚Äď A
Definitely positive impact.

Overall Rating: B
PhraseExpress is an example of a product that delivers on its purpose well but fails on the user interface. It feels like a classic case of feature creep with way more options than necessary.

But, that said, I still use it and I’d still recommend it. And, I think that speaks to¬†the power of a product delivering on a single value proposition in a world class¬†way.