Monthly Archives: November 2013

With mandatory integration of Google’s social media platform Google+ onto Youtube users’ profiles, consumer outcry has been immense. Recent TIME magazine coverage details a couple interesting points. Firstly, the massive response to the implementation comes not only from website viewers, but from content creators as well – including the largest channel on the website, which recently shared its displeasure with the changes. Secondly, there is no sign of relenting and changing policy from Google’s part. As far as I’m concerned, this is a massive detriment to Youtube’s success. Even if the company were to reverse its policies, there’s now a disconnect between the content-creators and commenting users, and the website,which subsequently results in general negative sentiment about Youtube and its services. Google has potentially hurt Youtube’s fundamental user base – Youtube’s lifeblood. The same result happened with the Xbox One’s announced DRM policies, which resulted in potential boycotts in the face of Sony’s PS4 arriving to markets. When big-name online companies play games with privacy and internet policies, they are risking significant backlash from vital customer segments, especially when policies limit consumer options and ultimately fail to reflect their preferences. No extra Google+ or Xbox Live users are worth sacrificing consumer trust, and Google runs a great risk if they fail to reverse or alter their Youtube policies.

As Malcolm Gladwell details in my absolute favourite TED talks presentation, “Choice, Happiness and Spaghetti Sauce”, customer segments in many industries are often too broadly defined in terms of consumer preferences. Through an analysis of the works of Howard Moskowitz , Gladwell details a powerful market segmentation method, known as horizontal segmentation. Effectively, horizontal segmentation is the basic understanding that desirable variety for target consumers has potential to be sufficiently more profitable than a ‘one-size fits all’ type of product. As well, not even the consumer’s themselves has a realistic understanding of their ideal preferences for certain goods. Using the beverage industry for an example, Moskowitz discovered that they key to success for a company like Pepsi is to develop more flavours of Pepsi. And using the Spaghetti Sauce market as an example, it’s detailed that extra-chunky tomato sauce is preferred by 1/3 of U.S consumers, and, at the time of the example (1980s), no such extra-chunky tomato sauce product retailed. Gladwell makes one final statement I hold very highly for both business and social practices: “by embracing the diversity of human beings, you will find a surer way to true happiness”.

Image: Malcolm Gladwell

Recently, Faiyaz Moosa wrote a blog in regards to the  latest downgrading of Twitter after its IPO. Moosa’s predictions about the future of Twitter focus entirely on its unproven results, arguing that Twitter’s long-term prospects are ideal if it can sufficiently monetize its practices. The article he cites, on the other hand, argues that Twitter’s quarterlies and earnings reports will be a burden to its price, as investors will negatively respond. Twitter’s IPO leaves a couple valuable lessons about investing. The first is that sometimes buying into a trend is worth more than the actual investment itself. As Twitter’s securities have shot up to a price of $45, it’s obvious that investors like the speculative nature of tech and social media IPOs, as similar positive results have come from the IPOs of its counterparts. Secondly, financial reports aren’t always an instantaneous reflection of how a share price will respond. As Twitter is a growth stock, there is a naturally speculative nature about its future, so investors will give it time to establish a working business model. After Tesla has released two under-performing financial releases this year, its share price only dropped because a Model S had a battery fire. One thing’s for sure, which is arguably the one thing that matters: Twitter has access to a colossally large number of users on its service, which gives it stunning versatility in how it attempts to monetize.

In reference to Erik Brynjolffson’s TED Talks presentation, where he illustrates productivity revolutions through new arrivals in General Purpose Technology, I’m beginning to wonder if the 3D printer might be that next technological revolution. As a personal, $1,000 retail version of a metal 3D printer is in development, 3D printers are already being identified as an incredibly powerful and worthwhile piece of research and development.  Following the computer that came before it, potential drastic decreases in price, combined with simultaneous exponential advances in speed and power might be the future path for 3D printers – to the point where it potentially becomes a common household item. In a more important sense, however, 3D printing offers a much larger potential disruption to manufacturing processes. Firms are already being pressed by the threat of losing out to lower-cost manufacturing processes from competitors working to utilize 3D printing, similar to Netflix adapting to the online media trend, while Blockbuster suffered an ill-fate. But which industries need to be concerned? Jewellery manufacturers may find a lower-cost production process for their products, for example, and weapon manufacturers could find weapon modelling and prototyping to be a completely different process. If this is, in fact, a technological transition period for manufacturing industries, how, as a potentially affected business, do you assess the need to change, if at all?

Image: The intricate possibilities of 3D printing, shown through a miniature urban diorama

On the topic of entrepreneurship, I urge any and everyone to understand that successful endeavours come in all shapes and sizes. In particular, Gary Dahl, a 1975 entrepreneur, created and sold Pet Rocks as gimmick items. Gary basically put rocks he collected in boxes, and sold them with a pet manual, detailing how  the rocks are “maintenance free”, and “easy to train”. And what do you know? Retailing at 95 cents a rock, Dahl sold 100,000 rocks a week at one point, eventually becoming a self-made millionaire in the 70s, according to this relic of a people magazine article. The lesson? Sometimes even the most absurd and ridiculous ideas become successful in the business world. As well, you don’t have to sell the practicality of a good. In the case of Pet Rocks, Dahl is essentially selling humour. Only 25% of start-ups may end up a successful undertaking, but don’t underestimate the capability of something as odd as Dahl’s rocks when it comes to consumer purchasing trends. Successful marketers and promoters will tell you, ‘how you promote and brand’ may matter significantly more than ‘what it is you’re selling’.

In response to recent classwork, and fellow classmate Sunny Zheng’s discussion of the worth of a degree, I’ve decided to weigh in. I feel Sunny makes a lot of powerful connections in a quantitative sense, linking ideas of job prospects and return on investment. From personal experiences speaking to associates of my father, and contacts from summer work, however, I’ve had the opportunity to gauge what a degree equates to in one’s future. One truth is abundantly clear: a degree is not ensuring an individual success in their future; instead, it merely provides one with a fundamental base for structuring a career. For that reason, I tend not to quantify a degree with statistics. Think about a major investment firm, for example. An individual could be the most successful investment advisor for a company with a sciences degree, for they could be one of a few really powerful biotech securities analysts. But, their degree only acted as a supplement – a base, rather than a means of getting a job. When I go forward in my university education, I won’t look to a BComm as the reason I’m qualified for a job. It’s like what Brian Wong had said during the Sauder panel for incoming first-years (roughly paraphrased), “when I interview potential employees for Kiip, their college degree is simply a checkbox on my notes, nothing more”.

Picture: Brian Wong, Sauder Grad and CEO of Kiip