Christy – love the idea! I did a quick search of both Lowe’s and Wayfair’s websites and it looks like the greatest overlap is in Patio Furniture and general decor items. Lowe’s features decor and accessories on its website but does not appear to actually sell furniture items like couches and chairs – if Wayfair was willing to be a supplement for Lowe’s missing items, I think they could form a great partnership. The challenge will be as you said, the question of whether competing items become a challenge. I expect if Lowe’s saw a reduction in the online purchase of such accessories or decor items without a gain in other areas, they would be less excited/willing to continue a partnership long term. Definitely an interesting proposition though!
Oyku – interesting proposition! I think one of the values of having Lowe’s Holoroom technology located in the Brick & Mortar stores currently is that a customer service representative is able to assist the customer as he/she builds their dream room. If Lowe’s was able to successfully partner with a VR Headset manufacturer for at home use of the technology, they would need to ensure the experience was as easy as possible to design the room without a customer service representative – otherwise I think the technology would receive negative reviews very quickly and would lose a lot of the appeal it has built thus far in the stores. This is definitely a challenge they will need to tackle if they want to stay relevant when VR grows in their target customer segments.
Yezi – thank you for your comment! I completely agree that the 13-17 year old is not Lowe’s current target demographic. For this reason, all of their current use of VR is actually in the Brick & Mortar stores including the Holoroom and the Holoroom How To. The primary at home innovation is the Lowe’s Vision which utilizes AR technology instead.
Given that clarification, I actually think the biggest hurdle for Lowe’s will be to ensure their target demographic knows about these innovations within the store and attracts customers to use technology that they might otherwise be unfamiliar with. Given the high level of customer service engagement in the DYI space, I would push back on your comment that Lowe’s brand is not associated with high brand engagement or experiential interactions – I just expect that as non home owners, we are currently not the target demographic for Lowe’s brand. That said, I’ll be curious to see what type of marketing I receive whenever I purchase a home in the future and whether Lowe’s does successfully advertise its use of AR/VR technology to make my DYI projects easier.
Thanks for the post – as an Alumna of HBX Core – I find myself very intrigued about the future of HBX and how it will interact with the HBS classroom and value proposition.
I find myself reacting somewhat strongly towards your suggestion of creating a virtual professor and avatars that would fill the classroom and form the discussion. So much of the beauty of HBS’s case based discussion in my opinion comes from students sharing their own personal perspectives and thoughts. I also find the ability for a professor to take the dialogue in multiple directions based on comments/responses made in the classroom a really key skill/talent of the professors at HBS. Yes I know there is a lesson/teaching plan for each case – but I have had a number of classes where the professor has commented on the comments going a different direction than planned and he/she is going to run with it – I love that! I would be really concerned that though the virtual classroom conversation may be filled with digitized versions of some of the best comments made in the past – it actually wouldn’t be a truly interactive experience and might feel somewhat forced. Recognizing that the goal would be to find a fully VR classroom with a live professor and seats filled with real students – do you think HBX could get there soon? Or do you think HBS would even want there to be a totally virtual version of the perfected case discussion experience?
Great post Alice!
I agree with Libby and your comments above – I think it would be beneficial for GoPro to produce a VR camera with a more attractive price point for the consumer. As we read in the industry note – one of the biggest hurdles for VR is consumer adoption. I believe production of a more affordable VR camera would encourage more consumers to create content creating more incentive for others to purchase HMD’s capable of viewing such content. GoPro is facing a bit of a chicken and egg problem here and I believe they have the power/influence to get the content production side of the equation developing to encourage more consumers to engage in VR altogether.
Thank you for such an insightful post! One of your suggestions in the future growth opportunities really struck me – the ability to meet a classroom in another part of the world. I recall participating in a pen pal program when I was in 4th grade and thoroughly loved writing letters back and forth with another 4th grade girl across the US. I found it so interesting to compare our experiences, I can only imagine how incredible an experience it would be to interact virtually with a student of a similar age in another part of the world! This technology could go beyond closing the education gap and could improve awareness of other cultures, reduce stereotypes and discrimination and improve global relations. I know I have been iffy myself on the expansion of online education as it threatens institutions like HBS, but this is the first time I have really come to realize how impactful such education can be to improving global relations. Thanks again!
Steph – thank you for your comment! Given that Tinder’s model is all about maximizing the number of individuals on its app, I do not see a time where it would limit who was able to access the app. Actually, I am seeing the opposite happening in the online dating space in that other apps are opening up. The League for example is now filled with a number of individuals who have no connection whatsoever to an Ivy League school, the original premise of the app. As it opens up further, the League is diluting what it stood for in the first place and just becoming another dating app with little to no differentiation. Tinder’s ability to minimize the number of users would alienate so many that it could never survive such a PR nightmare.
I do believe Tinder will be around in the next 5 years – however I expect there will be consolidation in the industry as more and more apps come out facing more and more competition for members and participants. We’ll have to wait and see if Tinder is an acquirer or is acquired should such consolidation occur.
Libby – thanks for the post. I also took the quiz and received a notice that the size they recommend I purchase was not supported by the True&Co at this time and yet was still presented with 3 bras they thought would be “perfect for me” – I am fairly confused about what the size is that they are labeling me as and why I would still get recommendations if I can’t purchase anything on the site.
I also wanted to hear your thoughts on whether you think True&Co’s questionnaire has actually helped women find better fitting/suitable bras? On a few occasions I have noticed that based on how clothing is falling on a woman, she is wearing a bra that is clearly not the right size/shape for her body. However I am not always convinced that the woman knows she is wearing the wrong bra size. Does True&Co believe that their questions are in investigative enough to get the woman to unknowingly identify that her bra is not the right size? Has there been any research on how many women they believe they have helped to find the right fit? And given that Victoria Secret and other B&M Retailers measure sizes in stores, do you think there is a higher likelihood for VS to be successful in this space over an online retailer measuring you based on your current bra experience?
Thanks for your thoughts!
Great post Yezi! As a future resident of Chicago, I am super excited to see the work being done to make the city cleaner and healthier.
I had a question regarding the Nodes. As I read your post, it seems that the value of each node varies from the bigger picture topics such as air quality and temperature versus much smaller picture topics such as accidents at a specific intersection. How does Chicago plan to balance the spread of its 500 nodes. I know you have mentioned above that this is controversial as Chicago will need to think about locations throughout the city. However did you read anything about whether there is value in placing a number of nodes close to one another to get a true sense of the traffic flow? Or is there value in placing them far apart? Is there anything they are doing to improve the technology to ensure that most issues the node notes will be more universal in truth throughout the city rather than simply sticking to one intersection? Thanks for the post!
Yao – thank you for such an interesting post! I wonder if this use of applied analytics as it pertains to the choice of actors will drastically alter the course of some actors’ careers. Given that an actor gains popularity through the movies in which he/she stars in, I wonder if using applied analytics will ensure that only the best actors/actresses receive parts in the best movies or if there will ever be a time where applied analytics would recommend a completely unexpected actor/actresses that might either add to the movie or take away. I also think of movie stars who have faded away based on a lack of movie opportunities. I’d be curious to know if you have read anything about how this is effecting actors and their ability to land parts with Legendary. Thanks!
Thanks for the question. I unfortunately do not know the coupon conversion. However the NYTimes article seems to infer that it is at least significant enough that Target saw value in continuing such targeted advertising and discounting.
As for discount fatigue, Target’s use of predictive analytics here is to provide coupons and discounts for items that the guest needs and most likely is already planning to purchase. I would argue that that is different than other types of advertising where I am shown an ad for clothing/shoes etc that I do not necessarily need but may want. Additionally, I would reference Meghana’s point above regarding the potential to expand such couponing beyond the pregnancy to include items needed following the birth of the child. This allows Target to continuously coupon for new items that the customer may need which will hopefully reduce discount fatigue.
Christy – thanks for your comment! This is a fascinating proposition. I can completely understand the potential value for a non-competing third party seller to gain access to identified pregnant women.
The only way I can see Target agreeing to such a data sharing program would be if the guest opted in herself. In addition to the PR challenges Target has already faced from recognizing and targeting a pregnant teenager – Target would never sell their guest’s data. Especially given the known consequence that the guest will then be targeted for additional services she did not inquire into.
Chun – thank you for your question! You are correct, Target doesn’t have a loyalty program per se however it does have 3 financial products (Target Debit Card, Target Credit Card, and Target Visa Credit Card) which allows Target to track your purchases. The NYTimes article answers your question well so I am sharing this passage below. Essentially it comes down to creating a “Guest ID Number” which is developed over time through all of the customer’s actions in a Target store. Hope this helps to clarify!
“For decades, Target has collected vast amounts of data on every person who regularly walks into one of its stores. Whenever possible, Target assigns each shopper a unique code — known internally as the Guest ID number — that keeps tabs on everything they buy. “If you use a credit card or a coupon, or fill out a survey, or mail in a refund, or call the customer help line, or open an e-mail we’ve sent you or visit our Web site, we’ll record it and link it to your Guest ID,” Pole said. “We want to know everything we can.”
Also linked to your Guest ID is demographic information like your age, whether you are married and have kids, which part of town you live in, how long it takes you to drive to the store, your estimated salary, whether you’ve moved recently, what credit cards you carry in your wallet and what Web sites you visit. Target can buy data about your ethnicity, job history, the magazines you read, if you’ve ever declared bankruptcy or got divorced, the year you bought (or lost) your house, where you went to college, what kinds of topics you talk about online, whether you prefer certain brands of coffee, paper towels, cereal or applesauce, your political leanings, reading habits, charitable giving and the number of cars you own.”
Meghana – Thank you for your comment! I completely agree that targeting for additional items once the baby has been born is a great way of capturing the additional value. One of the big takeaways I found from reading the New York Times article specifically is that customers have a few moments in their lives where they are willing to change their shopping behaviors and the birth of a child is one of them. This is why predictive analytics identifying which customers are pregnant is so significant – it allows Target to encourage the shift in a customer’s behavior towards purchasing more of their regular basket at Target as Target provides all the items you need throughout your pregnancy. For those who had registered with Target’s baby registry – these customers were already receiving targeted coupons throughout the pregnancy and following the birth of the child as predictive analytics were not necessary here.
Yezi – thank you for your comment. I know exactly what you mean regarding advertising based on past behavior. As I wrote this blog post I saw the exact same advertisement over and over again for the shipping company I had researched the day prior. It was quite ironic to write a post on predictive analytics while being specifically targeted with advertising based on my own previous behavior.
The one pushback I have on your comment is that it assumes that what you are attempting to sell is similar to what I have purchased in the past. Target here is actually trying to use predictive analytics to get you to purchase something entirely new which I think is a fascinating use of the technology. As the final quote says from statistician Pole in the New York Times: “Just wait. We’ll be sending you coupons for things you want before you even know you want them.”
Of course retailers may not always recognize the future unpredictable fashion trends. However, if they can successfully use predictive analytics to boost up their customer base, they will have access to additional data that may help them to at least recognize when such trends are approaching to react to them accordingly.
Thanks for the comment! As I responded to Julia below – I think Target has done a successful job to date of balancing utilizing predictive analytics to maximize advertising to the right targeted consumer while still being innovative on products in store. I completely understand the concern for a future where data pushes just advertising the guaranteed sales – but Target recognizes the extremely competitive nature of the retail environment and knows that if it doesn’t maintain a level of creative innovation it will become obsolete very quickly. For that reason I believe Target will still innovate as well as market those new products and categories to its consumers while also marketing those proven products.
Thanks Julia for your comments! Not sure if you are in CMC – but we discussed this exact issue yesterday in our case on the Whiz Kids – essentially the Ford Motor Company fell into this is exact pit fall where they became so obsessed with the financial metrics and data proof to proceed on an idea that a lot of creativity was missed. What I would say from Target’s perspective here is that the predictive analytics are looking more to understand what the consumer will buy next in order to market/advertise effectively. The buyers however are making decisions on merchandise based on past sales data and understanding upcoming trends – meaning that innovation from a product perspective is still very common.
Ali – thanks for the great post! I’ve actually been toying with the idea of ordering a kit and completing the test myself. Will be sure to “opt in” on the research when I do so.
I have a question regarding the research. You said that success of this method needed 141,000 customers to self-identify as sufferers of depression – does that mean that 23andMe’s research is based on self-identification of a disease? If the research is based on those who self-identified as sufferers of depression, I am concerned about the future of 23andMe’s ability to conduct research in a different way than Douglas Levinson is concerned. My concern is that either people will have misdiagnosed themselves (ie they are not clinically depressed but believe themselves to be without doctor confirmation) OR that they will have labeled themselves as not a sufferer of depression when in deed they clinically are.
Did you find anything in your research that clarified how 23andMe ensures its research isn’t exposed to the error of miss self diagnosis? Thanks for clarifying!
Tyler – really interesting post and idea.
As the primary trip planner for my group of friends, I hear your pain. I find myself searching Lonely Planet, Trip Advisor, Hostelworld and other sites to plan out itineraries when I am looking to visit a new place. It is very time consuming, but on a positive note, I always feel like I know the city when I arrive and I know what I want to do/see.
I wonder if the solution to your pain is the once considered defunct travel agent. I read recently that Travel Agents are seeing a robust comeback. “In the last year, 22 percent of Americans from households earning more than $50,000 booked travel through a travel agent, an increase from 14 percent just three years ago.” And interestingly enough – a significant portion are millennials who are feeling that same pain – tired of having to take the time to comb through al these websites to curate a personal experience.
Of course the question of using a travel agent is who pays – whether the travel agent takes a cut from the company he/she recommends you tour with or that you pay for the curated assortment. As millennials begin to further recognize the value of their time, I wonder if there will be a shift back towards paying for such services as an aggregated personally curated travel package.
Fascinating post Tomo – how disappointing to see an HBS alumna promote such unethical actions in the name of growing a business and profits.
I agree with Meili’s comment – I found myself thinking about Wikipedia as I read your post. Wikipedia has developed a set of devout writers who, despite not being paid, are loyal to constantly writing and updating the site. I wonder if there would have been a way for DeNa to have developed that level of loyalty to the platform through ranking the writers and labeling them as “experts” as their work was reviewed and approved. Of course this requires a level of accountability to the writing on the site (as you have alluded to in your takeaways).
Additionally – I have heard a number of doctors and friends speak against “Web MD” and self diagnosing. As someone who has definitely googled symptoms of such ailments as sinus infections etc, I know how valuable it can be to have a quick check on whether I should be concerned about an illness. However I completely agree with your comments above – there needs to be a sense of accountability and responsibility to the content that is published on the website. Thank you for sharing an example of a time where that responsibility just wasn’t in check – I think it demonstrates how serious each of us needs to take accountability for our future businesses to ensure whatever product/service/resource we provide the world does good rather than potential harm.
Thanks Sonali for the post!
I agree with Ali that I think there is value in having one platform to do a number of jobs. However I feel the lack of reviews or sense of security/promise of quality is what has essentially taken me away from Craigslist. Granted I haven’t had to look for an apartment now for over 5 years but I feel our generation has been trained by Amazon to review consumer feedback and commentary to understand what we are getting into when we pay. It could be Christy’s point that the user experience is so rudimentary that we expect so little from the site, but I think this minimalist attitude towards customer’s needs is why these other platforms are seeing such great success targeting a smaller industry and providing the customer service and support needed to build trust with users.
Lauren – great post! I had not heard of Poshmark before. Really interesting!
Question for you – based on the competition in the marketplace, how do you feel Poshmark fairs in terms of their fees charged? Do you believe the $2.95/20% commission is in line with what the competitor sites are offering. For example I believe Etsy charges about 3-3.5% fee on the sale of an item on their platform – would you ever expect to see sellers from Poshmark moving their entire merchandise to another platform like Etsy? Or is there another lever Poshmark has introduced to make this platform stickier for its buyers and sellers?
Thanks Gary for the post! I completely agree with Tomo on the level of traffic in Jakarta – it is mad!
I appreciate your comments on how Go-Jek is adding features to increase the stickiness of its users, however do you feel there is anything they are actively doing to increase the stickiness of the third party vendors who are adding their services to the platform to attract these users? More specifically is there anything they are doing to minimize the multihoming of their vendors who are selling to the users through the platform? If this business simply requires a few motorbikes and app connection to restaurants etc – it seems fairly simple for a competitor to enter and mimic. Other than ‘bleeding money’ – is there anything Go-Jek can do or is doing to ensure they maintain the market leader position from both a user and vendor side?
Sonali – thank you for your comments!
Just to clarify – Boost and Monthly Subscriptions, in my opinion, do not necessarily target those who are looking for a more serious relationship on Tinder but target those who are looking for the added benefit of features like maximizing the number of times your profile is viewed at your specified time of day (boost) and allowing you to see users in other cities in which you may be visiting soon (unlocked geography setting for Tinder Plus).
As I shared above there are only about 1.5M paid subscribers to date of the about 50M active users of Tinder. I completely agree that Tinder needs to further address its means of capturing value from its users. However I do not see its identity as a casual connector app as its main problem. Instead I think the value will come from further developing features for Tinder Plus or added features like Boost that will capture value from users seeking to make the most of their experience with Tinder.
Daniella – thank you for your comment. I completely agree that I associate Tinder with the “Hot or Not” swiping culture over the long term dating and serious relationship scene. However as one of our classmates has proven – you can find true love on Tinder!
To think about a response, I did a little research online and found that of the admitted causal connections that took place thanks to a dating app, 1/3 have turned into a long-term relationship. Meaning that even if someone is swiping right on Tinder for the casual encounter, there is always the possibility that a more serious connection could come about.
However, Tinder’s About Us page states that “Tinder empowers users around the world to create new connections that otherwise might never have been possible.” Juxtapose that with Match that states “Our mission is simple: to help singles find the kind of relationship they’re looking for…. Every month, we hear from hundreds of success couples from all over the world—sharing love stories, sending invitations to weddings and announcing the births of new babies,” and you start to see that these two companies are pushing a very different agenda. In my opinion, I think Tinder is owning its identity and running with it – pushing a high volume of matches and letting the cards fall as the users choose. If a casual encounter turns into a longer term connection, great! If it does not – keep swiping.
Libby – thanks for the comment! I wonder if Tinder is realizing an added value that retailers are now recognizing through omnichannel. That there are consumers who enjoy having multiple outlets through which to access such platforms they believe in and trust. Obviously a web application adds minor additional value to a mobile platform in terms of features – you still aren’t meeting in person for the first connection, but their might be value in providing another outlet for consumers to access Tinder. I think about Groupme vs What’s App. The fact that Groupme has both a web platform as well as a mobile platform is really handy when you are trying to send out longer messages to your friends. I am frustrated by the fact that What’s App requires me to download an application on my laptop to access the platform rather than simply allowing me a quick sign in on the web. There might be value in providing Tinder users with access to their connections on both their portable mobile app as well as the web for when users are multi tasking at home in front of the TV and want the added value of the larger screen to view photos.
I find this post and the chain of questions fascinating! Thank you Natalie for sharing about HBO Now – I actually had not heard of this service and might have to look into subscribing as I have wanted to start watching Game of Thrones for quite some time but never had the access to it (as I am also not a current cable subscriber).
I find Nupur’s comment regarding OTT an interesting concept. I wonder how this would work. If as a consumer, I am able to choose which cable channels I would like to subscribe to, it would mean that I could lower my cable bill and ensure that the only thing coming through is content I want to see. However if all subscribers are doing this, I wonder if there are consequences that we are not considering – the price to upkeep the networks, the satellites, any remaining cabling that delivers content not on the internet? I recognize that the digitization of everything is upon us, but are there any negative consequences we are not foreseeing when we allow consumers to pick and choose their networks?
Annie – really enjoyed your post! As someone who has visited the Fenway (Regal) Cinema which utilizes the large, comfy chairs to attract viewers, I had not put much thought into the idea that the chairs and thus higher ticket price is an effort to offset the lower volume of visitors. Interesting.
I know your post doesn’t touch on cinemas internationally, but I would be curious to know if you have a thought about the fact that construction of cinemas has been exploding in China in recent years. Do you see this as an attempt for cinemas to counter the loss of revenue in America with that of China? Is this construction potentially already a loss given that move towards technology all over the world? Thanks for your thoughts!
Bipul – great question. To answer, I feel the first question to ask is what is the job to be done for the consumer. (BSSE style). In the articles I have read, Google is certainly given credit for a better search engine than Amazon. However if the consumer is looking for a service that encompasses music, shopping, app connection (uber/food delivery etc) and web information – than I think the fact that Amazon has already successfully integrated themselves into 7,000 different services/applications puts them at a great advantage to Google’s new home system.
I would love to ask the question back to you – given that you are an Alexa/Echo subscriber – is there anything you see the Google Home that you feel Amazon’s Echo is currently missing. If so, is that a technology or service that you think Amazon couldn’t immediately replicate in Echo as well?
Good question Libby. I think the fact that Alexa is already tied to 7,000 unique services and products has shown that they are significantly ahead of the competition in terms of market penetration and access to the consumer. As I said in future challenges, the bigger question is how long will it take for consumers to latch onto the idea of a smart home. However I feel Amazon is certainly on its way to making this more mainstream.