Monday Nov 10, 2014

Shopping Just Got Easier with Echo

Last Thursday I was in Orlando talking to a group of retailers about the future, and specifically how the internet-of-things might change the way we shop.  I was explaining how companies like Amazon are working on ways to conveniently reorder products, like placing a reorder button in the laundry room so its easy to reorder detergent.  At the same time I was speaking, Amazon was announcing their latest product, Echo, which is even better than I had imagined.

Echo is a device you place in your home that listens for your commands, much like Siri on your iPhone.  It answers your questions and does basic tasks.  What's the weather today?  Set an alarm for 10am tomorrow.  Add paper towels to the shopping list.  When is the next Hokie football game?  Seems like every futuristic TV show or movie has an intelligent voice-response system in the home -- I guess Echo is our first step in that direction.

I'm sure the commands "add to list" and "buy" were the first things Amazon implemented. This product follows the same strategy as the tablet and phone that came before it: make it incredibly easy to buy things from Amazon.  Why bother putting "buy" buttons in strategic places around the house when you can just say what you want out-loud.  Brilliant.

Friday Apr 26, 2013

Oracle Commerce Suite Release

Consumers now have the power to determine how and when they interact with a business, blurring the boundaries of web site, mobile site, service center, or physical stores as separate entities. Consumers want to interact with the business and the brand and have a consistent experience regardless of how and when they choose to interact with it. With a continued focus on enabling a Commerce Anywhere strategy, Oracle's latest release of the commerce suite provides key capabilities to support cross-channel commerce, search, and personalization.

The Oracle ATG Web Commerce 10.2 release includes significant investment across a number of critical investment themes, including Commerce Anywhere capabilities, enhanced business tool experience, mobile capabilities, and multisite enhancements. 

The Oracle Endeca Commerce 3.1.2 release includes a set of usability improvements in Experience Manager, additional features in the Endeca Assembler, continued investment in the MDEX Engine and data integration capabilities, and a number of bug fixes.  Additionally, Endeca Commerce 3.1.2 is coupled with the ATG Commerce 10.2 release to provide native iOS reference applications for iPhone and iPad leveraging the Endeca Assembler.

In the video below, John Andrews explains the five key themes driving Oracle Commerce:

The Oracle Commerce Suite powers Commerce Anywhere.

Wednesday Oct 26, 2011

Amazon Is Doing it Right

Wall Street is broken.  Yesterday Amazon announced it barely missed top line estimates, but fell far below expectations for the bottom line.  Although revenue was up, net income was down 73% from last year.  This caused investors to dump the stock, sending it down from $240 to $200 as of this writing.  But nothing is wrong at Amazon.  They have simply increased their investments in technology and people in order to position the company for the long-term.

As I pointed out in this post back in April, Amazon has consistently made "investment decisions in light of long-term market leadership considerations rather than short-term profitability considerations."  To that end, they have hired 8,100 people this past quarter at a time when many businesses are sitting on large sums of cash riding out the storm.  They will be well positioned for Christmas this year.

Amazon makes "bold rather than timid investment decisions" like challenging Apple in the tablet market.  Their new Kindle Fire sells for $200 but reportedly costs around $205 to produce.  This is the old Gillette trick of giving the razors away to sell the blades.  They will extend their leadership selling e-book but also break into other media as well.  I have already pre-ordered my Kindle Fire, which will get plenty of use in my house along with my iPad2 and regular Kindle.

Amazon continues to "focus on growth with emphasis on long-term profitability" by doing things like securing media content from the likes of CBS, FOX, PBS, NBC Universal, Sony, and Warner Bros for the Amazon streaming service, which is free to Amazon Prime members.  Customers that pay $79 a year get free 2-day shipping plus all-you-can-eat access to its growing media library.  On average, Amazon Prime members spent $400 the previous year before joining, and $900 after.  Pure genius.

I wish more retailers would open their pocketbooks and make more long-term investments in technology.  Yes, there's risk involved, but there's also reward when its done with passion and conviction.  As I pointed out in this post, the big technology companies are changing the retail industry forever, so its time to get on board.  If you don't have a research/innovation team, get one -- this month.

By the way, Jeff Bezos lost about $2.2 billion in stock value this week and he's probably happier than a tick on a fat dog.  (This Texas living is rubbing off on me.)

Thursday Aug 18, 2011

By Your Command

At home we use a Mint robot to clean our floors.  We used to use a Scooba robot but we found the Mint robot was smarter and provided better coverage of the floor.  Its not perfect, but it does 80% of the work and that's a big help.  In the post I did a couple days ago, I noticed that mobile robots were listed on the hype curve and starting thinking about robots for retail.  Could my Mint robot help the retail industry?

By far the best example is picking in the warehouse for e-commerce orders.  Mick Mountz of Kiva Systems used to work for Webvan, the online grocery store.  He tells the story of picking an .$89 can of beans at a cost of $1 -- thus the demise of Webvan.  The typical retail warehouse was designed to deliver items in bulk to stores, not pick single items from here and there to complete an order.

After Webvan went under, Mick thought about the problem and considered the perfect solution would be assigning a no-cost worker to each item.  The picker could then simply yell the name of the product and the worker would run the item over and drop it in the box.  Since workers aren't free, robots seemed like a good alternative.

Kiva Systems has several big retailers such as Gap, ToysRus, and Walgreens running its automated warehouse robots.  These robots intelligently transport the shelves of products to the pickers, thus making the process much more efficient.  Watch this Zappos video to see the robots in action.

The big question is when will people be ready to interact with robots in stores.  Since people are already used to dealing with kiosks, perhaps the next step is making those kiosks mobile.  In much the same way the Kiva robots bring products to pickers in the warehouse, perhaps mobile kiosks can be summoned by customers to provide product information, pricing, offers, etc.

GeckoSystems, a robot designer for the healthcare industry, is considering just such possibilities. They want to provide a mobile kiosk that provides product information and also provides mobile video surveillance.  Starting with touchscreen technology initially, they could eventually use voice recognition to answer questions about products such ratings, alternate color/size, promotions, etc.  While not answering questions, they patrol the aisles where video cameras can't always see, deterring theft (and maybe even cleaning the floors!).

Someday you might just be purchasing that tie from a Cylon.

Monday Jun 13, 2011

Shopper Profiles: Personalization or Manipulation

Zoologists and the like tag animals in order to track them over long periods and better understand their behavior. Marketers would like nothing better than to do the same to you and I, and in many ways it’s already happening. Luckily most companies take privacy very seriously, but the technology exists to build detailed profiles on us not unlike gathering data from Serengeti lions.

Retailers used to rely on focus groups to understand how best to merchandise stores and target their advertising. But as technology has advanced, it’s now possible to collect and analyze terabytes of real consumer-based data. And instead of segmenting customers into similar groups, it’s possible to build individual profiles that are very specific and detailed. All of this is an effort to understand which levers to pull to affect behavior and increase sales.

Websites have been tracking us for years using cookies, which are unique tags that are stored on our computers and mobile phones. While a cookie doesn’t know your name, it represents a list of websites you’ve visited. Between my PC and mobile phone, I am always “on the grid” and easily tracked. These cookies are used to tailor advertising to your implied interests, including “retargeting,” the practice of enticing you back to a website you’ve visited in the past.

There are three main types of data that can be collected about you: your social graph, interest graph, and location graph. Combined, they can help marketers choose the right levers to influence your behavior. Some call it targeting, others call it personalization; it all depends on your perspective.

Social Graph (“Who”)

Your social graph depicts your relationships with friends, co-workers, family, and other acquaintances. Each person is a node, and the lines between the nodes can be of varying thickness to represent the strength of the connection, depending on how often you interact with each person. The easiest way to build a social graph is the get the data from social sites like Facebook and Linkedin, but those sites typically don’t share the data. So marketers have to establish connections by other means such as working at the same company, living in the same neighborhood, attending the same school, or visiting the same websites.

The goal is to determine who wields the influence within a social graph, which is of course contextual to the topic. These influencers derive their power from different angles, but in the end they are able to influence sales. There are experts, like book reviewers and industry analysts, trendsetters, like celebrities and fashion designers, and advocates, like sports fans and zealots.

Interest Graph (“What”)

Built on top of the social graph is the interest graph, which associates interests with people. If the social graph is best represented by Facebook, then the interest graph is represented by Twitter or Quora. Many interests can be inferred from the websites you visit, the ads you click, and the products you purchase. Connected people with shared interest have influence over each other. Every time Bob buys music, three people in his graph buy the same music. They share music as an interest, and Bob is the influencer in the group for that product segment.

Sometimes retailers need only to ask for this information, as many consumers are willing to provide their interest in exchange for more relevant offers. (Remember, younger generations are less concerned about privacy.) Take for example. When you sign-up with the website, you are asked to select your preferred fashion outfits from a series. That information is used to discern the types of fashion that interest you, and personalize the website.

Location Graph (“Where”)

While it’s illegal to track a person’s movement via their mobile phone without proper authority, the data exists. As your phone switches between cell towers or WiFi routers, a pretty accurate picture of your movements can be captured. Mobile phone companies use this data in aggregate to understand where additional towers are needed, but tracking these masses can also help understand migration patterns like where people congregate, the paths they take, and how long they dwell. This information helps locate new stores, advertising billboards, and location-based marketing (like geo-fencing).

Leveraging Your Profile

With the advancements in processing so-called “big data,” it’s possible to analyze terabytes of data to assemble these three graphs a thus create accurate profiles of individuals. Then they can be used to personalize offers and experiences for individuals both online and in stores, which can be a win-win for both retailers and consumers.

I only hope I’m allowed to monitor and correct my own profile, so I’m not stuck constantly receiving offers for perfume and Legos after shopping for my lioness and cubs.

Thursday May 12, 2011

Gamification of E-Commerce?

Zynga makes money hand-over-fist producing simple games that are easy to learn and highly addictive (at least for some).  Other companies, like Foursquare, challenge people to earn badges and status.  Even the Amazon Gold Box appeals to a certain type of user.  Flash Sale sites like Gilt, Hautelook (now owned by Nordstrom), and MyHabit (recently launched by Amazon) attempt to add excitement and fun to shopping in their own ways.  Games, and more specifically friendly competition, can be used to inject fun while influencing behavior.

And what could be more fun than an auction?  There's competition with other bidders, the need for strategy, and a nice payoff if you win the bid at a discount.  An entire industry has grown up around eBay to support this type of retail business.  In both the eBay and Flash Sale models, the retailer brings buyers and sellers together for a transaction that benefits all three parties.

But there's a new group of retailers that have combined auctions and gaming (some might even say gambling) into a fun way to shop and possibly go broke.  I recently saw a TV commercial for Quibids where they claimed someone got an iPad for $24.74.  Yeah, right.  But after investigating, I believe it could have happened.  And while one lucky person got a great deal, many others wasted a lot of money.

The way these penny auction sites work is that you must pay for each bid you make, typically 60 cents.  Items start at one cent and each bid increments by a penny within a preset time limit. Each bid can potentially extend the time limit as well. So using the iPad example, 2474 people submitted bids netting Quibids $1484.60, which is well over 100% markup.  The last guy got an iPad for $24.74 and everyone else wasted their money.

To their credit Quibids now offers "Buy It Now" so that the money you spend on bids can be put toward the same item at list price.  So if you made 25 bids on the iPad, they credit your account $15 toward the purchase of an iPad at the list price.  Its that very feature that makes Quibids look like an e-commerce site with a gaming front end.

Their homepage reminds me of all the slot machines in casino.  Its very enticing...and profitable.


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