Observing Americana. And Why Silicon Valley needs to get out more
This past week I was with my family in Orlando, mostly bouncing from Beedo to Hagrid. Universal Studios is an extremely good random sample of mainstream Americana for Silicon Valley tech. Some observations that jumped out at me:
Self-health tech need to er..stretch more: America is overweight and fitness bands haven’t really made a dent in mainstream America. I saw maybe 1:1000 Fitbit-type bands. There is clearly a market for better and more implicit forms of useful data capture and more granular self-health gadgets based on ailment. And an opportunity for alternative dinning options such as Munchery to expand from convenient and flavor to nourishment.
Diabetes risk will only rise and rise: Food options are getting better at theme parks but there’s a line out the door for bucket-sized portions of caramel popcorn and unlimited soda refills. Self-help Apps such as OneDrop have a huge market. But early pioneers must bear the cost of educating at scale unless they can drive network effects for not just usage but distribution.
Developers will keep betting on iOS: Most parents are using iPhone and so are their kids. The transformation from Steve Jobs’ era of perfecting engineered systems to Tim Cooks nurturing of engineered ecosystems is working for Apple, in spades. Of course, engineered Ecosystems go far beyond communication devices (home appliances, car, etc.) and Google et al have tons of opportunity. But Apple is crushing it right now and the watch isn’t even here.
We need to spark more buying cycles in established markets: Under Armor, TruMoo, Monster Energy – a sample of very pervasive newish brands at Universal. Each of these sparked a buying cycle in a crowded market. In tech, we’re very good at creating markets a la Uber and AirbBnB but we often get skittish about sparking a buying cycle in an established market because we can be too sensitive to correctly timing a replacement cycle. The success of these consumer brands shows that with a clear brand raison d’être, a sales-driven culture and a product strategy that is super observant of current usage patterns, you can muscle your way into a crowded market and get in front of the parade. Tech, including Enterprise Software, needs to spark many more buying cycles. It’s cheaper too – the competition has already paid the freight to draw out demand. This one hits close to home for me – it’s the essence of the SAP Jam product strategy that has led to 17M subscribers in 12 quarters for SAP / Successfactors.
Peer to Peer Payments is still pimply-faced: When you see how a) the general choices are very limited and b) a few merchants drive 10s of millions of dollars of commerce because they control the point of sale, it’s clear that peer-to-peer commerce just hasn’t achieved product-market fit, yet. This doesn’t come through in Silicon Valley press, but many commerce categories are ripe for Uber-ization.
Big markets, Narrow bands: I booked late and had limited hotel choices, ending up in a modest but very conveniently located hotel for the kids, which was more important. This hotel was designed for a clear common buyer denominator that prized the combination of a) best location plus b) an adequate experience – adequate room furnishings, burgers clearly bought in bulk, iceberg lettuce, yellow mustard only. You get my drift. “Frictionless Design Choices” resulted in the hotel being oversubscribed every night. The lesson: Scale comes from staying intently focused on a narrow band of buyer types that come in gynormous quantities that’s at least 10x your capacity. Lots of adjacent sales to drive up the bill for sure but always within the band. Spaghetti and Meatballs was as far as they strayed, making sure to never disrupt the supply chain or service level expectations by going up market. Staying true to your segment is important – no one working at this hotel was confused about what the business stood for. And patron expectations we’re also well set.
And finally, America still rules: Real estate prices in pockets are ridiculous but relatively speaking, America remains accessible and approachable to more people on the planet than any other country and its biggest strength is upstream or downstream economic mobility built into the system. It’s far from perfect but for most hard working families, there remains an affordable town from Tiburon to Toledo to Texarkana where families can be genuinely happy and create amazing experiences and memories. America knows how to find an equation that lets it be present in the moment vs. only chasing a destination. Us technorati can get better at this. I know I can.
Silicon Valley needs to get out more.
(cross posted on LinkedIn and Medium)
