Category Archives: Business Case

UNISOUND


Chinese Speech Recognition Company focused on Natural Language Processing

Introduction

Unisound Information Technology Co. Ltd. also called Unisound or Yunzhisheng in Chinese is a speech recognition and artificial intelligence company based in Beijing. Current applications of its algorithms include smart medical plans, smart home solutions and intelligent car solutions (Unisound, 2019).

The company was founded in 2012 by Huang Wei, its current CEO, and made recent news by being described worth over $1 billion dollar, which makes it one of China’s unicorns (Yelin et al. 2018). The company states that its vision is to “make the future enjoyable” and it sees the technology industry moving from “device-centric” to “user-centric” and “data-centric”.

Business Model

Next to its endeavors in the industrial production, medical, mobility and teaching sector; one of Unisound’s core products is “UniHome”. UniHome offers its users IoT for apartments and houses including voice-controlled devices, intelligent execution decisions and sound source localization.

To build these services and the required products, Unisound focuses most of its resources on recruiting the best talent, strategically selecting production & marketing locations and collaborating with various top-notch partners. Partners include Lenovo, Intel Qualcomm and Huawei. Next to leveraging its own resources, Unisound extensively leverages the knowledge of external developer by allowing them to create programs for its IoT platforms and devices. Unisound provides open source developer tools and guidance on its website (Unisound, 2019).

What differentiates Unisound from its competitors is its proprietary and patented voice recognition chip. It allows programs to accurately and quickly understand semantics, connect is with a user profile and synthesis text to speech.

While the company’s core product is a solution for the business-to-consumer segment, most of Unisound’s customers, if counted in groups, are business-to-business customers. Its education solutions are sold to schools, its medical solutions are sold to hospitals and its car solutions to car manufacturers and original equipment manufacturers (Unisound, 2019). While it is not explicitly stated on their website, it can be assumed that it tries to maintain strong customer relationships with large business customers and keep start-ups and scale-ups that soon might opt for expanding their solution by voice control, at arm’s length.

The company’s revenue was estimated to be 13 million Euro, i.e. 100 million yuan, in 2018 (Yelin, 2018). Costs are expected to have exceeded the 13 million Euro revenue as the company invested a lot in R&D. However, over time costs are expected to settle at around 80% of revenue (Damodoran, 2018).

Customer Involvement

While, to the best of my knowledge, Unisound is not planning to involve customers for feeding its voice recognition systems for instance, the company’s open source developer tools can be seen as crowd-sourcing customer knowledge (Olson, 2013). Moreover, data collected, showing when and how users engage with the voice recognition and AI systems can be used. While many aspects, such as the specifics of what is said to whom and when may not be used for analytics, other parts of customer data can be used to further improve the products and services.

Literature on crowd sourcing

Blohm et al. (2018), finds 4 archetypes of crowd sourcing of which Unisound can be awarded to the “open collaboration” type. It invites contributors to team up to jointly solve complex problems that require input of many contributors. By providing extensive documentation, multiple software downloads such as SDK and helping developers to manage their applications, Unisound assures quality and regulates the use of the open source platform as suggested by Blohm et al. (2018). However, neither does the company provide incentives to developers nor does it provide support through coaching, tutorials or on-boarding. Blohm et al. also recommends to market the solutions as crowd-sourced, which Unisound does.

Moreover, Nishikawa et al. (2017) find that companies which market their product as crowd-sourced will have increased market performance. Their experiment finds that the performance can go up by 20%. Unisound does emphasize their use of crowd-sourcing solutions on one of its landing pages that visitors will find even if they do not browse to the “developers” section.

Lastly, Schlaeger et al.(2018), emphasize the importance of customization. Unisound does to my knowledge not close the feedback loop from customers to developers extensively enough to help developers customize solutions. The data analytics board is kept rather simple by tracking engagement but direct communication about customer wished for changes is not facilitated by rating systems and other functions yet (Unisound, 2019)

Efficiency of the Business Model

Overall it can be concluded that Unisound has a well-functioning and thought through business model that can be assumed to create the desired results. The revenue and cost structure as well as the key activities and partners match with the value proposition and expectations of an R&D driven company. The focus on its in-house hardware improvement and out-sourced product development seems efficient and is expected to succeed. However, incentives for developers should be created to increased developer input. Moreover, Unisound could think about tracking customers attempts to engage with the systems that failed to improve it.

References

Blohm, I., Zogaj, S., Bretschneider, U., & Leimeister, J. M. (2018). How to manage crowdsourcing platforms effectively?. California Management Review60(2), 122-149.


Damodoran. 2018. Retrieved on 12.03.2019 at http://pages.stern.nyu.edu/~adamodar/

Nishikawa, H., Schreier, M., Fuchs, C., & Ogawa, S. (2017). The value of marketing crowdsourced new products as such: Evidence from two randomized field experiments. Journal of Marketing Research54(4), 525-539.

Schlager, T., Hildebrand, C., Häubl, G., Franke, N., & Herrmann, A. (2018). Social product-customization systems: Peer input, conformity, and consumers’ evaluation of customized products. Journal of Management Information Systems35(1), 319-349.

Olson. 2013. Retreived on 11.03.2019 at https://www.researchgate.net/publication/257704728_Crowdsourcing_and_open_source_software_participation

Unisound, 2019 Retrieved at 05.03.2019 on https://www.unisound.com/usc.html

Yelin. M, Zhanqu Z. and Quijan H. (2018) Retrieved at 05.03.2019 on
https://www.caixinglobal.com/2018-07-19/provider-of-voice-services-becomes-chinas-latest-ai-unicorn-101306483.html

Co-creation through Onderling


Your winter tires get stolen from your garage. That is a bummer! Luckily, you have a household insurance policy. You file a claim at your insurance company but guess what? Your cars belongings are not covered by this insurance (Gaastra and Lasthuizen 2013). That does not sound very logical right? Well that is what the majority of the people on Onderling, an initiative of Dutch insurance company FBTO, also agreed upon. And that is why FBTO ended up paying out the money still (Emerce 2016). 

In order to innovate successfully, companies are increasingly seeking for new product or service ideas outside their boundaries (Nishikawa, Schreier, Fuchs, Ogawa 2017). Online communities are of increasing importance to businesses as they give companies new ways to interact with their consumers and can be used as input to innovate the offerings of a company (Ren et al. 2012).With the establishment of Onderling, FBTO tries to innovate beyond the existing way of doing business, making an attempt to address the problem arising between consumers and their insurance company.  Jeppesen Lakhani (2010) argue problem-solving effectiveness is vital to superior organizational performance. The goal of FBTO is to bring consumers and the company closer together. On the online platform everyone can join in the conversation and vote for real, actual claims and statements about insurances (Emerce 2016). 

This is how it works: you report a loss. When this loss is not insured according to the conditions, people insured at the company and employees of the firm have the opportunity to present their claim to the community on onderling.nl– experts already made the decision at this point. The community has the option to vote whether a claim should be paid and add their reasoning. For instance, someone could say the conditions do not classify this case clearly or it should be an exception to the rule. If 60% of the community decides the claim should get paid out, that is what will happen. Additionally, FBTO reassesses if the conditions as they designed it should be adjusted. This way, people help FBTO improve their products, communication and services (Emerce 2016; Gaastra and Lasthuizen 2013; Kruiper 2013) In summary, following the value co-creation framework of Saarjärvi, Kannan and Kuusela (2013), value is created by reassessing rejected claims and improving offerings from the gained insight provided by consumers. This value is created through B2C, in the form of re-evaluation and through C2B in the form of opinions and ideas. The mechanism used for co-creation is co-development, where FBTO can improves its offerings and gets to know what is important to their customers (Saarjärvi, Kannan and Kuusela 2013).Essentially, by providing feedback to improve offerings, they become part of the production process (Tsekouras 2019). 

The platform created by FBTO can be seen as a form of social computing, which is concerned with the intersection of social behavior and computational systems. The platform is a modern example of a technology giving rise to new ways of co-creation and interaction between companies and consumers (Oestreicher-Singer and Zalmanson 2013). FBTO created the platform to regain the trust of consumers and enhance transparency in the insurance industry, shifting from a service centric business to a customer centric business (Tsekouras 2019).The online community can provide users with useful informationm, support or  it can be a venue for discussion (Ren et al. 2014).The latter is the main strength of the website. The more people give their opinion, the more it becomes visible what people find important when it comes to insurance. With these insights FBTO can adjust their offerings to the needs of the customer. Even though the concept sounded promising, in the beginning the question was whether the concept would be successful. Would the insured be people loyal to each other and vote to pay out the money for every case? The opposite was true. Customers appeared to be critical and often agree with the choices of FBTO (Kruiper 2013).

According to Dellaert (2017),  FBTO’s system design could be efficient since it attempts to maximize joint payoffs for both the company as well as the customers. So, do customers see the added value of the new concept? Research shows they do. As you can see in the graph alongside, every aspect is assessed more positively after the implementation of Onderling (Gaastra and Lasthuizen 2013). Furthermore, the last few years FBTO has been declared most customer-friendly insurance company of the year multiple times. Overall, it seems customers see the added value of the concept. However, as with any business idea, FBTO experiences some challenges. The analysis also pointed out respondents were not very familiar with the platform. Only 23% of the people insured at FBTO ever visited the website of which 16% felt like voicing their opinion (Gaastra and Lasthuizen 2013). Furthermore, the biggest challenge is to involve the customers.Community engagement plays a primary part in creating sustainable competitive advantage,yielding higher profits and gaining loyalty from consumers (King, Racherla and Bush 2014).It is important to find users that have an high attachment to the community (Ren et al. 2014) Ren et al. 2014 highlight that a key downfall for companies is to attract the critical mass and engage them. This is no different for Onderling. When you want to let customer think along and incorporate their ideas, this demands organizational commitment. It is one thing to les customers think along, but the feedback from the community has to be processed and something has to be done with it. This means customers have to be top priority (Ren et al. 2014). On the one hand, the objectives of the organization have to be met, on the other hand it is extremely important task to represent the interests of the community members (King, Racherla and Bush 2014). Although it is proven that customer input did actually contribute to the improvement for products and services, it is not always easy to show employees of the firm the added value of customer interaction and to motivate them to actively support the community(Gaastraand Lasthuizen 2013).

So, what is next? To stay relevant, FBTO keeps experimenting with new ways of doing business that go beyond their existing boundaries. In 2016, FBTO started a trial where customers could decide for themselves what they wanted to insure, without policy conditions (Emerce 2016). In case of damage, the crowd would decide if you get your money or not, in a similar way as Onderling. The first trial did not gave the desired results but FBTO will try to keep innovating and serve their customers in the best way possible. Just like Henry Ford, the founder of the Ford Motor Company, once said about co-creation “Coming together is a beginning, staying together is progress, and working together is success” (Sanders and Stappers 2016).

Sources

Dellaert, B. G. (2017). The consumer production journey: marketing to consumers as co-producers in the sharing economy. Journal of the Academy of Marketing Science, 1-17.

Emerce. (2016) FBTO start crowdverzekeren. Retrieved from https://www.emerce.nl/nieuws/fbto-start-crowdverzekeren[03-03-2019].

FBTO. (n.d.) Nieuws en blogs. Retrieved from https://www.fbto.nl/nieuws-en-blog/paginas/consument-beslist-op-onderling-nl.aspx[07-03-2019].

Gaastra, S., & Lasthuizen, M. (2013) De kracht van onderling.nl. Retrieved from https://tudl3047.home.xs4all.nl/Synthese/wp-content/uploads/2015/08/Studie-3-Kracht-van-Onderling-FBTO.pdf[10-03-2019].

King, R. A., Racherla, P., & Bush, V. D. (2014). What we know and don’t know about online word-of-mouth: A review and synthesis of the literature. Journal of interactive marketing28(3), 167-183.

Jeppesen, L. B., & Lakhani, K. R. (2010). Marginality and problem-solving effectiveness in broadcast search. Organization science, 21(5), 1016-1033.

Kruiper, R. (2013) Crowdsourcing en co-creatie met FBTO. Retrieved from https://www.emerce.nl/best-practice/crowdsourcing-cocreatie-fbto[05-03-2019].

Nishikawa, H., Schreier, M., Fuchs, C., & Ogawa, S. (2017). The value of marketing crowdsourced new products as such: Evidence from two randomized field experiments. Journal of Marketing Research, 54(4), 525-539.

Oestreicher-Singer, G., & Zalmanson, L. (2013). Content or community? A digital business strategy for content providers in the social age. MIS quarterly, 591-616.

Ren, Y., Harper, F. M., Drenner, S., Terveen, L., Kiesler, S., Riedl, J., & Kraut, R. E. (2012). Building member attachment in online communities: Applying theories of group identity and interpersonal bonds. Mis Quarterly, 841-864.

Saarijärvi, H., Kannan, P. K., & Kuusela, H. (2013). Value co-creation: theoretical approaches and practical implications. European Business Review, 25(1), 6-19.

Sanders, E. B. N., & Stappers, P. J. (2008). Co-creation and the new landscapes of design. Co-design, 4(1), 5-18.

Tsekouras, D. (2019) Lecture 1: value co-creation.

Depop, yet another online marketplace?


What is Depop, and how does it work?

The story of Depop begins in 2011 at H-FARM, the Italian startup accelerator headquartered in the Venetian lagoon. Fast forwarding to the early days of 2019, Depop has 15 million users worldwide and H-FARM signed the exit from the startup’s capital with a return of six times the initial investment (Terzano, 2019). Overall, one would not be mistaken to label Depop as one of the most successful startups ever launched on Italian soil. Headquartered in London, Depop is a mobile-based marketplace that allows its users to buy and sell new or second-hand clothes, accessories and designer items. Its community is primarily composed of creative, young people and is the app of choice of many established influencers. It can rely on a stable growth of 250.000 new users per month, a team of 100 people divided among offices in London, Milan, New York and Los Angeles (EconomyUp, 2018).

The user, rather than being a “simple” buyer, is offered a space become a full-fledged entrepreneur by opening a virtual shop. undefined

As the picture shows, the interface closely resembles the one of Instagram. In a similar manner, users can stay updated regarding new listings by following other vendors, they can interact with a new item on sale by liking it, they can gather further information by posting a comment and they can directly message the vendor to negotiate the sale price and agree on the shipping method (by mail or in person). Coming to the revenue stream, Depop manages to stay up running by charging sellers 10% of the item sale price, once the transaction has occurred. This means that, as long as a vendor has not sold the item, no costs are incurred to keep the listing online.

Since the large majority of users are first-timers when it comes to selling a product online, Depop provides each new user with an extensive “bible” containing best-in-class examples to add successful listings, such as how photos of the item on sale should be taken and which information needs to be included in the product description. This, and many more suggestions have a double function: not only do they increase the likelihood that “novel entrepreneurs” have a successful experience with the app, but also that the overall quality of listings on the platform is high. A key feature along these lines is the possibility of leaving reviews on user profiles, which stimulates community members to strive for a quality feed and quickly flags instances of inappropriate behaviour. Another way through which Depop is trying to increase the “fashion savviness” of its users is through collaborations with establishes vintage sellers or experts of the industry that open their own shop on the platform. Such collaborations are another way of sparking curiosity and inspiration for best practices, as well as creating an element of excitement and buzz towards the latest trends in the world of vintage clothing. Overall, such collaborations aim at making the community feel more alive and offers users an opportunity for personal growth within this industry (Witte, 2018).

Problems and suggestions for improvement

In order to grasp what Depop users are mostly unsatisfied with and to provide possible suggestions for improvement, I decided to conduct an in-depth overview of app reviews on the consumer review website Trustpilot. Below are summarised the main issues that users have been reporting.

The Explore section features non personalised listings

One of the features of Depop is the Explore section, which is curated by the app’s Editor Team and is used to promote the best listings on the platform according to the “in-house style guidelines” (Depop, n.d.). However, users might be viewing categories of items that they are just not interest in buying, therefore causing Depop to lose on potential sales revenue. To solve this issue, Depop should tailor the Explore section to each user. For instance, they could populate this section with products that belong to categories similar to the ones viewed by the user during previous searches, therefore matching her/his tastes.

Scammers are a very real issue

Like any online marketplace, Depop users are not immune to scams. Over time, there have been various reports of sellers being paid but not sending the item, sending an item which is different from the one listed, or sending a counterfeit item. Overall, Depop does not seem to be providing enough measures against such unfortunate events and seller reviews alone are not a strong enough deterrent. To improve the current situation, Depop could take inspiration from eBay. For profiles that have too little reviews or do not provide parcel tracking with their deliveries, the famous online marketplace holds the payment for 21 days (eBay, n.d.). If, after such time frame, the buyer has received the parcel and has not reporting any wrongdoings, the payment is unlocked.

Vendors cannot track the performance of their listings

The last issue that users are facing is connected to the amount of information they have available to measure whether they are performing well and if there is room for improvement. In this regard, the only measures available at hand are the amount of likes and comments a listing receives and the customer reviews received by the community. To provide a better service to the community and attract new users, Depop could provide analytics insights that describe a profile performance in a more detailed manner. For instance, by knowing which item is being viewed the most, a user could shift her/his focus onto a specific product category. As it stands now, the user base is left in the dark and is missing out on key measures that would help them improve their virtual shop and the overall quality of the listings that populate the platform.

Overall, a close cooperation with its users can bring tangible improvements to the platform. The three points listed above provide three of the most mentioned pain points and require immediate action in order to provide a personalised, safe and insightful experience to the users.   

Sources

Depop. (n.d.). How do I get featured on the Explore page?. [online] Available at: https://depophelp.zendesk.com/hc/en-gb/articles/360001792207-How-do-I-get-featured-on-the-Explore-page- [Accessed 10 Mar. 2019].

eBay. (n.d.). Funds Availability. [online] Available at: https://pages.ebay.com/seller-center/service-and-payments/funds-availability.html [Accessed 10 Mar. 2019].

Economyup. (2018). 20 milioni a Depop, la lezione per il retail: permettere al cliente di aprire il proprio store online | Economyup. [online] Available at: https://www.economyup.it/retail/ratail-10-milioni-depop-la-startup-vende-abiti-online/ [Accessed 10 Mar. 2019].

Terzano, C. (2019). Exit H-Farm da Depop, cedute quote per 2,5 milioni di euro – Startupitalia. [online] Startupitalia. Available at: https://startupitalia.eu/103334-20190118-exit-h-farm-depop-cedute-quote-25-milioni-euro [Accessed 10 Mar. 2019].

Trustpilot. (2019). Depop is rated “Poor” with 4.5 / 10 on Trustpilot. [online] Available at: https://www.trustpilot.com/review/depop.com?languages=en [Accessed 10 Mar. 2019].

Witte, R. (2018). How Depop is Leveraging Collaborations to Grow Their Community. [online] Forbes.com. Available at: https://www.forbes.com/sites/raewitte/2018/06/26/how-depop-is-leveraging-collaborations-to-grow-their-community/#cad41705a004 [Accessed 10 Mar. 2019].

Teqoia: the platform for experts, not stars



Work has changed dramatically through digitalization. New forms of organizing work are gaining more and more attention. The emergence of peer-to-peer platforms, collectively known as the “platform economy,” has enabled people to collaboratively connect with each other and thereby link the demand for labour with its supply. Consumers have so far enthusiastically adopted the services offered by firms such as Uber, Lyft, and TaskRabbit (Zervas et al. 2017). These business operate as gig-economy platforms, formally defined as digital, on-demand platforms that enable a flexible work arrangement (Burtch et al. 2018).

The challenges of gig platforms

Although there are a lot of advantages for these gig platforms, there are also a number of challenges that lie ahead. One of the biggest challenges is to keep the work offered on the platform relevant. For the three abovementioned platforms, this is not really the case, because the work that has to be done is not that complex. However, for platforms as UpWork, where experts can offer their work, this is becoming increasingly challenging. When these online crowd experts want to have a viable long-term career option, they must be able to grow and continually refresh their skills (Suzuki et al. 2016). 

The downside of stars

Traditional workplaces make use of on the job training and internships to enable employees to develop their skills while providing financial support. Crowd workers, however, are disincentivized from learning new skills, because the time they spent on learning they are not working, which reduces income. Even if a worker does spend time learning new skills, platforms do not make it easy for the investment to pay off, as it is difficult to get hired for new skills. This is caused by the fact that most platforms are based on review systems, as ratings and reviews (Gupta et al. 2015). Users of platforms increasingly rely on online opinions and experiences shared by fellow users when deciding what products to purchase, or who to hire for a job (Shen et al. 2015). Because gig economy platforms have no ratings for the workers in their new skill areas, the possibility to get hired decreases. As a result, the skills of many workers remain static, and workers today often view these platforms as places to seek temporary jobs for their already existing skills, rather than as marketplaces for long-term career development (Suzuki et al. 2016). With online work is capable of expanding many full-time jobs, new business opportunities arise that integrate crowd work and career development. 

Teqoia

Since last year this gap in the market has been filled by the platform Teqoia IT Solutions, which has the aim to match supply and demand of labor. Teqoia makes technical knowledge and capacity of highly trained and specialized IT staff accessible to (inter)national clients. It has a clear focus on local for local, learning & development, and entrepreneurship. In the right balance this approach results in an optimal result for all parties involved and there is a win-win situation in which the platforms, workers and suppliers reinforce each other (Teqoia 2019).

The platform doesn’t work with review systems but gives a guarantee that each individual on the platform does meet a certain standard. To realize that promise, they have the Teqoia academy, where different trainings are given to ensure that they keep up with the current changes in technology. Teqoia also offers the possibility to follow the teqoia masterclass to improve their services. This is a traineeship that, through various training courses and modules, ensures that the worker has the required skills within seven months. 

Business case

Like most gig economy platforms, the financial model of Teqoia is based on a commission fee for mediating between supply and demand. In terms of strategy, Teqoia is pretty unique. It has positioned itself between traditional employment agencies and purely digital gig platforms; the reasonably fixed group of workers, the training and the quality guarantee of a traditional business, but with self employed workers, as on many different gig platforms. Which ensures a more lean business, which is a main advantage over the traditional businesses (Aloisi 2015).

Downsides of Teqoia

So, the main strengths of Teqoia are their lean business model and their quality guarantee. However, the organization of a platform in this way also has its drawbacks. One of the downsides of this approach is that Teqoia can’t make use of network effects, as most platforms do, because all the workers must be tested and trained to meet the quality requirements. Other platforms have grown exponentially, partly because of the two-sided network effects. This implies that when the number of users one side of the platform increases, the other side will be attracted more as well. In the end, a greater number of users increases the value to each and thus the total value of the platform (Eisenmann et al. 2011).Another, more straightforward downside has to do with the cost of testing and training workers. Most gig platforms charge a commission fee of around the 15% (Aloisi 2015), which should therefore be higher at Teqoia to cover the costs of training and testing. 

Future of gig work

The use of review systems to measure quality of workers does not improve the expertise of gig workers on the long term. Therefore, other business models, as Teqoia, arise. However, Teqoia faces some challenges, the idea of not looking at reviews and star-ratings anymore but providing a quality label for workers seems plausible. So I think that the future of experts gig platforms no longer focusses on stars, but on expertise.

For those who are interested in the platform (unfortunately in Dutch only):

References

Aloisi, A. (2015). Commoditized workers: Case study research on labor law issues arising from a set of on-demand/gig economy platforms. Comp. Lab. L. & Pol’y J., 37, 653.

Burtch, G., Carnahan, S., & Greenwood, B. N. (2018). Can you gig it? An empirical examination of the gig economy and entrepreneurial activity. Management Science, 64(12), 5497-5520.

Eisenmann, T., Parker, G., & Van Alstyne, M. (2011). Platform envelopment. Strategic Management Journal, 32(12), 1270-1285.

Gupta, N., Martin, D., Hanrahan, B. V., & O’Neill, J. (2014). Turk-life in India. In Proceedings of the 18th International Conference on Supporting Group Work (pp. 1-11). 

Shen, W., Hu, Y. J., & Ulmer, J. R. (2015). Competing for Attention: An Empirical Study of Online Reviewers’ Strategic Behavior. Mis Quarterly, 39(3), 683-696.

Suzuki, R., Salehi, N., Lam, M. S., Marroquin, J. C., & Bernstein, M. S. (2016). Atelier: Repurposing expert crowdsourcing tasks as micro-internships. In Proceedings of the 2016 CHI conference on human factors in computing systems (pp. 2645-2656). 

Teqoia (2019). Jouw toekomst. Via: https://teqoia.com/jouw-toekomst/het-begint-bij-jou/

Zervas, G., Proserpio, D., & Byers, J. W. (2017). The rise of the sharing economy: Estimating the impact of Airbnb on the hotel industry. Journal of marketing research, 54(5), 687-705.

Everyone can become an Instagram influencer


If you are active on Instagram, you probably are familiar with so called ‘influencers’. Influencers are people that are extremely active on Instagram and have built a certain credibility in a specific industry. Influencers post a lot of authentic content on Instagram and have often generated large numbers of engaged followers who trust them (Pixlee, 2019). Influencers have the power to affect the opinions and purchase decisions of their followers and more and more businesses are starting to work with them. The influencers post content featuring certain brands in exchange for money or gifts.

In the last couple of years, the influencer marketing industry has grown immensely. In the image below you can see that the industry value this year will be double compared to the value of two years ago (Influencer MarketingHub, 2019).

Influencer Marketinghub, 2019

Why is this marketing channel so popular? On Instagram, people have endless choices on what they would like to see. This is creating a problem for businesses as it is getting harder to reach their desirable audience. Influencer marketing offers a solution because businesses can target large audiences by letting influencers promote their product to their followers (Mathew, 2018). Nowadays consumers are becoming more sceptical about ads created by brands so another advantage of Instagram marketing is the fact that followers trust the influencers (Mathew, 2018).

Influencer marketing might be the perfect solution for large, international businesses who have a large amount of funds but it might be too expensive for small, local businesses. Popular influencers also have an audience consisting from people all over the world which means that the reach is too broad.  There is some research that even suggests that a cooperation with influencers that have a large number of followers can be negative for a business as it decreases the perceived uniqueness of the business (De Veirman, Cauberghe & Hudders, 2017)

As a result, a growing amount of businesses is starting to work with micro-influencers, which are influencers with less than 3000 followers. It is less expensive to collaborate with them, they have higher follower engagement and businesses can specifically target the niche that they operate in (Influencer MarketingHub, 2019).

So, Influencer marketing is on the rise, but there is also countermovement that argues that people reached a peak of trust in online influencers. Influencers are moving closer towards traditional media brands. The distinction between sponsorships and authentic recommendations is becoming vague and people do not know who to trust (Quoc, 2017). This is where Cirkle comes in and offers a solution.

What is Cirkle?

Think about your own Instagram behaviour, you’ve probably posted a picture of yourself and your friends in your favourite restaurant or in your new clothes just for fun. But what if you could get a reward for doing it?

Cirkle is a Dutch marketing- and loyalty platform where customers or visitors can promote and recommend their favourite businesses in exchange for discount on their next purchase. Cirkle’s vision is that everybody counts; it doesn’t matter whether you have 10 or 10.000 followers. Everyone on Instagram has a unique reach which can be valuable to businesses. Their idea is that businesses can outsource their social media marketing via the Cirkle platform to their own customers (Cirkle, 2019a).

How does it work for users?  

Instagram users can download the Cirkle app and view which businesses participate on the platform. Whenever users create authentic content featuring one of the participating businesses, they can post this content on their Instagram via the Cirkle app and recommend it to their own ‘inner circle’. The Cirkle app will make sure that the user will enclose the right tags and hashtags so the content is on point. As a reward for promoting the business, the user receives a discount. The discount depends on the reach and engagement on the user’s Instagram profile. The user can spend this discount the next time he or she visits the store (Cirkle, 2019b). So basically, users can get rewards for fun pictures they would normally post just by using the Cirkle app.

How does it work for businesses?

Businesses can register themselves on the platform for free and whenever someone posts content via the Cirkle app, the businesses pay a fixed fee of two euros. Cirkle helps businesses to increase their brand awareness and to create more instore traffic. Their own customers or visitors recommend the business on their Instagram which means that businesses reach new potential customers. Next to this, Cirkle also encourages customers or visitors to return to the business as they have discount that they can spend there. Cirkle also enables businesses to accurately track their Instagram presence by offering them data insights via their own dashboard. This way, companies can keep track of their social media presence. In order to make the platform accessible to all businesses, businesses can set a maximum amount of discount that a Cirkle user can earn. This way, it will be affordable for all businesses (Cirkle, 2019c).

I think that the platform is an innovative way to respond to the influencer marketing trend. Users can get rewarded for posting pictures they would post anyway which sounds extremely good. Businesses can outsource their marketing to their own customers, reach a larger audience and gets more loyal customers. Next to this, people on Instagram will get recommendations from their friends who they probably trust more than an influencer who was paid to promote the product.

Currently, Cirkle is still testing their platform so it is not yet available to the public. From 15 March 2019, it will be available to the public and around 500 businesses spread across Amsterdam and Rotterdam already joined the platform. So, if you’ve always dreamed of becoming an Instagram influencer, this is your chance!

Sources:

Cirkle (2019a) Over ons. Accessed via https://www.cirkle.social/about-cirkle/

Cirkle (2019b) User. Accessed via https://www.cirkle.social/user/

Cirkle (2019c) Business. Accessed via https://www.cirkle.social/business/

De Veirman, M., Cauberghe, V., & Hudders, L. (2017). Marketing through Instagram influencers: the impact of number of followers and product divergence on brand attitude. International Journal of Advertising36(5), 798-828.

Influencer MarketingHub (2019). Influencer Marketing Benchmark Report: 2019. Accessed via https://influencermarketinghub.com/IM_Benchmark_Report_2019.pdf

Mathew, J (2018, 30 July). Understanding Influencer Marketing And Why It Is So Effective. Accessed via https://www.forbes.com/sites/theyec/2018/07/30/understanding-influencer-marketing-and-why-it-is-so-effective/#d35a9b871a94

Pixlee (2019). What is a social media influencer? Accessed via https://www.pixlee.com/definitions/definition-social-media-influencer

Quoc, M. (2017, 15 Dec) Millenials Are Losing Trust in Online Influencers. Here’s What Marketers Can Do. Accessed via https://medium.com/dealspotr/influencer-marketing-tips-millennials-trust-da946f0bce18

BELLINGCAT: SOLVING WORLD’S INJUSTICES VIA CROWD-SOURCING


Where traditional spy agencies like the CIA, MI6 and Interpol fail to identify and answer global criminal cases, a new independent investigative journalism platform has been created that utilizes crowd-sourcing in order to solve these cases. Sounds almost superhero-like, doesn’t it? Well, Bellingcat might just be the ‘crime-solver’ the world was actually looking for.

The business model

Bellingcat identifies itself as “the home of online investigation”, as it uses open source initiatives and social media in order to investigate criminal activities and conflicts around the world. By bringing together professionals and volunteers, Bellingcat provides a platform where these injustices can be tackled collectively. (Bellingcat, n.a.) The collective approach to problem-solving can be traced back within the name. “Belling the cat” stems from a tale about a group of mice deciding that the best way to protect themselves from a cat is to place a bell around the cat’s neck, but are then unable to find a volunteer to attach the bell. “Therefore, we are the mice”, according to founder and CEO Elliot Higgins. (Doward, 2018)

The concept started out as a hobby by British journalist Eliot Higgins, once a college drop-out from his study Media Technology at Southampton University. Initially, he started writing blogs on conflicts, such as in Libya, under the pseudonym of Brown Moses. He realized that social media content on these conflicts were being largely ignored within investigations. Therefore, he began collecting this content and combining them to make compelling cases. (Doward, 2018) Eventually in 2014, the Bellingcat platform was launched with crowdfunding help from their Kickstarter campaign. As of now, they consist of 11 full-time employees, with their head office located in Leicester. To keep the business running, paid workshops and seminars on online investigative techniques are given to create revenue and motivate individuals to contribute. Increased interest from NGO’s such as the Google Digital News Initiative and charities such as the Dutch Postcodeloterij have also provided Bellingcat with grants in order for them to expand their operations. (Matthews, 2018)

Methods, techniques and contributions

Known as OSINT (open-source intelligence), Bellingcat’s method of journalism collects data from publicly available sources to piece together, debunk or verify a story. The investigative technique involves strolling the internet and then cross-referencing social media posts, tweets, news photographs, databases, Google Street View and maps into a detailed mosaic of apparently undisputable data. (Matthews, 2018) This is done by professionals who work full-time at Bellingcat, leading these investigations and are supported by a larger group of “amateur investigators” who, from the comfort of their own homes, voluntarily perform these methods. They meet and talk in Facebook groups, subreddits and threads of direct messages on Twitter, discussing new tools and techniques and working with any changes to social networks that might help or hinder their work. “A lot of people who are involved with Bellingcat are from those communities, and have a kind of nerdy desire or obsession with problem-solving when it relates to big stories”, says Press Association social media journalist, Alastair Reid. (Chakelian, 2018)

Figure 1: OSINT Landscape by Bellingcat

Due to the large pool of volunteering contributors, the ‘Wisdom of the Crowds’ phenomenon arises, where input from a larger group results in more trustworthy answers. Bellingcat’s information has been judged watertight enough to be used by the official commission investigating the downing of MH-17 and has been cited in the United Nations as proof of Syrian war crimes (Matthews, 2018). Bellingcat contributors found photos on the internet of fourteen Russian officers posing with the alleged BUK-rocket which shot Malaysian Airline flight MH17 from Amsterdam to Kuala Lumpur out of the air near Donetsk, Ukraine (Doward, 2018). Next to that, contributors were able to pinpoint the blame for chemical weapon attacks by the Syrian regime. The latest investigation that caught the global news headlines and is still ongoing is about the poisoning of Sergei Skripal and his daughter Yulia in Salisbury, England. Together with Russian website The Insider, Bellingcat contributors were able to identify one of the wanted men by downloading passport data of millions of Russian citizens. The suspect was found to be Anatoliy Chepiga, who is an officer from the GRU, the Russian military intelligence, being active behind the alias Ruslan Boshirov. (Doward, 2018)

Allegations, refutations and potential

Although much praise is being given to Bellingcat, also allegations and critic has been given from mainly the Russian government. Allegations vary from being accused as a CIA information warfare department to spreading fake news and illegally retrieving their information (Matthews, 2018). As mentioned, most of these allegations come from the Russian government. This is not that surprising, as many of the investigations led by Bellingcat see Russia playing a large role within the injustices (e.g. MH17, Skripal).

“When Russia started attacking our work I’d already spent two years building up a reputation. All they’ve managed to do since is to prove that whenever they end up attacking our work it’s because we end up being right about something. The more noise they make, the more truthful something appears, basically”, according to Bellingcat director Elliot Higgins (Doward, 2018). Moreover, in many of the investigations, Bellingcat is ahead of Western intelligence agencies when it comes to finding evidence due to Bellingcat’s willingness to buy information on the black market or retrieve it from pirate sites, making them better than governments at gathering information from open sources. (Matthews, 2018) Therefore, they are proving to be a highly efficient independent agency, simply leveraging the power of active member participation of a large and diverse group of contributors.

It is safe to say that Bellingcat’s potential is huge. They are still a relatively young platform, growing every day. As more volunteers join, more information will be found which will also prove to be more trustworthy. This will result in more support from NGO’s, charities and eventually official government systems. Recently, the Dutch Postcodeloterij funded them half a million euros in order to set up a new office in The Hague, the city home to the International Court of Justice (Walker, 2019). Will it just be a matter of time for Bellingcat, an open crowd-sourced investigative platform, to become the global leader in solving worldwide crime and an official authority within the constitutional state? Time will tell, but it is certain that exciting times are ahead.

Bibliography

Bellingcat, (n.a.).About”. Bellingcat.com.Retrieved from <https://www.bellingcat.com/about/&gt;.

Doward J., (2018).“How a college dropout became a champion of investigative journalism”. The Guardian. Retrieved from <https://www.theguardian.com/media/2018/sep/30/bellingcat-eliot-higgins-exposed-novichok-russian-spy-anatoliy-chepiga&gt;.

Matthews, O., (2018). “How Bellingcat outfoxes the world’s spy agencies”. The Spectator. Retrieved from <https://www.spectator.co.uk/2018/10/how-bellingcat-outfoxes-the-worlds-spy-agencies/&gt;.

Chakelian A., (2018). “What is Bellingcat? Behind the tactics revealing the Skripal suspect and Cameroon killers”. NewStatesman. Retrieved from <https://www.newstatesman.com/politics/media/2018/09/what-bellingcat-behind-tactics-revealing-skripal-suspect-and-cameroon-killers&gt;.

Walker J., (2019). “Bellingcat to establish new office in The Hague after €500,000 funding win through Dutch postcode lottery”. PressGazette. Retrieved from <https://www.pressgazette.co.uk/bellingcat-to-establish-new-office-in-the-hague-after-e500000-funding-win-through-dutch-postcode-lottery/&gt;.

Rethinking Ridesharing … For Kids?


Nowadays, through just a few taps on your smartphone, you can get a ride to your desired destination from your current location. This is because innovation and technological advancements, paired with the widespread ownership of smartphones, have given rise to peer-to-peer centralized taxicab platforms. These app-based platforms match demand (people who need a ride) with suppliers (people with cars), and set prices to facilitate transactions. (Proserpio & Tellis, 2017). Today, the global ridesharing industry has been valued at over $61 billion, with projections that it will grow to $218 billion by 2025 (Curley, 2019).

With major players like Uber and Lyft dominating the market, who have a combined market share of 98% in the US for example, it’s difficult to see the space or need for new entrants (Molla, 2018). But there is one group of riders who are underserved in this market – kids. Namely, kids soliciting ridesharing services, or parents requesting it in order to shuttle their kids to activities. This seems like a convenient way for busy parents to get their kids from A to B, but there is a major problem – it’s simply not allowed. Account holders on Uber and Lyft must be 18 or older and cannot request a ride on the behalf of minors, unless they are accompanied by an adult (Heilweil, 2019). Uber and Lyft simply don’t have the certificates or insurance necessary to allow unaccompanied minors, and don’t want the liability that comes with it (Gibbins, 2018).  So how are kids supposed to get where they need to go when their parents are busy?

HopSkipDrive

This is where HopSkipDrive enters the picture. HopSkipDrive is a California based ridesharing taxi cab service, founded by three moms, catered specifically to minors. It was founded in 2014 by three working moms struggling to get their kids where they needed to go. (HopSkipDrive, 2019) With initial funding of $14.1 million, their objective is to make a difference in the lives of kids and parents by providing a safe and dependable way of getting kids where they need to go.

How It Works

On the app, parents can request a ride or preschedule one up to 8 hours in advance. For reoccurring activities like after school sports, parents can save rides and ‘repeat’ them. If kids from many families are all going to the same destination, the app has a carpool feature which will coordinate the pickup of kids from several locations for a discounted price. (HopSkipDrive, 2019)

In addition to servicing families, HopSkipDrive also offer ridesharing services to schools. By working with school districts, they are able to unlock opportunities for substantial business growth (Roof, 2018). Schools can book drivers for field trips or students who require special care, with just a few taps. Furthermore, if a school bus isn’t completely full, it can be a much cheaper option for schools to hire HopSkipDrive services instead. (HopSkipDrive, 2019)

HopSkipDrive Mobile App

To ensure the safety of kids using the service, HopSkipDrive puts it at the center of everything they do. Drivers are referred to as “CareDrivers”, who double as caregivers. To be a CareDriver, you need to be over 23 years old, have at least five years of childcaring experience,  a clean driving record, as well as a car that is no more than 10 years old (HopSkipDrive, 2019). Furthermore, drivers are required to pass a multi-agency background check, which includes fingerprinting, before they are officially registered on the app. HopSkipDrive also allows parents to provide detailed pick-up and drop-off instructions, and CareDrivers will confirm a predetermined ‘codeword’ and date of birth with each kid they pick up. Furthermore, all rides are monitored in real time by the HopSkipDrive team. (HopSkipDrive, 2019)

Efficiency of the Business Model

There is considerable demand from working parents to get their kids to activities efficiently and safely and with little time for preplanning. HopSkipDrive allows parents to organize rides for their kids whenever the need arises. On the other side, drivers are able to use their own cars, and spare time, to earn extra money. HopSkipDrive drivers can earn up to $30/hour, which is about three time more than Uber or Lyft drivers (Gibbins, 2018). Many parents are willing to pay the premium price for a safe service, and it is often cheaper than getting babysitter. There is however less flexibility regarding working hours for drivers on the HopSkipDrive app than on Uber of Lyft. This is because kids are in school all day and for the most part require rides in the early mornings, with requests only picking up again in the afternoon. Furthermore, a large number of rides on the app are prescheduled. (Gibbins, 2018)

There are clear internal rules and regulations in place to ensure the safety of kids, like strict behavioural guidelines as to how drivers are supposed to interact with the kids they are driving (HopSkipDrive, 2019). Unlike Uber of Lyft, HopSkipDrive has certificates and insurance necessary to work with minors, and a $1 million liability coverage (HopSkipDrive, 2019). There are legal measures that drivers must go through, namely drivers in California must register with TrustLine, which is a state database for nannys and babysitters. On the one hand, this restricts the number of potential drivers considerably because many do not fit the requirements, or do not have the time to go through the registration process. On the other hand, it may in fact open up the ridesharing industry to potential drivers who otherwise wouldn’t have considered it. HopSkipDrive drivers are almost all female, and either mothers, babysitter, teachers or so called ‘empty nesters’, who feel safer driving for HopSkipDrive than Uber or Lyft, and enjoy caring for kids (Heilweil, 2019).

This business model of ridesharing for kids has not been met without difficulties. Several similar platforms, like Shuddle and Shepherd, have shut down, despite receiving  considerable funding initially. These platforms sited issues stemming from the driver vetting and registration process taking too long, and failing to secure more funding after running into financial difficulties (Heilweil, 2019). In 2017, Uber piloted its own program for teenagers ages 13 to 17, but eventually shut it down after little success. This stemmed mainly from the fact that regular Uber drivers were used, who received no extra training or guidelines as to how teens should be transported  (Heilweil, 2019).

The Future Ahead

Building a ridesharing business is already a difficult and expensive thing to do, and adding kids into the mix doesn’t make it any easier. Despite the challenges noted above, the market for kid’s ridesharing is continuing to grow, with HopSkipDrive securing another $7.4 million of funding just last year (Roof, 2018). However, HopSkipDrive is not without competition and Zūm, another ridesharing platform for kids just raised their total funding to $70 million, and is already present in three States (Dickey, 2019).

Due to the somewhat uniform schedules of children, it’s a questionable whether drivers on kids ridesharing platforms will continue to get enough work on the average day. Because of this, it could be essential for these platforms to expand their businesses further than just parents requesting rides. The future of ridesharing for kids could be to sell rides directly to schools, largely replacing traditional school busses, something these platforms have already started exploring (Pinsker, 2018).

Sources

Chuang, T., 2018. First “Uber for kids” ride service launches in Denver by three moms, including one who grew up here. [Online]  Available at: https://www.denverpost.com/2018/04/05/hopskipdrive-uber-for-kids/

Curley, R., 2019. Global ride sharing industry valued at more than $61 Billion. [Online] Available at: https://www.businesstraveller.com/business-travel/2019/01/04/value-of-global-ride-sharing-industry-estimated-at-more-than-61-billion/

Dickey, M. R., 2019. Zūm, a ridesharing service for kids, raises $40 million. [Online] Available at: https://techcrunch.com/2019/02/28/zum-a-ridesharing-service-for-kids-raises-40-million/

Gibbins, P., 2018. Comparing the Top 4 Rideshare Apps for Kids. [Online] Available at: https://therideshareguy.com/top-rideshare-apps-for-kids/

Goldstein, M., 2018. Uber And Lyft: The Cost And Benefits Of Disruption. [Online]  Available at: https://www.forbes.com/sites/michaelgoldstein/2018/05/09/uber-and-lyft-the-cost-and-benefits-of-disruption/#568fcc4adfcb

Heilweil, R., 2019. THE TRICKY BUSINESS OF MAKING RIDE-HAIL WORK FOR KIDS. [Online] Available at: https://www.wired.com/story/ride-hail-sharing-kids-hopskipdrive-zum-kango/

HopSkipDrive, 2019. About. [Online] Available at: https://www.hopskipdrive.com/about

Molla, R., 2018. Lyft has eaten into Uber’s U.S. market share, new data suggests. [Online]  Available at: https://www.recode.net/2018/12/12/18134882/lyft-uber-ride-car-market-share

Pinsker, J., 2018. What Is the Future of Getting Kids to Soccer Practice?. [Online] Available at: https://www.theatlantic.com/family/archive/2018/10/uber-lyft-kids-hopskipdrive-zum/573424/

Proserpio, D. & Tellis, G. J., 2017. Baring the Sharing Economy: Concepts, Classification, Findings, and Future Directions. [Online]
Available at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3084329

Roof, K., 2018. HopSkipDrive raises another $7.4 million for its Uber for kids business. [Online] Available at: https://techcrunch.com/2017/11/21/hopskipdrive-raises-another-7-4-million-for-its-uber-for-kids-business/

Digitising warrantees


We’ve all experienced it – that dreaded moment when a new appliance suddenly stops working. And rather than giving you comfort, the idea that it is still under warranty gives your stomach muscles a twist. Where is the receipt – is it in the trusty old box labelled “receipts & other stuff” in the study; or in the pile of to-be-filed papers collecting on the dining-room table?  And if you are lucky enough to find it, will it be readable or has the ink melted away into the thermal paper.

In this post, I evaluate the concept and technology being developed by a team of South African entrepreneurs to digitise warrantees. By further unlocking the use of block-chain technology (Van Rooyen, 2017), key role players in the day-to-day transaction cycle will be connected to streamline the warranty and warranty-claims processes and eliminate the need for paper-based warrantees. 

What is a digital warranty?

The concept is for manufacturers to create product information, which include the warranty parameters, in an Ethereum  blockchain at the point of manufacture. Retailers will augment this information in the chain with the sales information when the item is sold to the consumer, thereby creating the warranty information. The consumer will then use an app to add their details to the chain which completes the digitised warranty.

How would it work?

Figure 1: Product and warranty information created by manufacturer

Figure 1 shows how a manufacturer would create its finished goods in the chain, including product information (for example, make, model, serial number, etc) and the warranty parameters (for example, term/period, type of warranty – repair only, replace only, repair or replace, service only). The manufacturer will also record when the item is sold to a retailer or distributor to allow for the tracking of items (weather it is in transit, on-floor or with the consumer).

An additional feature for manufacturers would be product placement in the app, once the consumer has completed the steps illustrated in Figure 2 below, using code from one of the readily available open-source recommendation agents. For example, a customer that registers a new 50″ TV can be sent a notification, or shown in the app, what other customers bought in addition to the TV – for example, a sound-bar. Also, on expiry of a client’s warranty, manufacturers can push replacement products to consumers or give the consumer the option of buying an extended warranty.

Figure 2: Digital warrantees from a retailer and consumer perspective

Figure 2 illustrates the process flow once the consumer has purchased the product which, in most cases, is when the warranty is activated. Participating retailers will add a QR code to the printed receipt which the consumer will scan with their smartphones, directing them to the digital warranty app. It is anticipated that large contracted-in retailers will require only a unique code from the customer – their warranty wallet number – to have the purchase sent to their digital warranty wallet, eliminating the need for a printed receipt altogether. Registering on the app can be done through an email & password combination or using an existing social media account. A broadly similar workflow, with different interfaces, will exist for consumers that want to register and manage their warrantees online instead of on the app. Once registered, they can add new warrantees, create an asset register or manage their warrantees – for example, take out extended warrantees – directly on the app or online. Opt-in notifications will send consumers an alert when an item’s warranty is about to expire and offer extended warrantees where these are available as well as advertisements from manufacturers.

Most importantly, because the information in the chain is immutable, consumers no longer need a physical receipt and any claim they make against the warranty will automatically be validated through the entry in the chain. By placing the customer at the centre, various add-on services can be created to manage the claim process on behalf of the manufacturer – for example, courier services to move items to and from the service centre or providing loan items for critical appliances.

Why would people use this?

For the consumer

  • Easy access: Purchase information is stored in one place, making it easy to reference and access when needed in a fast and efficient manner. 
  • Durability: Unlike paper receipts that are often printed on thermal paper, a record created in a blockchain is immutable and permanent. 
  • Acceptance: The decentralised nature of blockchain technology means that the warranty is automatically validated in the chain in the event the consumer needs to make a claim. 
  • Free storage: e-slips eliminates the needfor space-consuming and complex filing systems.   
  • Information security: Personal information is stored only once in the app rather than with multiple retailers, which reduces it’s susceptibility to malicious or accidental disclosure. 

For the wholesaler or manufacturer and the retailer

  • Customer loyalty:  Completing forms, collecting data and hard copy documents are a thing of the past which is likely to improve brand loyalty & increased repeat sales. 
  • Reduction in fraudulent claims: As the authenticity of the warranty is no longer paper-based and dependent on human error, it is expected that the cost of fraudulent claims will reduce. Claims for “fake” or counterfeit products will no longer be an issue as the manufacturer or retailer can track the chain of custody of each product.
  • Increased sales: Product placement and recommendations within the app or making extended warrantees available can generate revenue.
  • Cost reduction: Efficiency in the sales and warranty claims process. Printing and printer maintenance cost will reduce.
  • Reduced carbon footprint: Consumers respond positively and reward retailers with loyalty when the retailer demonstrates awareness of and a reduction in its carbon footprint.

What are the challenges and how will the entrepeneurs respond?

  • Monetising the service: The reality is that, whilst consumers may crave the simplicity of the service, not many will be willing to pay for it. Revenue streams would need to come from manufacturers and retailers who may not see the immediate benefit to them. Emphasis should, therefore, be on creating the ability to track inventory through the entire value chain, quick validation of warrantees when claims are made and increased sales from product placements. An additional consideration is to let consumers experience the service and then implement a pay-as-you-want pricing model for people to contribute toward the service.
  • Scale of the ecosystem: There are many role-players in the value chain which complicates negotiations and, due to the highly competitive nature of the consumer goods market, open discussions are tricky to navigate. Seeking out an advisory board for the initiative that is credible in the retail sector and can offer good connections is imperative, as is an experienced negotiator.
  • Lack of trust leading to low uptake: Whilst consumers, retailers and manufacturers would all appreciate the convenience, online trust is a subjective emotion that is hard to establish for new providers. This is especially the case where a recommendation agent recommend additional products, sponsored by the manufacturer, to consumers. All sponsorships will be disclosed in addition to comments as to why the specific product is being displayed. The choice of initial partners – retailers and manufacturers – is crucial to creating trust and credibility for the service. In addition, electronic word-of-mouth references from retail-industry influencers/stalwarts will increase adoption.
  • Funding: Like all start-ups, the team are looking at different funding options for their business. One of these options is crowdfunding to see if that attracts a suitable investment without having to give up too much of the company’s equity.

Conclusion

The portability of the information collected through this process to other organisations – like short-term insurers and financial institutions – and the actual service to other industries – like motor-vehicle warrantees – are wide-reaching. Whilst there are many and seemingly sizeable challenges to overcome, the benefits throughout the entire value chain and the rather simplistic technical solution to realise these benefits, makes this a no-brainer.

The team of entrepreneurs in South Africa are excited to deal with the challenges and are confident that the various role-players will come together, putting the consumer at the centre, to make this possible. Look out for your electronic warrantee coming soon.

References

Kulkarni, A. (2018). What else could blockchain be used for? Quora. Retrieved from https://www.quora.com/What-else-could-blockchain-technology-be-used-for/answer/Ajit-Kulkarni-4 on 22 February 2019.

Van Rooyen, J. (2017). Real-world applications of blockchain-enabled supply chains. Resolve SP. Retrieved from http://pressoffice.itweb.co.za/resolvesp/PressRelease.php?StoryID=275840 on 22 February 2019.

Did you receive an unjust traffic fine? Challenge it with a robotic lawyer!


Everyone must be able to use his or her rights. Therefore, Appjection strives to improve access to the law. At Appjection, they noticed that people were too lazy to challenge their traffic fines, even when the fines were unjust. This lead to their idea: an app where people can easily challenge unjust traffic fine on their smartphone.  

In 2016, three students from Leiden University founded Appjection. At the start of their business, they managed to win the ‘De Brauw Legal Innovation Challenge’ in 2016 for which they received €25.000 euros of financial support for their business and free legal advice of De Brauw lawyers (Potjewijd, 2016).

Appjection makes it easy to file an objection against fines and other administrative decisions. According to the founders, only 2.5% of the submitted objections are currently officially wrongly declared (Arag, 2018). However, the actual number of unjustified fines is much higher according the founders of Appjection (Arag, 2018). A possible reason for this, is the lack of knowledge on how to draw up an objection and how to appeal after a rejection. Mostly, people think it is a waste of time and they just pay their fine because they do not think it is worth it to make the effort to object.

How does it work?

By using artificial intelligence, Appjection can handle large numbers of fines. The process starts by people taking a picture of their fine and uploading it to Appjection. The system automatically extracts all the information from the fine that is necessary. This is done by using text recognition from Google Vision (Koot, 2018). The software recognizes the words on the fine which are then converted into digital text. After uploading the fine, the system asks to answer several questions about the fine and the moment it happened. The customer also needs to indicate why he or she does not agree with the fine. Submitting the fine will only take a few minutes. Based on the information provided, the system searches the database for previous similar cases and generates a customized objection for every fine uploaded (Koot, 2018). Moreover, it checks whether there is a reason to make an objection and whether this objection has an actual chance of success. When there is no opportunity of success, Appjection makes no objection. If there is a reason to make a successful objection, the system automatically completes the process and files the objection.

Source: Startupdelta.org

After the system processed the fine, the customer will receive an acknowledgement with the reference number. One of the lawyers of Appjection will tell the customer within a few days whether the objection has a chance of success (Appjection, n.d.). If there is a chance of success, the system will file the objection either digitally or by post. If there is no possibility for an objection or chance of success, they will tell the customer why. As soon as something changes in the status of customers’ objection, they will be informed by e-mail (Appjection, n.d.).

Business model

Appjection is offering their service for free. It does not matter if Appjection wins or loses, the service is always free of charge. This is possible because they receive a compensation from the government when the objection is successful. In the Netherlands, there is a law which states that if professional legal aid is provided, and it is proven that a fine was deemed unjust, a compensation will be provided by the government (Zorab, 2018). The compensation they receive from the government contains a legal costs allowance, which is intended as a compensation for the costs of lawyers who provide legal assistance. Therefore, if the customer would have filed the objection himself, he or she would not receive this compensation (Appjection, n.d.).

Moreover, Appjection also partnered with some companies. This is a good initiative to be able to grow their platform as their business is dependent on the number of customers submitting traffic fines. They started a cooperation with legal assistance insurer Arag and Leaseplan, an international Dutch company that is specialized in car leasing (Arag, n.d.; LeasePlan, n.d.). Because of the cooperation with Appjection, their customers have the possibility to object unjust fines in a simple way.

Efficiency of the Model

The system works well for rather simple fines as the database is filled in manually by the founders until now. However, filling in this database will go automatically in the future through deep learning, where the software learns from the outcome of the cases and automatically updates the database (Koot, 2018). For now, this might be a drawback of the App, as it can mainly be used for rather simple fines.

Furthermore, as stated before, Appjection receives a compensation when they file an objection that turns out to be successful. Therefore, their business model is dependent on the number of fines that are submitted by customers. When customers only submit fines that have no chance of success or when they do not submit fines in general, the business model will not be sufficient. Their business model, or the value they create, is therefore dependent on customers. They create value from customers sending in their fines.

Future Plans

To build a bigger market, Appjection is planning to use the system for other areas as well. One of the founders, states that he sees opportunities in various other categories, such as taxes, UWV and flight delays (Mr. Online, 2017). Right now, Appjection consists of a team of 4 people including a Chief Technical Officer (Mr. Online, 2017). They believe that their business has a high potential to grow, not only in the Netherlands but throughout the whole world. Although the law in the Netherlands makes it easier to gain revenue, the founders do have plans to move abroad (Zorab, 2018). By building new partnerships and getting offered an investment of €100,000 euros recently in a Get In The Ring initiative, they might be able to realize these future plans (Get in the Ring, n.d.). By using this system, customers just need to sit and relax, while a robotic lawyer challenges their fines. What more do they want?

References

Appjection. (n.d.). Onterechte boete? Check binnen een paar minuten kosteloos of je bezwaar kunt maken. Retrieved March 6, 2019, from Appjection: https://www.appjection.nl/

Arag. (2018, September 14). LegalTech startup Appjection slaat met ARAG handen ineen in strijd tegen onterechte verkeersboetes. Retrieved from Arag – Persbericht: https://www.arag.nl/medien/pdf/persbericht_-_onterechte_boetes_aanpakken.pdf

Arag. (n.d.). In beroep gaan tegen verkeersboete. Retrieved March 6, 2019, from Arag: https://www.arag.nl/particulier/reizen-en-verkeer/verkeersovertredingen/bezwaar-verkeersboete/index.html

Get in the Ring. (n.d.). 600k investment offers live on stage at Get in the Ring Netherlands 2019. Retrieved March 6, 2019, from Get in the Ring: https://getinthering.co/600k-investment-get-in-the-ring-netherlands/

Koot, J. (2018, October 25). Robot vocht al 2000 Nederlandse boetes aan. Retrieved from Financieel Dagblad: https://fd.nl/futures/1274924/robot-vocht-al-2000-nederlandse-boetes-aan#

LeasePlan. (n.d.). Informatie voor leaserijders. Retrieved March 6, 2019, from LeasePlan: https://www.leaseplan.com/nl-nl/mijn-leaseauto/

Mr. Online. (2017, November 7). WHIZKIDS BESTORMEN LEGALTECHMARKT. Retrieved from Mr. Online: https://www.mr-online.nl/whizkids-bestormen-legaltechmarkt/

Potjewijd, G. (2016, June 6). De Brauw announces three finalists of its Legal Innovation Challenge. Retrieved from De Brauw Blackstone Westbroek: https://www.debrauw.com/newsitem/de-brauw-announces-three-finalists-legal-innovation-challenge/

StartupDelta. (n.d.). Dutch Tech to Watch – Appjection: Automated Professional Legal Aid. Retrieved March 6, 2019, from StartupDelta: https://www.startupdelta.org/dutch-tech-to-watch-appjection-automated-professional-legal-aid/

Zorab, J. (2018, February 5). Max Heck: Legal Geek of the Week. Retrieved from Legal Geek: https://www.legalgeek.co/read/max-heck-legal-geek-week/

Orwellian Social Credit system: myth or reality?


Black Mirror

Everyone who has been keeping up with the offering of Netflix has heard of Black Mirror, the series about dystopian worlds becoming reality. In one of the episodes writer Charlie Booker depicts a world in which every citizen has a social score that everyone can vote on when getting into contact with the person in question. The main character of the episode is at a certain point in the episode denied access to a flight due to her low social score.  A scary thought, but as it turns out very much reality. The Chinese government intends to implement a similar system as portrayed in Black Mirror in which people are assigned a social credit. Main difference is that this score is attributed by the government through big data, not by fellow ‘victims’. In the coming year, 2020, the social credit system is bound to kick off. While the examples of a poor social credit provided in the Orwellian Black Mirror episode approach extremes, some of the scenes will turn out to be real consequences in China. For example, by the end of 2018 more than five million citizens of China have already been denied access to high-speed rail tickets due to having been placed on a blacklist due to debt  (Needham, 2019). Some other implications for citizens once the system initiates are being unable to find a job in civil service, journalism and legal fields or having your children being denied access to high-paying private schools (Botsman, 2017).

Sesame Credit

What if I told you that this social system has been a reality for over four years already? That’s right. Alibaba, the Chinese multinational giant in e-commerce and other sectors, has assigned its customers with a social credit score, commonly referred to as Sesame Credit (Jefferson, 2018). Alibaba is known to have close affiliates with the Chinese government and the Sesame Credit is partially a trial version of the social credit system about to be introduced (Financial Times, 2017).

So what is the Sesame Credit and how does it work? Alibaba collects a ton of data on their customers. Given that they are active in insurance, loans, e-commerce and even dating, it is evident that they have a lot to analyze. The credit system uses data on more than 300 million people and 37 million businesses (Alibaba Group, 2015). To add to this, their ties with the Chinese government provide them with access to official identities, financial records and even messages of Chinese WhatsApp alternative WeChat (Huang, 2017). All this data is gathered by Alibaba and then analyzed to come to a Sesame Credit, which can be interpreted as an indication of someone’s trustworthiness. While the exact algorithm they use to determine a person’s Sesame Credit is unknown, it is known that the heaps and heaps of data collected all amount to a different rating in five categories. Namely, credit history, fulfillment capacity (ability to live up to contract terms etc.), personal characteristics, behavior & preferences and lastly interpersonal relationships (i.e. your friends). Bound together, you get yourself your very own Sesame Credit.

Applications

Now, what to do with your Sesame Credit is a natural next question. A main difference when comparing the Sesame Credit to the approaching Social Credit system by the Chinese government is that the Sesame Credit is about rewarding trustworthy people rather than punishing those that do not have a high rating. Some ways in which the credit score has rewarded customers are when applying for a loan with Ant Financial, a daughter company of Alibaba or when trying to book a night at a hotel. The merit to a high social score there is not having to pay up front due to the high trustworthiness. Baihe.com, a Chinese dating site, has even started to allow users to add their Sesame Credit to their profile as a way to provide better dating opportunities for users (Hatton, 2015). These are just some of the more obvious applications for the Sesame Credit and how it creates value for people with a high rating.

A remaining question is the value for Alibaba itself. Other than being a nice perk to hand out to customers, a first glance at the credit system raises the question as to what the use is for Alibaba. The reason why Sesame Credit or any social credit in China has a lot of purpose for these entities is the way it points out desired behavior. By encouraging people to behave by making them aware of the fact that every move is being monitored and therefore counts, people will start to behave more desirably in order to retain their high Sesame Credit and, consequentially, the rewards that come with it.

Basically, the Sesame Credit seems to be a win-win situation for those people that are, in the most broad definition of the word, decent and Alibaba. By evoking good behavior in people so that their Sesame Credit becomes an accurate reflection of their proper conduct, Alibaba boosts the average trustworthiness of their customers as well as providing their model citizens with proper rewards. Naturally, there are questions as to the ethics of monitoring every step customers take as well as analyzing them and adding a trustworthiness tag to a human being, but all ethical issues aside, the business model seems to merit both the user and the company. It works, and given that Sesame Credit was a trial indirectly executed by the Chinese government, we can look forward to the implementation of ‘the real deal’, the actual social system that will go live in 2020.

Conclusion

In conclusion, the episode Nosedive from Black Mirror has opened the eyes to many westerners which regard to the social credit system that is about to be introduced nationwide in China. Despite this more recent revelation, the Sesame Credit, a predecessor to the big fish by the Chinese government has been up and running for four years already and is deemed a success. Customers get assigned with a trustworthiness score and in return get access to many advantages such as discounts or not having to pay deposits at hotels. If this system will work in a punishing fashion has yet to be discovered, but it will most certainly be an interesting development to keep an eye out for.

References

Alibaba Group (2015) Ant Financial Unveils China’s First Credit-Scoring System Using Online Data. Available at: https://www.alibabagroup.com/en/news/article?news=p150128 (Accessed: 7 March 2019).

Botsman, R. (2017) Big data meets Big Brother as China moves to rate its citizens. Available at: https://www.wired.co.uk/article/chinese-government-social-credit-score-privacy-invasion (Accessed: 7 March 2019).

Financial Times (2017) China changes tack on ‘social credit’ scheme plan. Available at: https://www.ft.com/content/f772a9ce-60c4-11e7-91a7-502f7ee26895?mc_cid=9068154611 (Accessed: 7 March 2019).

Hatton, C. (2015) China ‘social credit’: Beijing sets up huge system. Available at: https://www.bbc.com/news/world-asia-china-34592186 (Accessed: 7 March 2019).

Huang, P. (2017) WeChat Confirms: It Shares Just About All Private Data With the Chinese Regime. Available at: https://www.theepochtimes.com/wechat-confirms-it-gives-just-about-all-private-user-data-to-the-chinese-regime_2296960.html (Accessed: 7 March 2019).

Jefferson, E. (2018) No, China isn’t Black Mirror – social credit scores are more complex and sinister than that. Available at: https://www.newstatesman.com/world/asia/2018/04/no-china-isn-t-black-mirror-social-credit-scores-are-more-complex-and-sinister (Accessed: 7 March 2019).

Needham, K. (2019) China: Big Data watches millions during Chinese New Year. Available at: https://www.smh.com.au/world/asia/millions-are-on-the-move-in-china-and-big-data-is-watching-20190204-p50vlf.html (Accessed: 7 March 2019).

Engaging Generation Y to Co-Create through Mobile Technology


In an increasingly more competitive product and service environment, the need to have an ongoing service innovation for companies in order to successfully compete in the market has never been bigger (Bugshan, 2014). A McKinsey report identifies several things to be the cause of this increasing pressure to innovate on service companies, such as big data and advanced analytics, the Internet of Things and the rise of the mobile internet with a skyrocketing offering for mobile self-service apps (Duncan, 2015). The last aspect might not simply be a cause for this effect, but it might also serve as a powerful tool that companies can utilize in their quest to increase co-innovation and value co-creation, especially when looking at the tech savvy Generation Y (born between 1980 and 1994). The work of Zhang, Lu and Kizilag (2017) is examining the motivations of this generation to increase their participation in value co-creation to make better products and services and for companies to remain competitive. Engaging this generation is very importance due to them being close to digital natives and representing a very sizable part of the overall population (22% in the US) (Schroeder, 2018). Even though the next Generation Z (1994 – today) is even more tech savvy, the are often not of age and are hence often not the customers of many products due to their young age.

Why Y?

Why should companies focus on engaging Generation Y in value co-creation activities?

Generation Y is/has:

General facts given by Zhang et al (2017)

  • Tech savvy
  • Stable income
  • Entrepreneurial spirit
  • High degree of social interaction and belonging

Additional facts from a background paper by Halliday & Astafyeva (2014)

  • Drive for entertainment and experience (satisfied by chance to have an impact on a company’s value offering)
  • High need for self-actualization (fulfilled by creating their own version of a company’s product)
  • Prestige (gained due to positive exposure their idea gets if used by company)

The research explores how members of Generation Y can be engaged for co-creation through mobile technologies and what the antecedents of the adoption of mobile technology for co-creation are from innovation theory. Utilizing this can become a primary source of competitive advantage, such as in the case of Made.com an e-retail company that puts the decision of what goes from the drawing board into production in the customers hands and was able to grow by 37% in 2018 due to this co-creation strategy (Neerman, 2019).

To establish what influences the co-creation activities of Generation Y the authors use a diffusion of innovation (DOI) framework and analyze the influence of the technical, social and individual dimension on co-creation activities via mobile technology. The analysis of the responses of 689 Generation Y co-creators via mobile technologies revealed that the most important dimension for them is a social community where they are relying on an interpersonal and peer network and on informal communication with the company and other co-creators. The factors that were found to have a significant positive influence on mobile co-creation activities are visualized in Figure 1.

So what motivates Generation Y customers to engage in value co-creation via mobile apps?

Figure 1: Dimensions and factors having a positive impact on value co-creation by Generation Y, based on research of Zhang et. al. (2017)

Interpersonal networks are consisting of the social environment of a person and the findings suggest that the degree to which this network is present in a co-creation context increases the co-value creating activities due to the social response that the people get.

Peer networks within the DOI framework are examining the closeness of the relationships among co-creators and are contributing to co-creation. The better the relationship, the higher the likelihood to share information, increase interaction to co-create with others due to increased trust and willingness to accept other’s recommendations.

While peer networks create a closeness between different co-creators to share ideas, the research finds out that it is equally important to have a frequent and informal exchange of ideas between the potential co-creators and the company with whom they are engaging. Examples of such an informal communication existed at Lego, where customers were given the ability to interact with each other and Lego through the My Lego Network until 2015 (Fandom, 2019).

The individual dimension, in this study measured by the factor of consumer innovativeness, was found to have a positive impact on the contribution as well, showing that some factors might be beyond the influence of a company, should they try to use this research to build a co-creation strategy.

Interestingly out of the three proposed factors of the dimension of technology, only one (ease of use) was found to be important. Ease of use contributes to the co-creation activities of Generation Y due to its role as a facilitator of the adoption of new technologies, such as the applications that were in scope during this research.

How can companies better engage Generation Y?

To improve the engagement of Generation Y there are several useful findings from this research, that companies can utilize. Entrepreneurial spirit of the targeted customer and ease of use of the applications seem to be important enablers of co-innovation without customer engagement does not work. The real art of value co-creation lies in the building of social communities, were this research has provided very interesting further refinements along which a company can build the social environment to ensure a high degree of customer co-creation. To visualize the varying degree of how appealing online offerings are to generate value co-creation and how they can be improved based on this research, two companies LEGO and P&G will be examined.

P&G the Laggard (per Zhang et al):

  • Has an online offering for value co-creation called P&G Development & Connect
  • Gives the customer access to predefined areas where the company would like the customers to submit their ideas
  • Only one-way communication from the company to customer
  • No informal way of communication
  • No community building with regards to interpersonal networks or peer networks

Improve Generation Y-Activity by:

  • Allow customers to chat with the company in (interpersonal communication)
  • Build a community, where equal minded individuals can share and review ideas (peer and interpersonal network building)

LEGO (text book example (per Zhang et al)):

  • Has 6 different communities each serving a different segment (e.g. LEGO Mindstorms for older customers with tech affinity, LEGO Movie Maker for customers interested in directing and editing film, etc.)
  • These communities are separated to allow the peer groups to be even similar and foster social interaction, trust and collaboration
  • Customers can interact via Twitter and chat to get the thoughts of LEGO employees on their ideas
     

As can be seen by the two examples LEGO has built a very differentiated strategy for customers to interact with them, satisfying all the dimensions found by the research of Zhang et al (2017). P&G has some areas of improvement and it appears that this lag might be due to a focus on an older generation and hence the negligence of factors that are important for the engagement of Generation Y. Yet, as stated previously, even large and established cooperation can benefit from value co-creation from Generation Y and a first step towards this would be to consider the dimensions found by Zhang et al (2017).

Room for improvement

Even though this research provides a very interesting first starting point for academics and practitioners, it is of exploratory nature and has some weaknesses. The study was only conducted among value co-creators, so there is no distinction possible to non-creators. Further the dimensions are very broad and future research especially on the social dimension would be very interesting to fully understand the phenomenon that are taking place and gain insights that can be utilized by practitioners and academics alike.

References:

Bugshan, H. (2014). Co-innovation: The role of online communities. Journal of Strategic Marketing,23(2), 175-186. doi:10.1080/0965254x.2014.920905

Duncan, E. (2015, February). Service innovation in a digital world. Retrieved February 27, 2019, from https://www.mckinsey.com/business-functions/operations/our-insights/service-innovation-in-a-digital-world

Fandom. (2019). My LEGO Network. Retrieved February 28, 2019, from https://mylegonetwork.fandom.com/wiki/My_LEGO_Network

Halliday, S. V., & Astafyeva, A. (2014). Millennial cultural consumers: Co-creating value through brand communities. Arts Marketing: An International Journal, 4(1/2), 119-135. doi:10.1108/am-01-2014-0003

Neerman, P. (2019, February 08). Made.com grows by 37%: “We can afford to fail”. Retrieved February 27, 2019, from https://www.retaildetail.eu/en/news/furniture/madecom-grows-37-we-can-afford-fail

Schroeder, W. J. (2018). Generations X,Y, Z and the Others. Retrieved February 27, 2019, from http://socialmarketing.org/archives/generations-xy-z-and-the-others/

Zhang, T. C., Lu, C., & Kizildag, M. (2017). Engaging Generation Y to Co-Create Through Mobile Technology. International Journal of Electronic Commerce,21(4), 489-516. doi:10.1080/10864415.2016.1355639

Procter & Gamble Corporation: value co-creation through open innovation


This blogpost provides information about the Connect+Develop platform created by Procter & Gamble (P&G). The blogpost by 441485DG (linked below) has also touched upon this subject, however, this post is a more up-to-date and in-depth analysis of how P&G  has been successful in value co-creation through their online platform website.

P&G is one of the largest consumer goods manufacturers, distributors and advertisers worldwide, with more than 65 products and a global reach of 180 countries (Procter & Gamble, 2006).

A short history

P&G was established in 1837 by William Procter and James Gamble, a candle maker and soap maker, respectively (Procter & Gamble, 2006). The company became successful soon: in the 19th century, P&G had several contracts to supply soap and candles to the Union Army during the American Civil War (Procter & Gamble, 2006). In 1930, P&G acquired Thomas Hedley Co, a company based in the UK, which was also the beginning of P&G’s international expansion. After this, P&G made several acquisitions, expanding to a number of different business divisions (Procter & Gamble, 2006). Furthermore, P&G launched a successful range of personal health, grooming, beauty and home care brands (Procter & Gamble, 2006).

However, during the 1990s, the company encountered a reduction in sales growth (Agafitei & Avasilcai, 2015). This was mainly due to their closed business model, where there was no communication with outside partners about the development of novel products (Agafitei & Avasilcai, 2015). Moreover, the company considered its technology a secret, and licensing was rarely done (Agafitei & Avasilcai, 2015). Because of the rise in global competition and the increase in R&D costs, the company decided to switch to a business model with more proactivity (Ozkan, 2015).

Business idea

In order to switch to a more proactive business model, P&G considered co-creation and open innovation. Co-creation occurs when a company brings different people (and parties) together to cooperatively produce a mutually desired outcome (Agafitei & Avasilcai, 2015). With co-creation, the key focus is on the interests of all stakeholders, creating value by continually improving experiences of all stakeholders. The advantage is that co-creation increases engagement with all stakeholders, and that it continuously builds on new interactions and experiences, leading to increased creativity, productivity, lower risks and costs.

According to Lawer (2017), open innovation is a standalone form of co-creation, because it is more distributed and because companies give more control to parties joining the platform. More specifically, open innovation is a way for firms to use the strengths and ideas of people outside their company, in order to improve products or internal processes of the firm (Ozkan, 2015).

Business model

In order to become more proactive, the company launched the Connect+Develop platform in 2001 (Procter & Gamble, 2019). This is an open innovation platform where the company engages with the most innovative minds to deliver on P&G’s opportunities (Procter & Gamble, 2019). The main idea behind Connect+Develop is to create an opportunity for people outside the company to improve current products, and to create innovative ideas for P&G (Agafitei & Avasilcai, 2015). Moreover, outside parties are also able to contribute by solving tricky problems within the company (Ozkan, 2015). In order to simplify and increase engagement with outside parties, P&G launched a Connect+Develop website in 2013 (Ozkan, 2015). The platform can be accessed via https://www.pgconnectdevelop.com/. The website directly links outside parties to the top needs of the company, and P&G management and evaluators directly to user submissions. More specifically, the “current needs” button shows all different needs for different categories. This way, the evaluation process becomes faster, increasing overall efficiency of the platform (Ozkan, 2015). For example, when a user clicks on the current need category “beauty and grooming innovations”, it shows an explanation of the category, and it shows that there are no current needs for it. However, every user is still able to submit his/her innovative idea by clicking on “click here to submit your innovation” (see figure 1).


Figure 1: Current needs – beauty and grooming innovations category

Furthermore, there are several criteria that a user should consider before he/she is able to submit his/her idea, which is also explicitly shown on their website (see figure 2). P&G also states which type of solutions they are not interested in, which can also be found on the “submission criteria” page.


Figure 2: Submit your innovation – submission criteria

Through this online platform, P&G receives a great number of open innovation submissions. These proposals need to be managed and reviewed. In order for this process to work efficiently, the online platform helps P&G by collecting additional data the company needs. Then, the submissions are reviewed by a specific team within Connect+Develop. Approved submissions are then distributed to their relevant business departments for further review (Ozkan, 2015).

Efficiency of the model

Looking at it from a joint profitability perspective, the model works. According to Huston & Sakkab (2006), more than 35% of the company’s new products have elements of the open innovation submissions. Moreover, the success rate of P&G’s innovation has more than doubled and the costs of innovation have reduced (Huston & Sakkab, 2006). Lastly, since 2000, P&G’s stock price had doubled as well (Huston & Sakkab, 2006). From the customer perspective, the Connect+Develop platform has also been beneficial. By co-creating and using the open innovation platform, customers are able to define products they will eventually want to purchase, and they do not have to wait for firms to decide the key elements of a product (Agafitei & Avasilcai, 2015).

Considering the feasibility aspect, the model is a bit less efficient. According to Veer et al. (2015), process coordination costs and implementation costs are high for an open innovation platform. Furthermore, open innovation requires adapting the culture of the company, as there might be a feeling of loss of knowledge control among employees (Veer et al., 2013). Lastly, from a legal point of view, an effect of open innovation might be intellectual property spillovers (Veer et al., 2013). Because of these costs and risks, open innovation requires a lot of research and planning prior to its implementation, which might not be feasible for smaller companies or startups for example (compared to P&G).

All in all, P&G has been able to create an effective value co-creating, open innovation platform. By becoming more customer-centric, the company has increased its number of new products, and doubled its stock price. However, the risks of open innovation should be taken into account before implementing it.

Reference list

Article 441485DG: https://consumervaluecreation.com/2016/03/11/procter-gamble-from-rd-to-connectdevelop-platform/

Agafitei, G. and Avasilcai, S. (2015). A case study on open innovation on Procter & Gamble. Part II: Co-creation and digital involvement. IOP Conference Series: Materials Science and Engineering, 95.

Huston, L., and Sakkab, N. (2006). Connect and develop: inside Procter & Gamble’s new model for Innovation. Harvard Business Review. Retrieved from https://hbr.org/2006/03/connect-and-develop-inside-procter-gambles-new-model-for-innovation

Lawer, C. (2017). Eight Styles of Customer Value Co-Creation. Retrieved from https://www.umiohealth.com/media/2309/eight-styles-of-customer-value-co-creation.pdf

Ozkan, N. N. 2015. An example of open innovation: P&G. Procedia—Social and Behavioral Sciences 195:1496–502

Procter & Gamble. (2006). A company history. Retrieved from https://www.pg.com/translations/history_pdf/english_history.pdf

Procter & Gamble. (2019). What is connect and develop? Retrieved from https://www.pgconnectdevelop.com/what-is-connect-develop/

Veer, T., Lorenz, A., and Blind, K. (2013). How Open Is Too Open? The “Dark Side” of Openness along the Innovation Value Chain. Paper Presented at the 35th DRUID Celebration Conference, Barcelona, Spain, June 17–19.

Name: Berna Hizli
Student number: 408455

Netflix’s personalization taken to a whole new level?


When it comes to personalized recommendations, Netflix is a well-known player. Browse to Netflix and the first thing you see at the homepage is content adjusted to your interests, preferences and previously watched series and movies. The banner, carousels, the order of the shows, the text and the search: everything is personalized. These “recommendations for you” are not something new or special as you might think. Indeed, Netflix is not the only one who made personalization an important part of their business strategy. However, Netflix has recently stepped up their game when it comes to personalization.

By the end of 2018, Netflix announced that viewers will be able to choose the next storyline in an episode of a TV show or movie. On December 28th, Netflix released a 90-minute episode of Black Mirror: Bandersnatch. During different moments in the movie, the viewers get to decide how the story will continue. Is this the new innovative idea when it comes to customer experience and personalization?

Netflix as a well-known player in the market

Netflix is one of the first companies that saw the potential of streaming technology. Since 2007, when the company started with a subscription video-on-demand model, the service has reached over 130 million users in 2018 (Statista, 2019). According to Gomez-Uribe & Hunt (2015) an important aspect of the service of Netflix is the recommender system. Through the recommendation systems the users of Netflix can easily find videos to watch in every session.

Gorgoglione et al. (2019) argue that recommender systems are of strategic importance for online businesses. Recommendation systems refer to “web-based tools that tailor vendor’s offerings to consumers according to their preferences” (Li & Karahanna, 2015). The value of this personalized offerings can be seen in the fact that 80% of hours streamed by the customers of Netflix are determined by their recommendation algorithms (Gorgoglione et al., 2019). Since there are several kinds of recommendation engines with different performance metrics such as accuracy, novelty, diversity and trust, Netflix tries to search for the best algorithm (Gorgoglione et al., 2019. Next to this, Netflix is trying to handle issues related to the increasing number of customers and especially how to handle enormous stream of big data.  

“The personalized homepage of Netflix”

A new interactive viewing experience

One of the ideas Netflix recently incorporated, is thus a new interactive viewing experience for the users of Netflix. As this idea is not completely new and Netflix already offered this experience with children shows, the movie “Bandersnatch” is the first interactive show for adult viewers ánd the first big success within this format. Bandersnatch is a 90-minute episode of the Netflix series Black Mirror. Black Mirror is known for its critical commentary on technological developments and its impact on culture and society. In Bandersnatch, the viewers guide the protagonist Stefan through the episode by making a series of decisions (Ralph, 2019). These decisions influence Stefan’s life, experiences and mental state and result in different endings. The decisions that the viewers need to make differ from choosing between what Stefan has to eat for breakfast (Frosted Flake or Cheerios) or whether he has to jump off a balcony (Ralph, 2019).

“One of the choices in Black Mirror: Bandersnatch”

What is the value for Netflix?

What is interesting about this business model is that this form of interactive experience offers new data insights for companies such as Netflix. According to Damiani (2019), Netflix uses the gathered data from the user participation to create an internal programmatic marketing infrastructure. Since the viewers need to make real-life decisions about for example their product preference (such as the choice between the cereals), musical taste and engagement with human behavior, an individual personalized pattern can be discovered. Moreover, how users handle certain decisions (for example if Stefan has to jump off the balcony) offer insight about what the viewers want out of a story and what they want to see the characters in a story do (Damiani, 2019).

By analyzing this data, Netflix could even better personalize the content, but also associate products with specific content or demographics. An example that Damiani (2019) mentions is that the frosted flakes cereals could be associated with, for example, 18 to 24 years old men. This way, effective targeted advertising could take place. Another interesting part of the business model is that Netflix could work together with different brands to test their product designs. Think of the already described example of the breakfast cereal boxes as shown to the viewer with two different box covers.

What’s in it for the customer?

But what is the efficiency of the business model? What is the value for the customer? First of all, the experiences of the series are tailored to the needs and interests of the customer. Each customer has an individual and unique experience as they have to choose between different narratives. Moreover, it is interesting that in the example of Bandersnatch, the customer experiences a sense of power and control. Research have shown that increasing user experience increases user’s confidence in their ability to perform their tasks (Nysveen & Pedersen, 2004). By choosing between different options and determining how the story will unfold, the customers are in charge and can make the choices for themselves.  

It is interesting that the joint profitability of this business model is visible to both the customer and Netflix. With the interactive experience and thus through active customer participation and engagement, Netflix tries to uncover the hidden needs of the customers. As a result, Netflix can use this creative potential of their customers in new product and service development (Saarijärv et al., 2013). What is striking is that Netflix in fact guides the customers through different predefined choices creating the ‘illusion of free choice” (Ralph, 2019). Customers get the feeling that they are in control in the sense that they can literally determine whát and how they experience the content. Moreover, customers engage in personalized and unique experiences and eventually receive more content tailored to their preferences. Thus, through active customer participation the customers and Netflix together create greater value. However, the future will tell if this idea will pull off and will be long-lasting.

References

Damiani, J. (2019). Black Mirror: Bandersnatch could become Netflix’s secret marketing weapon. Retrieved 23-02-2019 from https://www.theverge.com/2019/1/2/18165182/black-mirror-bandersnatch-netflix-interactive-strategy-marketing.

Gomez-Uribe, C., & Hunt, N. (2015). The Netflix Recommender System: Algorithms, Business Value, and Innovation. ACM Transactions on Management Information Systems, 6(4).

Gorgoglione, M., Panniello, U., & Tuzhilin, A. (2019). Recommendation strategies in personalized applications. Information & Management.

Li, S., & Karahanna, E. (2015). Online recommendation systems in a B2C E-commerce context: a review and future directions. Journal of the Association for Information Systems, 16(2), 72-107.

Nysveen, H., & Pedersen, P. (2004). An exploratory study of customers’ perception of company web sites offering various interactive applications: moderating effects of customers’ Internet experience. Decision Support Systems, 37(1), 137-150.

Ralph, A. (2019). What Black Mirror: Bandersnatch teaches us about personalization. Retrieved 23-02-2019 from https://www.heyday.ai/what-black-mirror-bandersnatch-teaches-us-about-personalization/.

Saarijärvi, H., Kannan, P., & Kuusela, H. (2013). Value co‐creation: theoretical approaches and practical implications. European Business Review, 25(1), 6-19.

Statista. (2019). Retrieved 23-02-2019 from https://www.statista.com/topics/842/netflix/.


The future of auditing and market research through crowdsourcing (Business case – BeMyEye)


Context

Auditing and market research are important for companies to get an insight into how they perform in the market. When doing an audit suppliers often check if retail stores keep to the agreement which they make, such as the display of a product for instance. With market research companies gather deeper insights about costumers’ needs and preferences, to be able to make strategic decisions for the future. Although both insights are valuable for companies, these methods are not always practiced due to their high costs.

Unique proposition of the business idea

BeMyEye is a research company that offers a platform where companies can obtain street-level data from physical stores, through crowdsourcing. Within this platform, these companies, which are called the ‘clients’, offer tasks to the users of the platform. This obtained data is used the clients in various ways such as; to check whether stores are fulfilling their arrangements, how prominent their products are being displayed, how much stock there is still available from a particular product, and to collect street-level data for mapping enrichments or to identifying new opportunities for the company. This type of crowdsourcing is called information pooling. Within this type, contributions are characteristically identical and the crowd is usually asked for their opinions or to gather location-based information (Blohm, Zogaj, Bretschneider & Leimeister, 2018). This revolutionary way of auditing and market research is interesting for companies because it has a high degree of reliability and is much more efficient and cheaper than current methods. This reliability is partly obtained by deliberately allocating the tasks among a large group of people with both customers and non-customers of the product. Customers who also use the product, to which the task relates, could be positively biased when they provide the client with their perceived data, because they could be a huge fan of the brand.

Promotion video BeMyEye

BeMyEye’s business model and how it works.

BeMyeye uses a two-sided platform. On one side of the platform are the companies which offer various tasks which they call ‘clients’. Examples of well-known clients include Nestle, Samsung, Heineken, Lavazza, and Coca Cola. And on the other side are the BeMyEye app users which are called ‘the eyes’, these eyes could be described as ‘secret shoppers’. As soon as the clients need information about certain things in the market, they write a task and set a reward for completing this task. When the consumer logs in on the app on his phone, he sees where there are tasks in the vicinity of his current location and which rewards have been allocated. Assignments often include submitting photos of certain shop displays and completing a corresponding questionnaire. One of the newer tasks that can be assigned on BeMyEye is checking your brand reputation. Here, the eyes reveal the preferred brand choices and reasons of influential retail staff, such as a pharmacist, when approached by customers. When eyes start with an assignment, they check with their current location at the destination of the task as proof that they are in the right place, then they answer the questions the app asks them (O’Hear, 2018). These questions function as a step-by-step guide to be able to standardize the collation of the data which the clients receive. Fees usually vary from three to sixteen euros depending on the duration and level of difficulty of the assignment. After the assignment has been carried out, it needs to be verified, and when everything is fine, the eye will receive his reward and will be paid directly. In this way, companies can quickly obtain data from multiple geographical locations and no longer have to hire auditors who physically go to stores, which is often time-consuming and inefficient. In this way, companies can reduce their related costs, which can significantly improve their ROI for these business activities. This is an interesting concept for the eyes because they can quickly earn some extra money while already being at a certain location. BeMyEye earns money within this concept through a certain fee per completed assignment that they receive from the companies.

Appearance BeMyEye app

The rapid growth of the company and future use of their products

BeMyEyes now has more than 1.5 million active data gatherers in more than 21 countries and are currently the largest crowd of real-world data gatherers in Europe. In order to enlarge the network, BeMyEye uses an aggressive strategy to quickly obtain more data gatherers. They do this by offering people a new way to earn something in a fun way, and by acquiring similar business models that have large numbers of active users.  They started with this strategy in 2016 when they acquired Local Eyes, which was a similar French mobile crowdsourcing app. Shortly after that, they acquired other competitors such as Task360 in 2017 and Streetbee at the start of 2019 (O’Hear, 2019). With these acquisitions, they did not only take over the business models and users, but also the supporting employees, who helped the company grow even faster due to shared knowledge. These acquisitions are financed with money that the company has raised in several new financing rounds. Now, the company’s biggest focus is to maintain its market position in Europe and to enter the US market to further expand its platform (Kharpal, 2016).

Nowadays, most questions the eyes get while performing a task are easy to answer and do not require any knowledge about the products. However, the question is how far could BeMyEye go. To what extent are ‘normal’ people capable of answering questions that need a certain level of interpretation or expertise? And how can BeMyEye guarantee that the questions which are asked to the eyes are correctly interpreted?

I think this way of auditing will become the standard for consumer products in retail stores because of its efficiency and low costs.  However, it should be examined in the future to what extent ‘normal’ people can be used for these tasks, or how they possibly could be trained.

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Sources

Blohm, I., Zogaj, S., Bretschneider, U., & Leimeister, J. M. (2018). How to manage crowdsourcing platforms effectively?. California Management Review, 60(2), 122-149.

Kharpal, A. (2016, May 19). BeMyEye, an ‘Uber for mystery shoppers’ app raises $7.2M and eyes US expansion. Retrieved February 23, 2019, from https://www.cnbc.com/2016/05/19/bemyeye-an-uber-for-mystery-shoppers-app-raises-72m-and-eyes-us-expansion.html

O’Hear, S. (2018, January 16). BeMyEye, the startup that lets companies crowdsource in-store data, acquires rival Task360. Retrieved February 23, 2019, from https://techcrunch.com/2018/01/16/bemyeye-task360/?guccounter=1

O’Hear, S. (2019, January 16). BeMyEye acquires Streetbee, a Russian crowdsourcing and image recognition provider. Retrieved February 24, 2019, from https://techcrunch.com/2019/01/16/bemyeye-acquires-streetbee-a-russian-crowdsourcing-and-image-recognition-provider/

How PSD2 is changing the financial industry


After the development of Internet Banking, and Mobile Banking, the European Union has now paved the way for Open Banking. ‘Open Banking’ is the relatively new umbrella term for opening the bank to other parties to access customer data (Courbe, 2018). The Payment Service Directive (PSD), enforced in 2007, is revised recently with the aim to stir innovation and emphasize consumers’ protection by increasing security and transparency through enhanced know-your-customer capabilities, identity validation, and fraud detection (Brodsky & Oakes, 2017). The new European legislation: ‘The Payment Service Directive 2 (PSD2)’, which became applicable in January 2018, sets the banking industry into motion by shifting the authority to share data from financial institutions to bank customers by the rule of: access to account (European Commission, sd). Under PSD2 large financial institutions may move towards the background, maintaining the back-end systems, where digital “giants” are able to extend their close customer relationships by fulfilling the specific customer needs by adding digital value-added services on top of the bank, leading to more competition, digital payment methods and lower transaction costs for consumers (McKinsey, 2016). These digital ‘giants’ like  Amazon and Google, are now able to directly access bank customers and collect the final piece of data that was not accessible before. This could lead to end-to-end solutions that complete the circle of services offered by these parties (PWC, sd).

The Payment Service Directive 2 (PSD2)

Two new categories of licences are created: the Payment Initiation Service Providers (PISPs), which enables third parties, if permission is granted, to directly initiate payments at the bank on behalf of the customer; and the AISP (third party account information service providers), multiple accounts of various banks can be combined into one interface (Deloitte, 2016). By establishing a single legal framework for payments within the EU, cross-border payment transactions can be made as easy, efficient and secure as the domestic payments in Europe (European commission, sd). In this way, the directive lowers entry boundaries of the payment market and thus competition increases. Efficiency is reached by standardization of rules, which results in lower transaction costs and improved financial services. Though, new entrants must meet strict technical requirement set by the European Banking Authority. The customer-centric legislation aims for increased security and transparency of Third-Party Service Providers (TPSPs) as well as banks towards customers. Newly non-banking solutions can be offered as well; payments via digital channels such as social media (Noctor, 2018).

By giving Third-Parties their consent, customers have to trust the Third-Party first, but consumers may not be able to assess the same value and sensitivity to certain data elements as banks and regulators do (Brodsky & Oakes, 2017) as they can be blinded by the benefits that a certain payment service of a TPSPs provides. Thus, the customer-centric regulation results in a cost-benefit trade-off concerning the ability to utilize more efficient and improved bank services, while putting one’s own privacy at risk. New consumer-payments relationships in the financial industry raises the need for a better understanding of how to build consumer trust over the internet. Are bank customers willing to share their personal financial information with TPSPs in return for improved financial services or personalized financial applications? In other words, do the benefits outweigh the risks of sharing your financial data? The following paragraphs explain the advantages and disadvantages of the PSD2 along with related developments in banking.  

Personalization of the financial industry

In today’s world, personalization in e-commerce is rather a must than a nice to have. The future of the financial industry will follow the e-commerce sector by responding to the financial needs of consumers through new types of payment services delivered by Third-Parties’ interfaces on top of banks’ existing data and infrastructure. The PSD2 enables, for example, PayPal to provide additional services on top of the banks infrastructure in which the bank customer barely interacts with their own banking institution. This can threaten banks since PayPal can access multiple bank accounts of bank customers, if consent is given, and can thus collect more information on customers. The information can then be used to fulfill the customers’ needs. In this way, banking services can be offered in a more personal way. In contrast to banks, Third-Parties have the benefit that they can specialize on specific needs of consumers since they do not have the burden of meeting all of the needs of the consumers (Deloitte, 2016). Though, Third-Parties still need to be granted access to the banks’ interface through API’s (Application Programming Interface) provided by financial institutions to interact with bank accounts to third-parties. Although the customer centric, mobile and swift nature of TPSP services is in conflict with how banks traditionally operate, banks have the opportunity to differ between basic and advanced API’s in order to generate a new stream of revenue. Banks expect to face the most significant challenge, not from new digital banks or fintechs, but from the consumer tech giants such as Google, Facebook and Apple. Apart from the end-users’ financial information, these firms were able to access almost every other part of personal information that is available on the internet.

Another important element of banks is their reputation and institutional trust that they have gained over the years. Though, the image of some banks have been harmed in the past years (Volkskrant, 2018), banks do invest heavily in security because their reputation is at stake. TPSPs on the other hand, do not possess a similar security foundation because it was not possible to access bank customers’ accounts or initiate payments on behalf of the customer. However, in the online context, uncertainty increases as users are not aware of the consequences associated with sharing of personal financial information, including account information, obtained financial services and transaction data. Consumers are not likely to share highly sensitive data because of perceived privacy concerns that are due to the invisible nature of the online environment (Culnan & Armstrong, 1999). Thus, e-commerce and consumers are confronted with more payment options, but this does not necessarily benefit to the level of confidence in the payment system, because too much fragmentation of providers can also increase uncertainty and therefore uncertainty among consumers. Then again the conversion at online retailers can have a negative effect in addition to potential market saturation and regulatory burdens which can become another challenge for TPSPs. (Deloitte, 2016). The customer-centric legislation may in the end not be so customer-centric concerning the potential market saturation and the corresponding privacy concerns in the uncertain online environment.

The rise of ‘Digital Giants’ in banking

Currently Google has its primary payment method Google Pay which is a digital wallet that offers a limited number of financial services. As of january 2019, Google has been granted the new payment license in Ireland and Lithuania (Finextra, 2019), which enables them to access bank customers’ account and initiate payments on behalf of the bank customers Although Google did not publish any new service ideas yet, efficiency gains can be made by providing convenient interfaces and features that banks do not offer. These potential services can be combined or linked with existing products, resulting in end-to-end solutions. In this way digital giants are empowered to complete the circle of services offered by these parties. In sum, banks have their brand image and the in-house security foundations as strategic assets, whereas Third-Party Service Providers (TPSPs) have the flexible nature to adapt quickly to customers’ needs. Instead of entering the red ocean, banks can leverage their assets and strengthen their position by collaborating with fintechs and digital giants. Especially, in the uncertain online environment where risk is inherent, trust becomes an important factor. Collaboration is thé solution in the customer-centric world of today. Google has already announced that they prefer to work with banks instead of continuing by themselves. Under the PSD2, Europe puts the customer first and customer protection is number one priority. It is a starting point for change in the traditional financial industry.

References

Brodsky, L. & Oakes, L., 2017. Data sharing and open banking. [Online] Available at: https://www.mckinsey.com/industries/financial-services/our-insights/data-sharing-and-open-banking [Accessed 18 february 2018].

Courbe, J., 2018. Building ‘Open Banking’ on a Platform of Trust. ABA BANKING JOURNAL , pp. 38-39.

Culnan, M. J. & Armstrong, P. K., 1999. Information Privacy Concerns, Procedural Fairness, and Impersonal Trust: An Empirical Investigation. Organization Science, 10(1), pp. 104-115.

Deloitte, 2016. Anticipating the challenges and opportunities of the PSD2. Inside, June, pp. 60-65.

European Commission, n.d. Payment services. [Online] Available at: https://ec.europa.eu/info/business-economy-euro/banking-and-finance/consumer-finance-and-payments/payment-services/payment-services_en [Accessed 18 february 2018].

Finextra, (2019). Google gets payments licence in Ireland. [Online] Available at:https://www.finextra.com/newsarticle/33167/google-gets-payments-licence-in-ireland [Accessed 22 february 2019].

McKinsey, 2016. Technology innovations driving change in transaction banking. [Online] Available at: https://www.mckinsey.com/industries/financial-services/our-insights/technology-innovations-driving-change-in-transaction-banking [Accessed 18 february 2019].

PWC, n.d. PSD2 stimuleert slimme authenticatiemethoden banken. [Online] Available at: https://www.pwc.nl/nl/themas/blogs/psd2-stimuleert-slimme-authenticatiemethoden-banken.html[Accessed 17 february 2018].

Volkskrant, (2018). Ministers wil schandalen zoals bij ING voorkomen en scherpt beloning van bankiers verder aan. [Online] Available at: https://www.volkskrant.nl/nieuws-achtergrond/minister-wil-schandalen-zoals-bij-ing-voorkomen-en-scherpt-beloning-bankiers-verder-aan~b37cfd78/?referer=https%3A%2F%2Fwww.google.com%2F[Accessed at 22 february 2019]


Symbaloo: from homepage website to educational tool


Symbaloo is an internet based company with 15 million users whose product is a homepage. On Symbaloo, people can click tiles that link them to their favorite websites or generate helpful tools on the website itself. People can choose to either use the standard homepage or to customize their own page (Symbaloo, 2019).

symb1
The (dutch) standard homepage of Symbaloo

The unique value that Symbaloo offers to their customers is defined in two terms: simplicity and customizability. Symbaloo mostly targets two groups of people. Firstly, the digital immigrants. This group consists of the more elderly people who have a rough time navigating the internet, who are mostly appealed by the simplicity of the website. Secondly, the digital natives. This group consists of younger people who are already sufficiently experienced with the internet and are more appealed by the customizability and the visibility of the website. (Prensky, 2001)

Symbaloo has to thank most of its users to customer centricity. Symbaloo has put a lot of effort in understanding who their customers were, why they were using Symbaloo and what the most important value was. This centricity was eventually the most deciding factor for most of the digital immigrants, who had trouble getting started on the internet by themselves. Symbaloo acted as a fallback for when users had troubles with using the internet, resulting in a lot of interactions by phone or by email.

The business model of Symbaloo consists of four different aspects:

  1. The tiles at the homepage are sold to advertisers. Although it wasn’t specified that these tiles were sponsored, the tiles were highly successful, regardless of the fact that they were promoted by a biased recommendation agent.
  2. Symbaloo sells PRO accounts for a fee, which offer more functionality than the free standard accounts
  3. The searches in the google search engine (in the middle of the page) generate referrals for which advertisers pay (through google). This search engine also contains sponsored recommendations, which are displayed as natural results and were also equally successful as other search results, regardless of being promoted by a biased recommendation agent. The working of the tiles and the search engine contradict the results of the research by Wang, Xu and Wang, who mention that the sponsorship should probably have been disclosed. (Wang, Xu & Wang, 2018).
  4. The wallpaper in the background, which either displays a beautiful picture or an advertisement .Personalized information was used to decide who gets shown what wallpaper. For example, some wallpapers were only shown to either males or females. It was not disclosed that this info was used, but it did lead to higher click to rates per view than when the advertisements were not personalized, which somewhat contradicts the research of Aguirre et al. (2015).

symb2
The homepage of Symbaloo with a (personalized) advertisement in the background

The business model of Symbaloo works well on the short term, but is not sustainable on the long term. As time goes on, the amount of digital immigrants will reduce and the amount of digital natives will increase, which means that the advertisements and the unique proposal they have now will have to be changed. The problem with the business model as it is now, is that most digital natives have little desire to use a homepage other than the standard google or bing for example. For the digital immigrants, Symbaloo offered simplicity, which was a necessity for some to be able to properly browse the internet. However, as digital natives do not experience the same limitation, the value of that simplicity becomes far less. In other words, the growth of the homepage of Symbaloo has stagnated. (Prensky, 2001)

The workings of the business model become more visible when looking at the BCG matrix. The BCG matrix is a matrix in which products are placed in any of 4 areas, defined by the dimensions market share and market growth. For Symbaloo, the homepage would be a cash cow, as they have quite a lot of users, but the growth has stagnated as mentioned before. Because of the lack of growth, Symbaloo is in danger of going out of business. In order to survive on the long term, Symbaloo has ventured into an entirely new branch: education. Symbaloo is looking to use their existing environment, userbase (a lot of users were educational users) and current knowledge in order to become a big party in online education environments. At the moment, the educational application is still starting up and growing fast (question mark on the BCG matrix), which requires a lot of investments. These investments were funded by the earnings of the homepage. (BCG, 2014)

bcg
The BCG matrix

Symbaloo nowadays offers two unique propositions to the educational world. The educational product (http://www.lessonplans.symbaloo.com) offers crowdsourced content creation in the form of lesson plans, which become available online. These lessonplans are about a single subject, i.e. Napoleon, Vulcanism, or Microsoft PowerPoint, and are created and used by the teachers themselves. The lessonplans are crowdsourced and marketed as such, which according to Nishikawa et al. (2017) increased its performance. Besides that, there is also the customizability. Symbaloo sells packages to schools, which allow them to fully integrate created lesson plans and other learning environments into their own single Symbaloo page. In other words, Symbaloo creates a personalized product for each different customer, which has proven to be very valuable to schools and school communities all around the world.

The story of Symbaloo includes both success and failure. Where the original product and their original value have been mostly deprecated, the expertise and developed environment have remained very relevant in the value that Symbaloo offers to their customers nowadays. Customizability and crowdsourced content creation are the two pillars on which Symbaloo continues to thrive nowadays. The company is one of the many examples that have shown the importance of customer centricity nowadays and its effects on the fate of companies.

 

Sources:

Aguirre, E., Mahr, D., Grewal, D., de Ruyter, K. and Wetzels, M. (2015). Unraveling the personalization paradox: The effect of information collection and trust-building strategies on online advertisement effectiveness. Journal of Retailing, 91(1), 34-49.

Boston consulting group. (2014). BCG Classics revisited: The growth share matrix. Retrieved from https://www.bcg.com/publications/2014/growth-share-matrix-bcg-classics-revisited.aspx

Nishikawa, H., Schreier, M., Fuchs, C. and Ogawa, S. (2017). The value of marketing crowdsourced new products as such: Evidence from two randomized field experiments. Journal of Marketing Research, 54(4), pp.525-539.

Prensky, M. (2001). Digital Natives, Digital Immigrants. On the Horizon,  NCB University Press, 9 (5), October 2001.

Symbaloo, (2019). What is Symbaloo? Retrieved from https://en.help.symbaloo.com/portal/kb/articles/what-is-symbaloo-22-2-2018

Wang, W., Xu, J. and Wang, M. (2018). Effects of Recommendation Neutrality and Sponsorship Disclosure on Trust vs. Distrust in Online Recommendation Agents: Moderating Role of Explanations for Organic Recommendations. Management Science, 64 (11), 5198-5219.

 

Note: most of the information about Symbaloo, their business model, history and way of working is based on my experience of working there (2017), of which there is no online source available.

Written by: Oskar Sabel, 414014os

A potential for consumer value creation: Citymapper


Introduction
Founded in 2012 by Azmat Yusuf (Tanasoiu 2018), Citymapper is a UK-based company which aims to transform the transportation industry. Through its application, Citymapper helps its user navigate a given city’s transportation grid and provides users with the ability to search for the desired destination, after which the app displays a number of travel itinerary alternatives. Since its inception in 2012, Citymapper has grown internationally and currently operates in 39 cities around the globe (Citymapper 2018). The company creates value for its user by providing them with a travel companion that generates personalised travel options.

But can the consumers become of more value for Citymapper by creating value other than Citymapper capturing their value through the search engine?

Current business model
Citymapper’s currently offers value in the form of efficiency and usability to the users of its transit application. The company exploits its current IT infrastructure, collected data and easy to use user interface to deliver digital content to consumers. On the digital business model framework (Weill et. al 2013) Citymapper’s business design and knowledge of the end customer most closely correlate with the supplier business model.

One way information stream

Citymapper currently gathers partial knowledge of the end users such as search and location (start and end point) data (Citymapper 2018). Other data such as name, address, demographics or search history are not being collected. Therefore, the main information stream flows through the Citymapper application to the user.

Potential consumer value creation
Citymapper can capture a great deal of value by giving its users the ability to co-create value for the application. This can be done by allowing users to give inputs, that are in turn shared with the rest of the Citymapper users. In the current situation, Citymapper supplies users with information about public transport and allows users to plan their public transport trips. The urban transport information shared by Citymapper is limited to the information that is supplied by large public transport companies or private companies gathering transport data. Citymapper has the option to turn their business model from a supplier model into a two stream model.

Two stream business model

How can consumers co-create value for Citymapper?
By starting to use one of their greatest assets they have, a large user-base. Citymapper has the possibility to crowdsource the rating system and the supply of information to their customers making it possible to better understand and support their own customers. Not only are they able to deliver more precise and real-time data on transportation and planning, but also they get more insights in the demands and needs of their own customers. A few of many options that can be crowdsourced are listed below.

The crowdedness of the vehicle
Users could indicate the crowdedness of a particular vehicle signaling that there are no seats available, encouraging users to opt for a different train. Other users could be notified while they are still at home about the crowdedness of the trip, and come prepared, saving them from the surprise of a crowded train, which is one of the greatest pain point related to public transport, according to Fellesson and Friman (2008).

Unexpected delays during the trip
Users could indicate unexpected events that would delay the trips. This live information can be sent to other users, notifying them that the vehicle will be running late, and suggesting an alternative trip. This is all done much quicker than first having to signal the transit company, which in turn must notify users through the rail stations.

Supplier reliability & comfortability
Users could rate transportation providers on their service, both looking at reliability and comfortability. By rating cleanliness, politeness of the driver and price/quality consumers get insights in the overal quality of the transportation modes. This would help other users to select their company of choice.

By gaining more knowledge on what the users, both as a whole and individually, like and demand recommendations can be given. For example, someone who never uses the bus does not want to have the bus in their itinerary. By receiving ratings of services, crowdedness and delays better recommendations can be made. Even more interesting, customers create recommendations and insights for other users, creating a C2C environment.

In order to improve the customer experience for Citymapper users, an in-app payment system could be introduced as well as a ticket management feature. These additions to Citymapper’s value proposition effectively introduce two additional steps in a typical user journey: Once a given user has gathered the desired information regarding his public transport itinerary, instead of leaving the Citymapper ecosystem, the user is given the option to directly purchase the tickets corresponding to the selected journey. Furthermore, once the ticket purchase is completed, tickets are stored within the ticket management feature of the new Citymapper app. This enables the user to remain within the company’s ecosystem throughout the physical public transport journey, using the app as a digital ticket. Overall, the addition of in-app ticket purchase coupled with the ability to use the app itself as a digital ticket greatly improves the overall customer experience while increasing the time a given user spends within the Citymapper platform.

Additional options
Multiple other options open up when turning Citymapper into an open platform environment. By adopting one of many other open platforms for ride sharing and including them into the transportation itinerary would really turn on consumer value creation. Imagine the option to join someone in the car, scooter or motorcycle for a part of your trip. Think of what would happen when Citymapper includes Blablacar, Snapcar, Felyx, Lime, Mobike, Car2go and many others in their system. The options to travel from A to B would become endless.

References:

Citymapper (2018) Making Cities Usable. Citymapper.com. Available at: https://citymapper.com/company?lang=en  

Crunchbase, 2018. Available at: https://www.crunchbase.com/organization/citymapper-limited#section-investors

Weill, P. and Woerner, S. (2013). Optimizing your digital business model. MIT Sloan Management Review, 54(3), pp.71-78.

Fellesson, M. and Friman, M. (2008). Perceived Satisfaction with Public Transport Service in Nine European Cities. Journal of the Transportation Research Forum, 47(3), pp.93-103

Pinduoduo – “Chinese Groupon”: the fastest growing challenger in China’s e-commerce market


Context

The Chinese e-commerce market is dominated by large players such as Alibaba and JD.com who hold nearly 75% of the total market share. Newer players often struggle to enter the market due to intense competition, but a new player called Pinduoduo has managed to claim the third spot in the e-commerce market and is the fastest growing e-commerce app in China (see figure 1 and 2). In a short period of time, Pinduoduo acquired a market share of roughly 5% (Financial Times, 2018) and achieved 100 billion RMB annual merchandise sold in two years after launch (Graziani, 2018). Data from December 2017 indicate that 50% of all users that uninstalled Taobao (owned by Alibaba) moved to Pinduoduo (Dailypanda, 2018), marking Pinduoduo is a potential threat if left unchecked.

Figure 1. Average Monthly Active Users (MAU) from March 2017 until June 2018. Retrieved from: Financial Times (2018).
Figure 2. Largest Chinese e-commerce App by Monthly Active Users (MAU) in January 2018. Retrieved from: Graziani, T. (2018)

Introduction – Pinduoduo and its business model

Pinduoduo was found in September 2015 in Shanghai by former Google engineer Zheng Huang and is a third-party social commerce platform that focusses on connecting manufacturers, suppliers and retailers with end-consumers in the B2C market. The platform earns revenue from collecting commission fees and online marketing services including advertising. Pinduoduo’s platform distinguishes itself from its competitors by providing users the option to conduct “team purchases”. The concept of team purchase is similar to Groupon’s “group buy” (see blogpost of Hsuchiachenjenny (2014) for a brief introduction). Users can invite friends through other social media platforms to create a “shopping team” and order discounted items together in bulk (see figure 3 and 4). Team purchases allow consumers to receive discounts as much as 90% off on products ranging from T-shirts to smartphones. The platform sold more than 4.8 million umbrellas at 10.3 RMB (1.51 USD) per piece and 6.4 million units of tissue paper at 1.29 RMB (0.19 USD) per box (Lee, 2018). Users mainly benefit from Pinduoduo due to getting products at a lower price, while suppliers are enabled to benefit from reducing inventories and generating revenue from aggregation of demand.

Figure 3. Steps to conduct team purchasing at Pinduoduo’s platform. Retrieved from: Fung Business Intelligence (2018)

Figure 4. Pinduoduo’s interface. Source: Fung Business Intelligence (2018)

Pinduoduo’s unique value: user engagement – more than just financial stimuli!

Pinduoduo uses financial stimuli to encourage consumers to help them expand the user base. For instance, convincing one person to install the app and sign in with WeChat will be rewarded with a box of candy and convincing nine people will grant you 1.3 kg of nuts (Graziani, 2018). While financial incentives motivate people to act, academic research (Burtch, Hong, Bapna & Griskevicius, 2018) argue that including social norms are more effective at motivating intensive effort. The social norms refer to “the prevalence of a behavior in a relevant population, such as the number of individuals who already have written reviews” (Burtch, Hong, Bapna & Griskevicius, 2018). Their study pointed out that financial incentives encourage people to write product reviews, while social norms are better to stimulate people to write longer reviews. A combination of financial benefits and social norms are posed to be the best driver of quantity and quality of writing reviews.

Drawing the link with Pinduoduo, we see that the company incorporates the concept of social norms in its business model. Pinduoduo’s application is gamified and includes a public leaderboard that ranks people based on the money they have made out of inviting friends and displays the number of friends they invited. This aspect allows its users to compare themselves with other people and creates a social motivating factor that goes beyond a mere financial stimulus. The appeal of Pinduoduo lies not merely in its low prices but comes from the satisfaction and the pleasure one receives from getting a good deal (Pandadaily, 2018). Therefore, the inclusion of a social motivating factor alleviates its dependence on the constant input of money to incentivize its users. Instigating users to act as brand ambassadors motivated by both financial and more importantly social benefits is a major success factor that allowed Pinduoduo to establish a large user base in a short period of time.

Are Pinduoduo and Groupon the same?

At the time Groupon emerged in 2008, social media and mobile was less entangled with people’s daily lives than in the current situation. Desktop usage, email newsletters, and credit card payments posed limitations on Groupon’s social commerce potential. In 2013, Groupon has dropped its group buy feature and has lost its status as a social commerce platform. The main difference with Groupon’s business model is that Pinduoduo’s business model leverages the social ecosystem in a more effective way. Tencent has been a principal shareholder of Pinduoduo since February 2017 and facilitated the integration of Pinduoduo’s platform with its own social media. Integration with WeChat (an all-inclusive social media app sharing characteristic of Facebook, Twitter and Whatsapp with Paypal functionality) allows fast and real-time communication between users and enables users to make payments with little effort. At this point of time, it is evident that Pinduoduo has surpassed Groupon’s ability to leverage the social ecosystem to establish the consumer base that it has now.

Figure 5. Difference between Pinduoduo and Groupon in user engagement.

The challenges ahead

Viewing Pinduoduo’s success in motivating users to spread the word and persuade their friends in using the app, the company however reported an annual loss of 525 million RMB (77.5 million USD) in 2017 (Fung Business Intelligence, 2018). The current strategy is focused on a push strategy and faces high costs in building brand awareness of the platform. The platform is however plagued with fake products similar to its rival Taobao and JD.com (Lee, 2018). Other questions concern to what extend product suppliers are willing to tap into the platform, as the platform highly focuses on price and pays little attention to brand awareness of its suppliers (Fung Business Intelligence, 2018).

Summary

Pinduoduo raises the traditional e-commerce platform to the next level by incorporating social media. Users may benefit from getting lower prices for products, but in return need to find friends to join them. The platform also encompasses social norms (e.g. public ranking system) for users to expose themselves and improve community building, while simultaneously gamifying the concept and adding a fun aspect. While the ability of its business model is rather successful, there are challenges that it needs to overcome to guarantee the sustainability of its business model. This is however a topic for another discussion.

Sources

Burtch, G., Ghose, A. and Wattal, S. (2013). An empirical examination of the antecedents and consequences of contribution patterns in crowd-funded markets. Information Systems Research, 24(3), pp.499-519.

Financial Times (2018). Ex-Google engineer set for big payday after Pinduoduo IPO. Retrieved from https://www.ft.com/content/05408022-8a2b-11e8-b18d-0181731a0340

Fung Business Intelligence (2018) Group-buying platform – Pinduoduo. Retrieved from https://www.fbicgroup.com/sites/default/files/CNE_Pinduoduo.pdf

Graziani, T. (2018) Pinduoduo: a Close Look at the Fastest Growing E-commerce App in China. Retrieved from https://walkthechat.com/pinduoduo-close-look-fastest-growing-app-china/

Hsuchiachenjenny (2014) Business case Groupon. Retrieved from https://consumervaluecreation.com/2014/05/18/groupon/

Lee, E. (2018) https://techcrunch.com/2018/07/26/the-incredible-rise-of-pinduoduo/

Pandadaily (2018) Alibaba’s Worst Nightmare: Pinduoduo Becoming the No.1 E-commerce App in China. Retrieved from https://pandaily.com/alibabas-worst-nightmare-pinduoduo-becoming-the-no-1-e-commerce-app-in-china/

Virtual reality for elderly


Over the past twenty years or so the media have frequently carried reports about population aging. According to World Health Organization, the number of people age 60-and-over will rise to 2.1. billion in 2030, which translates into one fifth of the global population being in the retirement age. It goes without saying that this trend raises many issues, such as a significant increase of health or public and private pension costs. However, there is a silver lining to this phenomenon: older people are on average healthier than in past generations and especially in the developed countries, economic growth and accumulation of wealth have created a generation of elderly that is wealthier and more willing to spend money than ever before. As a result, the demographical trend has turned out to be a boon for business, creating an attractive, profitable customer segment. Companies who acknowledge that older people have slightly different consumer needs resulting from physiological changes connected to ageing, such as changes in eyesight, hearing, mobility and dexterity, can benefit from an access to a vast customer group. This attention shift is not entirely novel, and has already been recognized by some companies, especially in the financial and healthcare industries. What is new is that firms currently targeting this market have now started to leverage the most innovative technologies that allow them to personalize their offer and encourage their customers to co-create the products. One of the most interesting examples of innovative business ideas targeted at elderly is virtual tourism offered by Rendever.

Business model
Rendever is a company that leverages virtual reality technology to create a virtual journey experience by using algorithms that convert 360 panoramic photos and videos. The firm’s offer is a subscription-based service for individuals and facilities and is designed specifically for elderly. The virtual reality headset allows older adults to overcome mobility difficulties and virtually travel to a myriad of places in the world. The firm’s offer includes various touristic spots destinations, such as Machu Picchu, but also other ways of entertainment such as concerts, historical tours or architectural exhibits. Apart from the company’s existing virtual tourism destinations offer, Rendever also provides a service of a personalized content. This includes recreating spots of sentimental value such as childhood homes or wedding locations and converting photographs of family members, but also capturing a family event on camera that is later converted to a virtual reality experience. Finally, the Rendever wearable devices can be synchronized with other headsets, allowing users to virtually travel together.

Seniors at Maplewood Senior Living travelling virtually with Rendever headsets.

Apart from the entertainment aspect, the company puts an emphasis on health benefits of using virtual reality. As research shows, leveraging this technology can serve as a distraction from pain, which is especially vital for seniors, many of whom have to deal with chronic pain and painkiller medication side-effects. For this reason, VR can be used during exercises or rehabilitation. Moreover, using virtual reality helps delaying the progress of dementia, stimulating the brain and reactivating neuropathways. In such case of cognitive decline or memory losses, as a part of reminiscence therapy, the firm offers individualized packages created from images of family members and meaningful locations from the person’s life.

A senior diagnozed with dementia smiles for the first time in months after being shown a VR video with puppies.

Efficiency criteria
Both customers and the company profit from the product, therefore the joint profitability criterion is met. Elderly people, who due to mobility difficulties cannot commute, can overcome this barrier by travelling virtually – whether to far-off touristic destinations or places of sentimental value. The virtual technology helps them to avoid isolation that tends to increase especially when an older person needs to be transferred to an assisted living community, but also when he still lives at home but due to his age is not as dexterous as before. Customers of Rendever profit from goods and services tailored to their needs: the personalized offer helps them reconnect with family members and virtually attend events they would not be able to travel to. Furthermore, Rendever technology serves not only as an entertainment and an educational mean, but may also facilitate building new relationships through allowing users to virtually travel with others, therefore fulfilling their social needs. The health aspect is also of paramount importance, as using virtual reality may delay the diminishing quality of life due to memory and cognitive losses.
The company, on the other hand, gains access to two market segments. First, it can target a profitable and an increasingly larger group of elderly directly through their individual offer. Second, it can leverage a B2B business model. Marketing to elder care market and health care segment opens up a potentially vast revenue stream. As geriatric population increases, the number of elderly people suffering from chronic diseases such as dementia or Alzheimer rises. As a result, the senior care industry that encompasses elderly care or memory care facilities and assisted living communities has already reached 400 billion dollars of an annual revenue and is expected to grow at a significant pace. The company could also cooperate with the public health sector which struggles with providing care to an increasing number of seniors.
Furthermore, even though the company has to invest into costly advanced technology and production of wearable devices, a subscription-based business model allows it to reduce fixed costs. The manufacturing cost is also expected to decrease as virtual reality gear is becoming more popular and commonly used. Furthermore, the firm’s personalized offer creates an additional revenue stream and increases switching costs that customers may experience, as moving to a competitive product is connected to a loss of the personalized content.

Limitations
There are two significant obstacles that the company may face in the future. Firstly, some of the elderly have an anti-technology views and can oppose using virtual reality technology. As a result, convincing assisted living communities to partner with Rendever may meet with challenges. Secondly, despite the fact that virtual reality technology may help sooth isolation in the short term, there is no guarantee that it would be able to still cheer elderly up as they get used to it. And while seeing family and friends in the virtual reality may ease the loneliness for some time, even an advanced technology cannot replace a real, human contact. In order for the company to overcome these barriers, an awareness about what virtual reality is, what are its benefits for elderly and limitations, needs to be built. Only then will Rendever be able to expand its reach and become profitable in the long term.

Sources:
Bruun-Pedersen J.R., Serafin S., Kofoed L.B. (2015). Simulating Nature for Elderly Users – A Design Approach for Recreational Virtual Environments. 2015 IEEE International Conference on Computer and Information Technology. doi: 10.1109/CIT/IUCC/DASC/PICOM.2015.235.
Irving P. (2018). Aging Populations: A Blessing For Business. Forbes. Retrieved 13th February 2019 from https://www.forbes.com/sites/nextavenue/2018/02/23/aging-populations-a-blessing-for-business/#1b5bb47b7a77.
Laupp J. (2017). 7 Innovative Technologies for Older Adults. Retrieved 13th February 2019 from https://www.allegroliving.com/blog/7-innovative-technologies-for-older-adults/.
Mass Challenge Health Tech. (2018). Reconnecting the Elderly with the Joys of Everyday Life through Virtual Reality. Retrieved 13th February 2019 from https://medium.com/@MassChallengeHT/reconnecting-the-elderly-with-the-joys-of-everyday-life-through-virtual-reality-277bf957483e.
Ward P. (2017). Virtual Reality Is Helping Elderly People Explore the World. Retrieved 13th February 2019 from https://theculturetrip.com/north-america/usa/new-york/articles/virtual-reality-is-helping-elderly-people-explore-the-world//
Wolf Williams R. (2017). How Virtual Reality Helps Older Adults. Forbes. Retrieved 13th February 2019 from https://www.forbes.com/sites/nextavenue/2017/03/14/how-virtual-reality-helps-older-adults/#2e844ed844e2.

Spread Your Wings with Triberr


You have this perfect idea of creating a blog that is going to be fed with eye-catching and breath-taking blog posts. You then decide to sign up on wordpress.com (or any other blogging platform of your choice) and start to upload your first posts. Only to find out that your content is not as spectacular as you thought it will be because nobody is actually reading your posts. So, after a few more trials, you see no progress and decide to abandon the whole blog. Why? Because you assume after a few trials that your posts are useless and boring for the audience? Slow down. Relax. The chances are, your blog posts have not even reached your targeted audience.

In today’s fast-paced world, the internet enables you to connect with almost everyone around the globe. You must already know this when you first considered blogging. But what you might have forgotten is that the internet gives not only gives the reach but also a pool of tools to maximize that reach. One of those tools, given we narrow it to the blogging sphere, is Triberr – a blog post sharing platform that will give life to your blog (posts). Not by using fake humans that will artificially increase your readership figure but by connecting you with real humans who will help you grow your blog organically. We are not talking about social media bots, we are talking about a whole community of like-minded bloggers, who share each other’s contents and this way, support each other. Triberr calls this community a “Tribe”.

So, how does this ‘Triberr’ platform, that I have (hopefully) hyped you on, work?

Triberr is a platform that aims to connect like-minded bloggers to support each other. To understand how the platform works, let’s have a look at its core element: Tribes. Let’s say you are a fashion blogger looking for (more) readers to read your latest blog post that you put so much effort into creating. Triberr does exactly that. It helps you increase the readership rate of your blog posts by connecting you with another fashion blogger, let’s call this person Blogger A. Once you connect with Blogger A, after few procedures, you become a member of a tribe that Blogger A is currently enrolled in. That is, you are now surrounded by people who blog about fashion as you (aspire to) do. After you are officially in, you can start sharing your blog post in the community. What happens next is, once you share a blog post, your team members (called tribemates) will support your blog post by sharing your post on their social media – this way, your post reaches more people but also a more relevant audience. As said before, Triberr is a community of bloggers that support each other. As such, you should reciprocate the received favor you received by doing the same thing – you share your tribemates’ blog posts’ on your social media. Your tribe(s) hence becomes fuel for your blog’s organic growth.

Let’s evaluate Triberr’s business model further via efficiency criteria

Triberr is a platform that aims to increase the same-sided network effect by engaging and connecting bloggers around the world. We can thus define Triberr’s business model as crowd-sourced based. In theory, it means that at Triberr, consumer co-production is high and a network is a unit of co-production (Tsekouras, 2019, p. 28). In lay terms, the previous sentence says that bloggers (i.e. consumers) are willing to actively participate in activities that will create value for Triberr which brings benefits to the platform but also to bloggers themselves. That is, Triberr grows as more bloggers are active on the platform but bloggers also benefit from a higher number of shares and thus, a higher readership of their blog posts. This mechanism thus satisfies the first efficiency criteria, which is [joint profitability] of partners involved (i.e. bloggers and Triberr) who work together to create greater value (Tsekouras, 2019, p. 35). Triberr works as a customer-driven value system and it works because both consumers (i.e., bloggers) and the platform both benefit from each other. To name a number of benefits for bloggers: an increased audience that is relevant, getting to know other like-minded (successful) bloggers from whom they can learn from, and satisfied social needs through the feeling of belonging into a community (aka tribe). To name a number of benefits for Triberr: lower marketing prices because of (electronic) word-of-mouth and increased platform value as the number of bloggers grow. In terms of effort and investment, both participating sides exert minimal efforts: bloggers produce contents they enjoy and outsource sharing efforts, Triberr leverages bloggers and outsources the growth of the platform to them altogether.

In many cases, bloggers can abuse the platform by creating inappropriate tribes as well as tribes could be polluted with inappropriate bloggers. Triberr solves this issue by disabling aspiring members to join the tribe immediately. Aspiring members must first go through an “introduction period” in which they can follow their desired tribe and “join” the tribe as observers (Triberr, 2019). As observers, aspiring members’ posts are not (yet) visible to the members of the tribe. Nevertheless, they are allowed to interact with the members of the tribe and share their posts – this way aspiring members can “earn” the tribe’s trust and thus a place in the tribe. Only after observers become full members, their posts will become visible (and thus shareable) to all members of the tribe. Bloggers are responsible for their own content, which must be original. Contents that are perceived hateful or involving threat and harassment are taken care and act upon Triberr as well as US legal bodies. Moreover, a user’s identification is linked to the user’s social media profile to increase authenticity. In addition, a user’s privacy is protected by Triberr’s compliance with GDPR. As such, the Triberr’s feasibility of required reallocations, the second efficiency criterion, is considered met as (aspiring) members are carefully screened (by the community) and user’s trust is achieved with legal compliances.

Triberr goes beyond tribe community and content sharing.

In addition to the above-mentioned two services, the platform provides three premium services. Users can measure content performance with “triberrAnalytics” in the form of post analytics (e.g., number of clicks or content shares) and growth analytics (e.g., number of new and active members). With “triberrQueue”, users can optimize the posting time of their contents. Lastly, “triberrCurate” helps clients with discovering and choosing the relevant content for their targeted audience.

So, my last question for you is:

“Are you now ready to spread your wings with Triberr?”

Sources:

Triberr man proof [Digital image]. Retrieved from https://help.triberr.com/wp-content/uploads/2015/12/triberr-man-proof-1.jpg.