PCs can do what? Is the question being asked in a new campaign being run by Intel, Microsoft, Lenovo and Dell.
Judging from the reaction to the companies’ effort whatever PCs can do, it’s unlikely to help their at best stagnant market share.
Tag: marketing
Amazon and the customer focus
The old model of seeing your customer as being a milk cow is dying. Today’s business needs a lot more focus on treating the customer with respect.
I’m currently attending the Amazon Web Service Re:Invent conference in Las Vegas.
One of the constant themes in writings about Amazon is founder Jeff Bezos’ focus on delivering the best service and cheapest prices to the customer, even if it does sometimes rely on some less savoury tactics to chase out smaller competitors.
That ethos is on show at this convention with AWS Senior Vice President, Andy Jassy saying at the post opening keynote press conference, “our strategy is to be customer focused, not only do all of our strategies and tactics work backwards from what our customers want but ninety percent of our roadmap is driven by what customers tell us matters to them.”
He did however fall for the temptation of dissing some of his competitors in the IT market saying, “most technology companies, particularly old guard companies, have lost their will and the DNA to invent. They acquire most of their invention that’s expensive and it really doesn’t fit that well together.”
“We’re extremely long term orientated,” Jassy continued. “We don’t call you on the last day of the quarter and say ‘boy, have we got a deal for you’. You won’t see us auditing our customers and fining them. We’re trying to build relationships with our customers that will outlast everyone in this room.”
Jassy’s points are pertinent to the current business world, the old model of seeing your customer as being a milk cow – something the older software companies were terribly guilty of – is dying. The future needs a lot more focus on treating the customer with respect.
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Rethinking customer service in the connected age
Businesses would be wise to stop telling people what they should want and let customers tell them what want says Shel Israel in his book Lethal Generosity.
Businesses would be wise to stop telling people what they should want and let customers tell them what want says Shel Israel in his latest book, Lethal Generosity.
In this book, Israel’s previous works include Naked Conversations and Age of Context which were both written in collaboration with Robert Scoble, he looks at the technological and social changes affecting business and how they can adapt to a rapidly evolving marketplace.
Key to that evolving marketplace is the explosion of data offering businesses deep insight into their customers. as Scoble describes in Lethal Generosity’s introduction in talking about social analytics service Vintank;
VinTank was acquired by a big PR agency that wants VinTank to do for all sorts of industries what it has done for the wine industry. Are you a restaurant or a winery ignoring that data? Go ahead and keep doing that for a decade. Your competition won’t.
Israel illustrates the need to watch the marketplace in citing a campaign where Canadian brewer Molsons completely wrong footed an oblivious competitor, something similar to how one bank discovered a rival’s successful marketing campaign through real time bank deposits data described at the recent Splunk conference.
Focusing on the customers
A customer centric outlook, not looking at competitors but focusing on what consumers want is key to success in the new economy, Israel believes. This is enhanced by technologies that allow both products and marketing to be personalised as shown in the chapter detailing how retailers and airports are using beacons and data analytics in their operations.
One good example is AirBnB, while Israel trots out the ‘biggest hotel chain’ in the world fallacy that’s pervasive among commentators, its effects on the established industry has been profound and have forced hospitality operators around the world to re-evaluate their business models.
Israel suggests the best response for businesses affected by the ‘Uberization’ of their industries is to adopt the social and analytic tools and strategies being used the upstart businesses and he provides a wealth of examples.
Seamless sales
Tapingo, the food ordering service for US college students, illustrates the seamless experience that consumers are increasingly demanding in their shopping, business and leisure activities. Israel cites how Tapingo’s merchant partners are seeing an in-store traffic boost of 7 percent and a gross profit rise of 11 percent as a result of using the service.
Shel also illustrates some of the failures in deploying new technologies, specifically London’s Regent Street Alliance that failed due to poor execution and a failure to engage the marketplace.
One of the weakness in the book – which Israel acknowledges – is its focus on US, and specifically Bay Area, case studies. While there are some non-North American examples such as Australia’s Telstra and China’s Alipay, most of the examples cited are of companies based in or around San Francisco and Silicon Valley.
Focus on Millennials
Another weakness of the book is the over-focus on Millennials or Digital Natives. While this group is important that obsession risks Israel’s message being pigeonholed amongst the noise of poorly thought out pop demographics and poor analysis that marks much of the discussion around changing tastes and habits between generations.
Israel’s point that the post 1982 generation will soon outnumber older cohorts in both the workforce and the marketplace in the near future though is an important aspect for businesses to keep in mind with the safe certainties and predictable customer behaviour of the baby boom era being long gone.
However the shift in consumer and workplace behaviour is just as pronounced among all the post World War II generations as technology and the economy evolves in the early 21st Century. Focusing on the younger groups risks missing similar shifts among older members of the community.
The value of customer service
Ultimately though, Israel’s message is about customer service. Shel himself flags this is not new, in describing the competition between hiking goods suppliers The North Face and Sierra Designs in 1970s Berkeley.
What is different between today’s businesses and those of forty years ago is technology now allows companies to deeply understand their customers and provide customised marketing, products and experiences to the connected consumer.
For the business owner, manager or entrepreneur, Lethal Generosity is a good starting point to understand the forces changing today’s marketplace. The case studies alone are worth considering for how an organisation can adapt to a rapidly evolving world with radically shifting customer behaviour.
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Dealing with an app driven world
The challenge of dealing with a app driven, mobile workforce isn’t just one for technology companies.
“It isn’t easy to create apps for the real world,” is the opening line of this morning’s VM World conference in San Francisco.
That line encapsulates the challenge facing almost every company, not just tech companies like VMWare, in the face of shifting marketplaces and technologies.
One of the biggest business shifts is the move to mobile technologies. This isn’t just changing marketing and user experiences but also changing companies’ operations as staff increasingly use their own smartphones and tablets to work.
Managing a shifting market
That shift though is not simple, as ZD Net reports Facebook’s move to ‘mobile first’ was a tough path in the words of the company’s senior engineer Adam Wolff.
“I think everyone would say it was worth it, but it was extremely painful,” Wolff admitted, explaining each sub-team was building in their own ways because there was no one to crossover with necessary knowledge.
Facebook has probably been the most successful company is dealing with the mobile shift and their difficulties despite their massive resources show just how difficult it is for companies to change not just their technology, but their business processes and in many cases the entire mindset of the organisation.
Those pain points in transitioning between ways of doing business is where opportunities lie, for VMWare they are seeing IT departments struggling with the development and deployment of apps along with the security risks of staff bringing their own mobile devices.
Happy coincidences
For VMWare, this is a happy coincidence in that their main business of computer virtualisation is as much at risk from the shift to cloud computing and mobile applications as any other business. By offering the tools for companies to manage that shift, they can retain their place in the market.
The threat though is this space has many other contenders – not least Facebook itself with its open source React platform the company developed out of its experiences in developing its mobile product.
One of the strengths VMWare has is being an incumbent, which is why they are pushing their ‘hybrid cloud’ offerings where companies use both their own data centres along with the public cloud providers such as Amazon and Microsoft.
Stuck with sunk costs
For large corporates with huge sunk costs in their own infrastructure and those with security or operational reasons for keeping some of their functions in house that hybrid strategy makes sense as it’s unlikely any board or CIO is going to happily burn their existing systems and process down and go to a ‘pure cloud’ or mobile strategy.
While catering to that market is lucrative for the moment, the longer term risk is that the next wave of large corporations – and today’s high growth businesses – are pure cloud companies.
For the companies catering to the old ways of doing business, for the short term there’s profits to be made in the pain points from an evolving marketplace but in the long term it’s how well businesses are placed for the world the end of that transition that will guarantee their survival.
The process facing software companies like VMWin dealing with as business shifts is a challenge faced by almost all industries, the question is how to adapt to a very changed way of working.
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Marketing and the Internet of Things
We’re only just beginning to understand the marketing potential of the Internet of Things says Bosch’s Jim Fish
“There is no perfect product,” says Jim Fish, “but the Internet of Things makes it possible to deliver a close to perfect message.”
Fish, the Chief Innovation Officer & VP Global Automotive Diagnostics at Bosch North America, was speaking to Decoding the New Economy ahead of his visit to Sydney to speak at the 2015 ADMA Global Forum.
For marketers, the connected car and the Internet of Things presents a unique set of opportunities, particularly when overlaid with today’s social media tools.
“If you think about your ability to message with today’s Facebook and the ability for marketers to micro-target messages so you could push a message to people according to things they’ve shown preference for or things that they have liked.”
“The next leap frog ahead from an automotive perspective is in vehicle advertising specific to vehicle and location,” says Fish. “There is a battle for the real estate in vehicle’s infotainment systems. The automakers are placing a lot of effort in delivering the experience the mobile user desires.”
In the auto industry this has seen a battle between software vendors to stake a position on the smartcar’s dashboard. Fish sees Google with its mapping, search and advertising technologies as being the best placed in that field but doesn’t think there will be one single winner in the automobile space.
Smart Connected Living
One of the biggest opportunities beyond marketi Fish sees is in combining the smarthome with the connected car. “We see this exploding,” he says of Bosch’s future plans. “We see it as perfectly integrating,”
Fish sees how the connected home integrates with other technologies to provide seamless connectivity for people. Even if people lose their smartphones the smart house will be able to inform and communicate with them.
Again, combining the information gathered by social media and other services presents opportunities for businesses and governments.
Networking the smart city
For the smart city, Fish sees connected cars providing a key part in managing and planning the towns of the future citing how the Michigan Department of Transportation sees how equipping vehicles with road monitoring sensors could save the state 11 million dollars a year in inspection costs.
Fish also cites how cities are experimenting with monitoring how taxis and public vehicles are using their windshield wipers to determine weather conditions. The US Department of Transportation flags the smartcar as the mobile weather station.
Again Fish sees Google as having an advantage in applying these technologies with their acquisition of Israeli traffic crowdsourcing service Wayze.
“Crowdsourcing is in its infancy. There are many things computers can do but there are some things they will never be able to do. There are some human elements still required.”
Fish sees much of our understanding of what we can do with the internet of things and the data we generate from it as being in its infancy. The real value lies in extracting the value from it. For marketers the journey is only just beginning.
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The Chinese sock fallacy
“We have an addressable market of four hundred million dollars a year. It’s a huge opportunity and we could win half of it.”
The business manager speaking – who we’ll call John – was talking about the potential market for his company’s small business product that promises to earn around two hundred dollars a year.
How John came to the four hundred million dollar number was simple. He multiplied the two hundred dollars by the two million small businesses in Australia.
John had fallen for the ‘Chinese sock fallacy’ where a simplistic assumption creates the illusion of a huge market. The idea being that there are a billion people in China all of whom will own five pairs of socks so therefore there’s demand for five billion pairs of socks.
The key part of the fallacy is not knowing whether those billion Chinese or two million Aussie small businesses want your socks or cloud computing services.
Other complications include who are the incumbents currently selling to that market, how many pairs of socks do most Chinese people own, how often do they replace them and what do they pay for a new set?
Suddenly things get complex and the assumptions don’t look so promising as we find with John’s projection of his market.
Looking at the figures for Australia’s small business sector with 61 percent of enterprises having no employees, it’s hard not to conclude most are contractors or consultants who mostly don’t need John’s cloud service.
So the Chinese sock fallacy strikes again.
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Are brands doomed?
A few days ago we covered the Great Transition research paper by Colonial First State Funds Management’s James White and Stephen Halmarick and followed up with a piece in Business Spectator looking at the ramifications for the Australian economy.
One of Halmarick and White’s assertions is that brands are dead as consumers in emerging economies don’t care about corporate names and in developed nations people have better information about local businesses.
The former argument seems flawed from the beginning; Apple for example is making huge inroads in China while local manufacturers like Lenovo, Huawei, Great Wall and Haier are all working hard to establish their names in international markets.
In developed markets, White and Halmarick’s views have more basis with brand names not having the cachet they once did now consumers have a global platform to voice complaints and find alternatives.
A good example of brands that are struggling are companies like Microsoft and McDonalds, although in the case of both companies this could be more because of a shift in the marketplace rather than better informed consumers.
However brands are surviving as they lift their game and adapt to changed marketplaces, in fact its possible to argue that today’s consumers are more responsive to brand names than ever in the past.
A good example of this is again Apple which has more fans than ever before. Apple are also a good example of how big corporations can invest huge amounts into new technologies and products to give them an advantage over upstarts.
We should also remember that brands as we currently know them are largely a Twentieth Century phenomenon born out of the development of mass media communications and many of today’s household names came into the culture thanks to television in the 1950s and 60s.
So as creatures of last century’s media it’s not surprising that brands are having to evolve to a changed world, some of them will thrive and grow while others will shrivel away.
It’s safe to say though that the concept of brands isn’t dead, although many of the names we know today may not exist by the end of the decade.