Category Archives: gyan

14 Ways to Emotionally Engage users with your Product

Most conversations with entrepreneurs and product managers who want drive engagement and bring viral features to their products are answered as ‘We will gamify our product through features’. This post is about clearing some nuisance around the topic of gamification in products.

Gamification has nothing to do with building features. In fact, even Product Management has nothing to do with building features. It is not a rocket science, product managers usually figure out the ‘building features’ part of it with time and experience.

“People don’t buy products. They buy better versions of Themselves.”

So how do you ‘connect’ users with your product? Not through features, not through gamification, but by triggering certain emotions with your users.

Gamification = Getting People Emotionally Engaged with Product.

Below are some of the most powerful emotions people have along with few examples that will help you figure out how get users to emotionally engaged with your product / startup.
PS: The number of emotions could be more, I have referred to only 14 here.

1. Expression

Expression – People love to express themselves. Enable it.

Products that allow users to express themselves:

  1. Tumblr
  2. Twitter
  3. Facebook
  4. Medium

Products that allow users to express themselves anonymously:

  1. Secret
  2. Whisper
  3. FML

Tip: ‘Expression’ is used as a core use-case in product.

2. Acknowledgment

Acknowledgment: People love getting acknowledged. With interactions & endorsements.

Help people getting acknowledged. They love it!

  1. LinkedIn – Recommendations & Endorsements are social acknowledgments which users love.
  2. Twitter – Retweets and Replies on tweets are great way to be acknowledged.
  3. Facebook – Likes & Comments are acknowledgments to status messages users shares
  4. Quora – Upvotes & Comments is acknowledgment to your answers.
  5. Tumblr – Love & Reposts are acknowledgments to you posts.

Tip: ‘Acknowledgments’ lead to ‘User Notifications’ which further lead to Engagement. Always build features that enable acknowledgments in products that use ‘expression’ as use-case in product.

3. Exclusivity

Exclusivity or Privilege: People love being privileged. Make it exclusive.

Make it exclusive. No one likes the feeling of being left out.

  1. Gmail – Gmail invites were exclusive to few users. People were ready to buy invites off Ebay.
  2. Quora – Only existing users can invite new users.
  3. Pinterest – Users need to apply for access. After few days they were granted it.
  4. Mailbox – Users were in queue to get access to the app.

Tip: ‘Exclusivity’ works best for initial referral program for driving sign-ups.

4. Being Cool

Being Cool: People want to be Cool. People want others to know they are Cool.

Make your users look cool when they share your product.

  1. Frontback – Share a snap along with a selfie. Lets users be cool.
  2. Vine – Short cool creative videos.

Tip: ‘Being Cool’ will help you drive sharing on Social Networks.

5. Nostalgia

Nostalgia: People have memories. Sweet Memories. Remind them about it.

Remind users about some of the best times they have experienced.

  1. Timehop – Complete product is built around Nostalgia. Reminds users of special moments from the past.
  2. Facebook – 2014: Year in Review videos
  3. Twitter – 8th Anniversary: Which was your first tweet.

Tip: ‘Nostalgia’ helps get back old users and revives their interest. Can be only used once in a year on special occasions.

6. Curiosity

Curiosity: People want to know. They fear on losing out. Keep them curious.

Keep users curious. Keep them looking for more.

  1. LinkedIn – The feature ‘who viewed my profile’ tries to keep its users curious, and engaged.
  2. Twitter – Catching up with Timeline, mostly is the fear of losing out.
  3. BuzzFeed / UpWorthy / ViralNova – All try to trigger curiosity of readers through their post titles.

Tip: ‘Curiosity’ in products helps you increase repeat usage.

7. Competitiveness

Competitiveness: People love to compete with others. Creates a sense of achievement. Make it happen.

Drive users to compete with friends / others.

  1. Foursquare – The leaderboards between Friends was a great way 4SQ ensured people kept checking in.
  2. Quora – The feeling of ‘I have a better answer’ or ‘I can answer this question in a better way’ keeps driving engagement.
  3. Fitbit – Leaderboard that tracks your fitness with friends.
  4. Hackrank – Programming challenges.

Tip: ‘Competitiveness’ leads to greater engagement. Though its novelty in private group is lost after some time.

8. Stay Organized

Stay Organized: People love to organize things. Organize everything. Make it happen

Give users stuff that they want to sort / organize. Keep them busy.

  1. Pinterest – Lets you organize pins / interests/ stuff you love.
  2. Evernote – Organize all your notes.
  3. Wanelo – Organize fashion stuff. Ask girls how much they love doing this.
  4. Calendar / Contacts – They are always in a mess. Its a never-ending struggle to organize this. Google Contacts & Google Calendar help you keep them in place.

Tip: ‘Staying Organized’ helps your users spend more time in your product. It soon becomes a habit.

9. Importance

Importance: People love to feel important. Its about them. Their identity. They want to show off.

Make your users feel important about themselves.

  1. LinkedIn – My professional achievements., that is how a user sees it.
  2. Twitter – My views. My opinions., that is how a user tweets.
  3. FourSquare – Checkin is telling the world – I am here.
  4. About.me – This is me. This is my identity.

Tip: ‘Importance’, everyone wants to be important. The product usually ends up being shared, talked about – and results in others wanting to do the same.

10. Authority

Authority: People love to display their authority on a topic. Give them opportunity to do that.

Help create authority for users. Users want to be acknowledged as influencers by others.

  1. Quora – Authority by Topics. Asked to Answer is being authoritative.
  2. StackExchange – For programmers.
  3. HackerOne – For hackers.
  4. Hacker News – For Geeks.

Tip: ‘Authority’ is the importance others in a community or forum assigns to select users. Users want to be acknowledged as being authoritative, it helps increasing engagement and spending time on the product.

11. Visual

Visual: People love stunning visuals. Its a powerful emotion.

Visuals create impact in product. Don’t miss on it.

  1. Instagram – Personal Emotions.
  2. Flickr – Professional Emotions (yes unfortunately for Flickr).
  3. 500px – Photography community.

Tip: ‘Visual’ is a substitute to all unsaid emotions. Use well when your product is build around pictures and photographs.

12. Freebies

Freebies: People love Freebies. Badges. Credits. It all works.

Freebies work. Make use of them correctly.

  1. Quora – Credits users get when other upvote their answers.
  2. FourSquare – Badges for Check-in.
  3. Uber – Credits to Refer Friends.
  4. Facebook / Twitter / Google – Regularly use Advertising Credits to on-board new advertisers.

Tip: ‘Freebies’ – use it only for one purpose. Can be used for activations, sharing or driving engagement. Use it for one use-case that can measured.

13. Money

Money: People want to make Money. People want to receive Money.

Money is one of the strongest emotions. Portray it positively.

  1. Google Adsense – Opportunity for bloggers, individuals, publishers to earn money online.
  2. PayPal – Receive money from anyone.
  3. Elance – Get paid for free-time work.
  4. Kickstarter – Raise money for your projects.
  5. Gumroad – Make money by selling digital goods.

Tip: ‘Money’ – Receiving Money / Making Money is a positive emotion. Giving away is negative.

14. Sex

Sex: People want Companions. People want Dates. People want Sex.

Keep it simple, keep it safe.

  1. Tinder – Helps you find date.
  2. Match.com – Helps you find date.
  3. OkCupid – Helps you find date.

Tip: ‘Sex’ – It is more about selling the Hope. Keep the product simple. Don’t over engineer.

Concluding Notes:

When you build any feature, try to trigger a emotional engagement with user. If you are in early stage of your product development or in process of making your product roadmap, spent some time with this methodology – 15 Steps Towards Building a Great Product.

When it comes to including emotions in your product, ensure the following:

  1. Use max 2-3 emotions per product.
  2. Gamification is not about building features. It is about emotionally engaging a user.
  3. Don’t exploit users. Be subtle. Be good.

Building The Next Disruptive Startup

The most disruptive word in Startup Ecosystem is ‘disruption’. Its used / abused / misused by almost everyone – entrepreneurs, investors, advisors, mentors, press and so on.

Founders love to call their product / startup as disruptive and so do investors who keep saying they are looking for disruptive ideas, both have very limited explanation of what disruptive startup actually means for them or they run out of examples or ideas when you ask them what exactly is disruptive about it. Most of the answers are – ‘If this becomes big, it could disrupt the market’.

Disruption

This is a random post, not intended to draw any conclusion or summary but sharing few things I have learned about disruptive startups and ideas. Probably also on how to get ideas to build your next big ‘disruptive’ start-up.

Circa 2008

Early 2008, I moved in my new role at Rediff as Product Head for Ecommerce. This was still the time when Ecommerce was extremely small in India, concentrated with some players – Rediff, Indiatimes, Ebay and couple of others; and the other side of Ecommerce was Travel which was growing steadily. At Rediff, we had 3 ecommerce products – Rediff Shopping, Rediff Books and Rediff Auctions (We shut down auctions soon after).

These were the early days of Ecommerce and to say we were not innovating then would be wrong. To bring up more users to Ecommerce, COD (Cash On Delivery) was introduced. To expand reach beyond (limited) online audience, experiments like Reader’s Offers (in Newspapers) were attempted by many. We introduced real-time customer support calls to users who dropped out during checkouts and assisted conversions via IVRs. Debit Cards were integrated. Top 20% products in top 20 cities were delivered in less than 3 days. Back then, all major players were marketplaces – that involved a lot of co-ordination with vendors / sellers for inventory, logistics, deals, order status and operations.

Few days into my new role a colleague mentioned to me about a new service – Flipkart. It was selling books. I loved what I had seen on Flipkart. The product was good if not best, but for a site that was launched just few months back – it did all that it was supposed to do perfectly with attention to detail. Prices were comparable if not the best; what blew my mind was the shipping times – awesome 4-6 days of delivery time.

In 2008, books sold on any ecommerce service took 6-10 days to dispatch (most of them had common vendors) and books that required procurement from US took 25 days on a minimum side (and customers used to wait!). Flipkart was quickly dismissed as a niche website, and books contributed to a smaller percentage of overall business. In fact there was a time that competition was more worried about Futurebazaar for its blistering marketing budget (oh, btw its in dead-pool now).

By end of 2009 I moved out of Rediff. And over time I started ordering books (and then other products) much frequently on Flipkart and was never disappointed by its service. I knew friends and colleagues were admiring loving it too. Flipkart kept growing and so did the word of mouth for them. Flipkart was rejected not just by many Investors, but also by its competitors. Over a period of time, all its competitors lost out on Flipkart as it emerged to be the face of Ecommerce in India.

So what did Flipkart do differently to disrupt Ecommerce? Instead of marketplace approach, it started off as a self-managed service. It picked up Books – the most under-served category then (under-served, but large – in 2008 Rediff Books had 1.2 Million Titles listed). It used most simplest channel for $0 marketing – Search Engine Optimization. Adding a million books to Google Index (this is in 2008) in a category that had less than 10 players helped them rank up well. And they rarely did goof up on delivery, dispatch or customer experience.

That was Flipkart. And the story about ‘disrupting a industry’ by a startup or underdog remains similar across the world. Startups / Entrepreneurs don’t disrupt a industry or vertical by ‘launching just another product’ in existing market. There needs to be a remarkably different approach, addressing a large market which is loved (or appreciated) by its initial users / customers.

So how do you get ideas for a disruptive startup?

Another example in Indian context is Housing.com – picked up real estate as a vertical that had more or less no differentiation and existing players were hardly innovating on product and consumer experience over years. Everyone was a copy-paste product of everyone else. Housing launched with a better product from day one for discovering real estate properties, focused on verified data, authentic photos and awesome user experience. While its competitors were serving advertisers, Housing started serving users. It is still in its initial days, but I am hoping Housing.com will become big someday (PS: its product is now bit more complex that it was in the initial days).

Coming back, a existing market / vertical, a large category, that has not changed for a long time are prefect for disrupting with a product that brings a fresh approach to it. While existing players keep thinking that their ‘yet another feature’ will kill this new startup that is making a dent, unfortunately this never happens. ‘Yet another product’ in a large market does not really disrupt a industry.

This probably is true for almost every big startup or product that is out there today.

  • AWS for Hosting:
    Huge market, frustrating times to set up & costly infrastructure, disrupted by on-demand computing and pay-as-you go.
  • Gmail for Email:
    Huge market, competition offering 4-10 MB inboxes, disrupted by 1 GB mailbox and of-course better product.
  • Square for Offline Payments:
    Huge offline payments market, under-served, simple product to accept payments with a phone.
  • Dropbox for Syncing Files:
    Huge need; users mailed files to save on multiple PCs or used USB drives. Simple & fast web storage.
  • Stripe for Online Payments:
    Huge need; developers where busy doing complex PG integrations. Simple to use payment APIs.
  • Uber for Transport:
    Huge market, demand > supply; Under-served market. Cool product that made the customer look smart.
  • … and so many more I can think of…

So where do you go looking for big markets to disrupt and build large businesses?

 

1. Look for market segments that have not changed for years.

In India context, Flipkart and Housing mentioned above fit in this example. We are (probably) done with phase of getting most of the products / services from offline world to online. Some of the verticals are still broken despite being online for so many years.

Examples that come to my mind are – Travel (Vacations – it is still an broken and under-served market), Matrimony (Nothing has changed in this vertical for more than 10 yrs, however people and culture has changed a lot), Classifieds (Largely served by few players and the model hasn’t evolved much) and so on.

Some markets are so big that there is room for multiple big players – Fashion being one of them. Some of the verticals just came online (Online Grocery & Vegetables) but are struggling to grow, maybe they need to approach differently.

One of my favorite examples here is Stripe and how it differentiated itself from others in Payment Gateway vertical. Or even Quora that came up in QnA space that had sleeping products like Yahoo! Answers or Answers.com

 

2. Look for large products that are ageing fast.

Look for large products that are ageing fast and its early users are complaining or it fails to provide value to them.

Some of the examples, LinkedIn (The product has not changed much over years, its early adopters are not using it as they did earlier or now they have other ways to connect with them) or Facebook (Its evident that the engagement levels are dropping and instant messaging has taken over Social Networking). Twitter (Yes, Twitter is ageing. For new users its complex to use, to understand).

More directions – Facebook was default private product; then came Twitter that was default public product. There is lot of opportunity for both products to reverse privacy. For example, Twitter is a public identity to many people, its private aspect ie. direct messaging is massively broken. Forget private product, even Twitter as a public conversation platform is also broken or difficult to explain to new users. Twitter itself is experimenting with removing @ replies to appeal to new users (while existing users will miss the feature most).

 

3. Look for large products that serve multiple purposes.

Look for large products that serve multiple purposes. Perfect one of their use-cases.

Best example here is Facebook. Large products like Facebook serve(d) multiple purpose – Status Updates, Messaging, Photos, Staying in touch with friends, etc. WhatsApp took up Instant Messaging, Instagram took up photos, perfected the use case and in turn made a big dent with their products. Since usage on a large product already validates the market need, build something that makes it work for users.

One of my favorite examples here is Vine how it figured out a niche for itself in the online videos vertical owned by YouTube. Though Vine was not the first to start off (there was Viddy and Social Cam who focused too much on spamy growth hacking techniques on Facebook), it was Twitter’s push that built this one up.

Also recently Zuck announced ‘Un-Bundling of Facebook‘ which serves similar use-case.

 

4. Look for missing components in daily used products that are ignored

Look for broken / boring experiences in the products around you that are in daily use. Broken, because you can fix them. Boring, because you can make them cool (or add value).

This probably over laps the above mentioned use-cases. Mobile OS features like Camera got replaced by Instagram, Text Messaging got replaced by WhatsApp, Mobile Phone Book got replaced by Gmail Contacts. There is a big opportunity if you can identify and replace basic utilities around you with products.

PS: The biggest broken experience on phone or devices today is battery / charging. And this is a tough one!

 

5. Look for big news or market changes around you

If you are too much into technology news look for changes around you and a need for product that you could build because of market changes and opportunities that come up.

Skype was acquired by Microsoft in 2011. Ever since (and even before that) there have been tons of connectivity issues with Skype. Its time for a reliable Skype, one that works as it should. Big opportunity! There is Google Hangouts, but it still doesn’t make a cut and unfortunately Google still treats this product as a part of Google+ and/or Google Talk. It requires attention as a independent product like Chrome, YouTube or Android.

Another big blow was when Google decided to make Gmail for Business a paid service for all. There are other paid business service providers, I tried a few myself when I recently was looking out for a free / alternate solution, finally giving up and settled for a paid Gmail account. Its a great opportunity to build a awesome product here.

My favorite example here is AngelList, Naval is an angel investor in 100+ startups – sensed the opportunity of creating a platform that connects startups to angels much before anyone else did. Another one is how Admob discovered mobile advertising when the world started making mobile websites (WAP sites then).

——————

Concluding Notes:

How to find Disruptive Ideas for Startup?

Listing down the 5 methods mentioned above:
1. Look for market segments that have not changed for years.
2. Look for large products that are ageing fast.
3. Look for large products that serve multiple purposes.
4. Look for missing components in daily use that are ignored.
5. Look for big news or market changes around you.

Wait, your existing startup does not fit in the above criteria? Nothing to get disheartened with, this is just a reference point. In fact I also realized that my own startup does not fit in this :)

Some takeaways,

  • The above 5 pointers all lead to a large addressable market. So next time a investor tells you he/she is looking for a large market, you fit in.
  • Just another startup or just another feature in large market does not make a cut. It should be a differentiated solution / product.
  • Disruptive ideas are plenty, it is the execution and team behind that matters most.
  • Most importantly, don’t build a product or startup in a market that is considered hot. Instead build something that you understand (or understand it well before you start).

And Flipkart, you have my respect for life!

PS: All notes referring to Rediff are expressed as my personal opinion. Most details mentioned here are in public domain already.

Ecommerce Product Management – Getting the Product Page Right

Just few days back I exchanged some notes with Founder & CEO of a Ecommerce company on why I never shop online with them. This venture is among the best known Ecommerce brands in India, but its product experience never gave enough confidence to transact with them.This post is result of that interaction. All screenshots included in this post are not meant to single out any particular ecommerce website and this is meant to be a general post on best practices.

This post is also an extension to my previous post on the topic – Product Management and Ecommerce that was written about two years back. While that post was about general product management principles for Ecommerce, this one is a series of posts that are specific towards reducing cart abandonment and improving conversion rates in transaction businesses. Limiting the scope of this post only to Product Page -> Checkout, this post is first in this series and talks about building the right Product Page and best practices to be observed.

Getting the Right Product Page for Ecommerce – Best Practices

When users land up on product pages through some effort (search, discovery, social, email, adwords, etc), the intent of a users here is positively inclined towards ‘knowing more about the product’ or ‘making a transaction’ and not towards abandoning the page.

The positive reinforcements on a product page are –

  • Product (the product itself), Photos, Price
  • Shipping Information (and Payment Details)
  • Additional Information – If the product, photos & price do not help make a purchase decision, then the additional information that can assist in decision making process.
  • Alternatives & Suggestions

Building Product Pages is a science & art put together with lots of common sense. They should be built / designed as decision enablers and not with the focus that allows users to look at other options in an event the user is not interested in these products.

a. Focus on One Action – ‘Add to Cart’

Yes this is the obvious point. Why is it here, everyone knows this right?

It is here because everyone knows this and because they also know everything else other than this. Simply look at the product pages of the Ecommerce websites, the number of colors on the design elements of page, multiple call to actions – take away the focus from ‘Add to Cart’ button.

As a standard practice, don’t let more than 3-4 colors creep-in on to the product page. Having a color palette helps here and intelligent use of shades of gray to highlight important information if required. Also most critical aspect is knowing that all information cannot be considered as important.

Showcased below are screenshots from top ecommerce websites in India. Notice the excessive focus on highlighting every piece on information, use of ‘design’ and colors in every product element. Have specifically chosen products that have variables like Size, Color – since those are the most complex ones to get right.

Multiple Components asking for Attention, One of top Ecommerce Sites in India

Multiple Components asking for Attention, One of top Ecommerce Sites in India

Multiple Components asking for Attention, One of top Ecommerce Sites in India

Multiple Components asking for Attention, One of top Ecommerce Sites in India

Know how to make ‘Add to Cart’ stand out – look at a product page from NastyGal.com

NastyGal Product Page - Notice the focus on 'Add to Cart'

NastyGal Product Page – Notice the focus on ‘Add to Cart’

 

b. Getting all Decision Enablers next to ‘Add to Cart’ Button

The most important decision enablers (either features or information) should be as closed to the ‘Add to Cart’ button as possible, not miles away. The information should be presented in a top-down readable format – specially for categories and verticals like Clothes, Shoes and others where to process the order you need Size, Style, Color and other such information.

Factors making up the Purchase Decision

Factors making up the Purchase Decision

It is first essential to figure out what are the most crucial 2-3 factors / information that a user needs to know and also accepting that not all information is must.

Add to Cart on Bonobos

Add to Cart on Bonobos

Add to Cart on Zappos

Add to Cart on Zappos

c. Use Standardized Communication & Symbols

One of the key things to focus on your product page (or anywhere on the product) is user communication. From simple things like should it be ‘Add to Cart’ or ‘Buy Now’ or ‘Add to Bag’ to another simpler things – its a tough job.

Standardization? Its a mess out there.

Standardization? Its a mess out there.

Choose widely used terms for communication. I would always suggest using ‘Add to Cart’ because 90% of other websites use it. Remember user is moving on multiple websites, and he has got familiarized with the term. Do not re-invent things for the user. Even for symbols, Shopping Cart has a universal symbol across millions of website.

Same for terms like Cash on Delivery. Free Shipping.

Another issue with Ecommerce websites is the excessive focus on branding everything. It starts from ABC TrustPay, XYZ Assurance, LMN 100% Purchase Protection or PQRS Guarantee, etc to putting up details for Sellers (Marketplaces) – ratings, stars, % feedback, etc. While all that is great, why does a customer need to know this? If its for assurance – there is no need to copy paste such fancy terms across the website.

Thinking from a consumer point of view, if there is any goof-up on any transaction – user will hold the website liable for its service, whether or not it is a marketplace or a store. A simple message like one from ASOS – “Free Returns. Not quite right? Send it back for Free” or from Jabong – “30 Days Free Return / Exchange” does the trick.

One of the leading ecommerce venture says uses the term ‘Free Home Delivery’ which I relate more with restaurant food deliveries and less with ecommerce.

PS: For some reasons, Indian Ecommerce websites love coming up with their own Glossary of Terms!

d. Handling Exceptions on Product Pages

Some of the best user experience practices are seen on products that handle exceptions really well. Only following a simple principle – “Do not show user information that is not applicable’ goes a long way in removing information overload and simplifying user’s buyer experience.

Here are the few common ones that should be displayed only when applicable –

  1. EMI on Rs. 3000 – shown for all the products even those priced below that limit.
  2. Showing Cash on Delivery for products on which it is not applicable
  3. ‘Free Shipping’ when not applicable or Showing ‘Free Shipping on products above Rs. 500’ when the product is already above that amount.
  4. Ships from Chennai – Shown to user who is from Delhi. (Unnecessary second thoughts for the user – what matters is that product is shipped in time, not from where it is)
  5. In Stock. Of-course, why else would you display ‘Add to Cart’ button.
  6. Offers. Most offers kill Ecommerce profits (and the service too) – but since it is a trend now to show them, display only offers applicable to the product. Avoid blanket offers for a category.
  7. Twin Carts
  8. Asking ‘Are these reviews helpful?’ when there are no reviews.
  9. Private Listing of products shown to all.
  10. Free Returns or Exchange displayed on products that are not applicable like Lingerie, Cosmetics, etc
Showing EMI when not applicable

Showing EMI when not applicable

Dual Carts – Not applicable to > 95% users

Private Listing? Why show it to users then.

Private Listing? Why show it to users then.

Feedback on Reviews not written yet.

Feedback on Reviews not written yet.

Showing Offers when none available

Showing Offers when none available

Product  In Stock. Offer that is super-stretch for the user.

Product In Stock. Offer that is super-stretch for the user.

Ships From? Why a User needs to know as long as it reaches him on time.

Ships From? Why a User needs to know as long as it reaches him on time.

Handling Exceptions are really important for every product that is being sold on a Ecommerce site. Simply because every product is different, so are its attributes and not all of them apply all the time.

 

e. Staying away from Fancy Features

Get rid of fancy features on the product pages, some of them really make no sense.

Some of the top fancy features that are seen frequently on ecommerce websites are listed below. Though its debatable that few of them are required, the point to suggest here is not letting them interfere in the transaction process and keeping them passively available.

  1. Compare products on your site. There are different sites available for comparison and decision making.
  2. Ship to my pincode. While this feature has value, actively showing it to everyone does not. Good execution by Amazon India as a passive feature.
  3. Ask seller a question in Marketplaces. Is it scalable if the response is delayed by hours or days. Even users do not ask questions on top selling products.
  4. Login to Save in Wishlist. Almost everyone has feature – why. How many people come to wishlist on ecommerce sites again.
  5. Add to Favorites. This feature is great for social commerce or 100% design-only focus websites like Fab or Etsy, provided it adds value to user.
  6. SEO Fanciness – Many ecommerce services use without understanding how difficult it is for users to read.
  7. Vendor Information. Yes, we know you are marketplace, but there is a beautiful way to telling who the real seller is. (like Etsy).
  8. The filter for filters. Cool, but over period of time they all die and the data operations kill the user experience then.
  9. Comments on products. Again – engagement v/s commerce. Most services that have comments enabled, see user complaints and customer service related comments that further discourage buyers.
  10. Zillion Reviews that make no sense.
Fits SEO, but how helpful is this for user?

Fits SEO, but how helpful is this Product Descripion for user?

Fancy Filters

Fancy Filters – Helped me discover unknown Brands, Irrelevant Form ~ Touch is Qwerty or no. CDMA. Other OS > All known ones.

Reviews that make little sense

Reviews that make little sense

Facebook Comments - Why?

Facebook Comments – Why?

Favorite & Add to Compare

Favorite & Add to Compare

Definitely users don't want to enter in a relationship with the seller.

Definitely users don’t want to enter in a relationship with the seller.

How does this information matter?

How does this information matter?

Thanks for making this complicated. Users only care for price they will buy it for.

Thanks for making this complicated. Users only care for price they will buy it for.

There is a huge buzz around content + commerce, I believe that both of them should not mix. Content products (like Twitter, Quora, or even Wishberg for example) should focus on engagement and time-sink for its users, while Commerce products (like Amazon, Flipkart and others) should focus on transactions that are completed as quickly as possible.

 

f. Photos: Picture Perfect Product Pages

How important are photos on your product pages. If the answer is yes very important, make it a standard practice for product photos to be over 500 x 350 pixels. Optional images are great, zoom-in to see larger photos absolutely great – but those are optional features, the main product image makes a lot of difference.

Large Product Photos on Etsy. Also look at NastyGal's page shared above.

Large Product Photos on Etsy. Also look at NastyGal’s page shared above.

g. Recommendation that kill the Product Experience

Ecommerce sites should put a limit to the number of recommendations that are shown to the users. One of the best known Ecommerce site displays a stunning 9 set of recommendations on its product pages, that includes 35 products being recommended under pretext of ‘for you’.

Recommendations shown for a Mobile Phone

  1. More Mobile Phones from Samsung.
  2. Feature Phones from Samsung
  3. Recently Sold in Electronics & Gadgets
  4. Products Frequently purchased together
  5. More Android Mobile Phones
  6. People who viewed this item also viewed
  7. Top Selling Mobile Phones
  8. Products You Recently Viewed
  9. Recommendations based on your browsing history

Showing 35 recommendations does probably less for making up a buying decision and more for increasing dropouts or bounce rates of product pages. The ideal number of recommendations to be shown to user are 3-4 sets not more than that.

The ones that are most likely to help in conversion are:

  • Products Frequently Brought Together (provided the combined price is not greater than 3X of product price). This recommendation can be also displayed at Cart Level.
  • Customers who viewed this Product also Viewed. (Actual Recommendations)
  • Recently Viewed Products
  • Recommendations Based on Browsing History.

Flipkart & Amazon India does a great job with product recommendations.

—————————————————————————————————————–
Since I do not want this post to sound like a rant, I have attempted to re-create the first scroll product page (of the one mentioned in the first point here) by applying these best practices that I have mentioned here. This is how it looks. (Note: I am not a designer, this is recreated out of plain copy-paste tools.)

Product Page based on the best practices mentioned here.

Product Page created by me based on the best practices mentioned here. Redesigned the first image.

Concluding Notes:

Indian Ecommerce is coming out of age now, its off to a great start. While challenges like operations, logistics and customer experience are being tackled with great enthusiasm to delight users, it is time to also look at getting product management principles right and ensure users have a right user-experience.

Something I missed completely is that not a single ecommerce site reminded me of their mobile apps, isn’t mobile supposed to be the next big thing? A simple feature like ‘Send this to Mobile’ will do wonders – there is a chance that I will further share the product on WhatsApp and ask friends & family.

Remember, users that come to ecommerce websites are not here to build relationship, they are merely here to transact. Some features like Add to Wishlist, Write a Review, Rate this Product, Comment on this Product, Showing Auto-Pop to ask Email (and later spamming with newsletter), etc are not the ones really care about when they are here to transact. They are passive features, completely optional. Don’t irritate your users!

“I’m not here to enter into a relationship. I just want to buy something.” from the famous post – The $300 Million Button by Usability Expert Jared Spoon.

Ending this post with one of my favorite quotes on this topic – “Every feature has some maintenance cost, and having fewer features lets us focus on the ones we care about and make sure they work very well.” – David Karp, Tumblr.

—–

The next post in this series will be Best Practices for Shopping Cart & Checkout Process.

Few Things I Learned As A Entrepreneur in Last One Year

About this time last year, I wrote about my experiences as an entrepreneur. Another year has passed and also that Wishberg completes a year, I am sharing some notes I scribbled thinking about the time that has passed.

  1. Having your own product roadmap is one thing. Building what users ask is another. Choose what the user wants.
  2. Most successful products have very similar characteristics. Here are 15 Steps towards building a Great Product.
  3. Scaling up is much simpler problem to solve. Concentrate on initial growth and traction. When you come to a stage where you want to scale, there will be enough money in the bank.
  4. Ship Fast. Let things break. Often.
  5. A bug is bug only when its noticed.
  6. Focus on doing one thing right. That is enough. We decided to drop everything we did and focus on ‘wish’ for Wishberg.
  7. Chase a vision, not an idea. When you have a vision, you will get 100 ideas to achieve that.
  8. For success you need to try 100 things, one at a time. Make sure you have enough runway to try those. One of that will work. If you are lucky, that would be your first; if not then start-up life will test your perseverance.
  9. Break your long term strategy in to multiple short term targets.
  10. Spend over 30 minutes in shower everyday. You will never run out of ideas.
  11. Concentrate on doing one thing right. You may still fail, but its far more better than getting distracted by trying 10 different things.
  12. Growth hacks that have worked for other startups will not work for yours. Startups can’t be so easy. Find your own hacks.
  13. Success is not easy. Don’t expect it to be.
  14. Every week try to use your product as a new user who has not used it earlier and knows nothing about it.
  15. Doing a startup has a huge personal opportunity cost, no one talks about. This too shall pass, I tell that to myself. Everyday.
  16. Entrepreneurship is not sexy. I personally discourage people from taking it up. Specially the ones with a family to support.
  17. Anyone can take decisions with data. And data may not be available always. Nothing new or ground breaking was ever built based only on data available. Trust your instincts / guts to do build something new. 
  18. Try and fail, don’t fail to try.
  19. Luck is important factor. Wishberg got funded the same month I was about to run out of money. I already ran out of my funds and savings long time back, I refer to the personal loans I took up to keep it going.
  20. Startup as early as possible in your life. Debts, Loans kill your ambitions. Everyday.
  21. Everyday will give you 100 reasons to close down. You need to have that one strong reason to keep it going.
  22. Delegate. But be hands-on. You should know more about your business than anyone else.
  23. Team is your family. Choose wisely whom you want to add. Genuinely love your team and be concerned about them and their well being.
  24. Fight. Argue. Debate. Discuss. Don’t carry things outside office. It all should get over by the day.
  25. Ignore 99% advice you get. The 1% that comes up again and again – think about it.
  26. Funding does not make you rich. No matter how much you make others understand it, they will not. Stop wasting your time.
  27. Everyone struggles. Even a start up without funding. Even a start up with millions of dollars of funding.
  28. Funding just gives you a little more runway. To try out multiple things. Its just a little more runway.
  29. Unfortunately funding is perceived as success. I received invitations to speak at conferences just cause we got funded. Damn! And no one ever called me for any discussion or debate while I predicted Indian startup scene so accurately. tl;dr – I’m not going.
  30. Investors who take over a week to come back to you; who say keep us posted; who say lets keep in touch and so on – will never invest in you. Don’t waste time on it.
  31. Investors who really want to invest in your startup will not take much time to do it. One of our investors committed to us over a Twitter DM in less than a minute. Another one on WhatsApp again in about 1 minute.
  32. Investors fund / invest in you. You. And your ability to grow the product / company.
  33. Don’t say no to money when it comes knocking your door. I said no to it twice (rather my ego said no it). Cash in hand is much better than perceived valuations.
  34. Don’t choose investors based on the valuations. The best investors bring in value. The worst investors bring in just cash.
  35. Build feature products (unlike what investors / advisors say). But build that simple feature as a freaking awesome product that everyone wants to use.
  36. Check the history of acquisitions by Facebook or Google. Your feature product is more likely to be acquired if you build it right.
  37. Choose team, advisors & investors with whom you can talk about life over couple of drinks.
  38. Build something that you understand and believe in. Don’t build what will get funded or is generally considered hot.
  39. Never understood why using foul words in startup ecosystem is considered cool. I don’t think its cool.
  40. Let go of ego.
  41. Anyone who says they will disrupt are just talkers. Just be willing to change and adapt.
  42. Disrupt slowly. Unannounced. Feature by Feature. Before anyone realizes what happened.
  43. Competition will exists, don’t be afraid of that.
  44. One fine day Facebook, Amazon or Google will try to build what you are building. Its sounds scary, but its fun. Btw, I almost cried when Facebook launched a ‘Want’ button or Amazon started Collections or Pinterest tried to position itself as wishlist from a online pin board.
  45. Meet lot of users, lots of people. Get their ideas on your business, product. Some simple things will amaze you.
  46. Be Humble. Be Genuine. Its not very difficult.
  47. Smile. Have fun. As many times as you can.
  48. Build relationships. Specially with other startup founders. Some of them might be at the lowest phase in life, be there. At times they just need someone to talk with whom they can relate.
  49. With more power, comes more responsibility. With more responsibility, comes more stress.
  50. Do something to de-stress you. I try blogging, driving, and observing people when I travel by Mumbai Locals.
  51. Spend at least 1 hour reading up everyday.
  52. Spend one day of every month with your family and friends. Try to be away from the Internet on that day.
  53. Every mistake should be made only once. You don’t have time to repeat it.
  54. ‘Fail Fast’ is a buzz word. Failure comes with cost – money, time and spirits. So you can’t really fail fast.
  55. Value money. Think 100 times before you spend even a single dollar. Negotiate hard. Every dollar saved adds up to your runway.
  56. Don’t do anything or spend time behind anything (feature, update, task, product, or anything) that does not personally excites you.
  57. The single most difficult task of a startup founder is setting priorities. If you get it right, your job is done. 9 out of 10 times you will go wrong. Don’t regret, keep moving.
  58. Simple, short and sweet updates to your product bring the best results. Don’t over think or focus on too many big features.
  59. Focus is about saying No. Stop agreeing too everyone and everything.
  60. You learn most not from blogs or advisors or investors. You learn most from other founders. Connect and share your learnings with each other. We organized a #FoundersMeet in Mumbai.
  61. People around you are smarter than you think. Learn from them.
  62. The most important thing in life is not knowing everything, its having the phone number of somebody who does.
  63. Stay away from events, conferences and pitching events. It takes up a lot of time and energy. Both are precious.
  64. Be passionate. Be enthusiastic. About every new day.
  65. Not just your startup, even you as a person should grow yourself every day. Learn at least one new thing everyday.
  66. Have a bucket list for life, here is mine. Check it every morning, if you see things / wishes that are yet to be achieved, get back to work. Wishberg helps you build and manage your bucket list.
  67. Plug-in your startup in every possible way. I just did that in above point. But no kidding, having a bucket list is actually very inspiring, I have one since last 6 years.
  68. Every morning make a list of things / tasks you plan to finish in that day.
  69. If you are out to achieve something, achieve something big. Don’t set mediocre goals.
  70. Content or Commerce doesn’t go hand in hand. Most startups trying to do both get confused on what they really want to achieve. They really do. Focus on one.
  71. MVP is More Valuable Product. Everyone wants a more valuable product, no one wants a minimum viable product.
  72. Build your startup for growth. Not for exit.
  73. Ask questions. Lots of them. No matter how silly they are to you or the person you are asking for.
  74. Execution is everything. All ideas are equally great on paper.
  75. Startups are not easy. Neither is life.
  76. Build something awesome. Something that people will love to use.
  77. Be thankful to everyone you has helped you in this journey. Make sure you help others in their journey so that they can say thank-you to you. It feels great!
Done. Let’s get back to work.

Facebook Pages: No one is talking about you!

About 3 – 4 years back, Facebook Pages was a hot property. Till just some time back, every brand, every advertiser wanted as many “Likes” as possible. At peak of this trend, some brands even did press releases on reaching 1 Million Likes.

Here is some bad news for Social Media Agencies, Consultants and every concerned with Social Media, Facebook Pages as a product has reached end of its life cycle and is no more valuable for brands. Why do I say this?

Check the metrics for some of the most popular internet brands in India and also International brands.

As defined by Facebook, the ‘People talking about this’ includes – likes, comments, shares, answering a question, responding to a event and claiming a offer. The average ‘People Talking about This’ is drastically reduced to just about 2%.

Why is this happening –

  • Facebook has two current priorities – Improve (and retain) User Engagement & Grow Revenues.
  • In a attempt to retain user engagement, Facebook wants users to engage with each other (people to people) and not with applications or pages. 
  • To grow revenues, Facebook wants you to pay to reach its audience. If the natural viral factor is high, brands no longer have to pay Facebook.
  • More pointers on this in my earlier post, where I said Facebook is no longer a powerful distribution platform.

What this implies –

  • Most pages listed above are currently (probably) not advertising on FB. It effectively means that the natural engagement of a Facebook page is now at a average of 2%. 
  • If only 2% of your page audience is going to engage, the ‘viral factor’ that introduced new users to your page will be a minuscule number. 
  • If a brand has gathered Facebook Fans / Likes by doing advertisements for its pages, value of the money spent is $0 today.
  • In case you are running any advertisements to get Likes to your page, consider halting it.
  • The only way to reach your own audience (people who have liked you) is using advertising tools like ‘Boost Post’.

So why is it a dead product? If a Facebook page (as a product) that has over a million users connected to it, but generates only 2% engagement and possibly even less viral factor is as good as dead. As a transaction product (like ecommerce) the conversions from Facebook Page will be further down since your posts reach a smaller percentage of ‘your Facebook audience’.

Going forward if the audience that you are building through Facebook Page is never going to engage with your posts, it might be a better option for advertisers to consider simply running CPC advertisements to target the necessary demographic, take users to their website and engage them there (back to pre-social media days of Facebook).

If you are a start-up building products around Facebook Pages or anything that concerns with distribution through Facebook Pages or even through Facebook, take a hard look at the data / funnels.

Some exceptions above are Mashable, BuzzFeed and 9GAG. Why? Because they are in the content business (yes Mashable too, in my opinion its no more a social media site) and for the fact that they have exceptionally high engagement numbers is probably because they are the only ones doing content marketing right on Facebook!

For everyone else, no one really is talking about you on Facebook. Not unless you are paying for it!

15 Steps towards Building a Great Product!

Note: I recently gave a talk at The Startup Leadership Program and shared thoughts on Product Management and how to go about building great technology products. The deck I shared is embedded w/t the post.

This for all founders & product geeks (that includes me too) who want to build the next great product. Sharing all this for #StartupKarma (Heard this from Bowei – ‘Continue to give away and help other entrepreneurs with a hope that it comes back to you someday!’) 

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The Background:
As a startup founder, one gets bombarded with advice on pitching, raising investments, growth hacking, marketing and so on. It comes to us through one-on-one interactions, posts we read or multiple startup events and meetups. Unfortunately there is very little or no advice that actually helps you build your product.

Over months, I have studied product patterns in several successful products (like Facebook, Twitter, Quora and so on). This has made me believe that building great products is not just about picking random ideas and shooting in the dark, its a art and science both put together.

Here is a step by step guide for building a great product. I have taken Twitter in this case to demonstrate the examples, however you will be surprised to see the similarities with other products.

Note: Don’t proceed without understanding #0; and without finishing #1 & #2.


#0 | Think: Product does Marketing
The thumb rule for any great product is that you don’t need to market it; it requires zero marketing spends. Instead, it is the users who spread the word, acquire more users which leads to high growth. High virality and strong engagement are the two striking characteristics of a great product. 

So here is the step by step guide towards building the next great product!

</end 0>

#1 | Think: What product are you building?
Have clarity about the product you are building. Make your product statement!

Here are the rules:

  1. Define your product in < 10 words. This is not your pitch statement, its your “product statement”.
  2. Be grammatically correct, include name of your product in these 10 words.
  3. No references with other startups / products. This cannot be “AirBnB for Cars” or “Facebook for Companies”.

Share this product statement with others. Does it communicate ‘everything’ your startup is going to build? If it does not, work on this again!

</end 1>

#2 | Think: Vision
Most startups have beginnings over a random idea (usually this sounds like a billion dollar idea then). Once those ideas get built in 3-6 months, the founders are lost and clueless on what next!

Have a vision around this product you are building. You can run out of ideas, but you can’t run out of vision. Build a product roadmap around this vision. (I mentioned it last year too – point 5 )

Make a note of the vision for your startup / company. Check if the product statement you wrote in Step 1 is the right to achieve the vision you just stated.

Now lets start with building!

</end 2>

#3 | Think: Atomic Unit of Product
I picked this up from Fred Wilson’s post which got me thinking for days on my our own product and even inspired me to rethink on our product / vision.

What is the atomic unit of your product? Example; Atomic unit of Twitter is a ‘Tweet’. For Facebook it is a status update. For Instagram it is a photo. For Gmail it is a email. For YouTube  it is a video.

Simple rules about Atomic Unit of your product:

  1. It has to be owned by you.
  2. It should be only one. More than one atomic unit? Signs of trouble!
  3. Your product statement and vision should be centered around this atomic unit.

</end 3>

#4 | Think: Features

Were always confused on figuring out which features to build and which to let go? Answer is simple – build features only around the atomic unit of your product.

Example., Twitter’s core features – reply, retweet, favorite & follow (a user who tweets) are build around its core atomic unit – “tweet”.

Rules to remember:

  1.  List down all features you can think / build around the atomic unit of your product!
  2. Strip down all the features you have on your product that are not centered around this atomic unit.
</end 4>


#5 | Think: Engagement
Want your users / customers to engage with your product – ensure that features you have selected to build around the atomic unit lead drive engagement.

Example., In case of Twitter, the engagement is Retweets, Favorites and Conversations that one can have around the atomic unit ‘tweet’. Similarly for Facebook it is – Likes, Comments, Shares and so on.

Don’t getting fascinated by engagement features around popular products and force-fit them on your product. Example., force-fitting the favorites like functionality from Twitter on your product.

Rules to remember:

  1. Drive engagement around the atomic unit of the product.
  2. Be innovate. Try multiple options to figure out the perfect fit around your product.
  3. Engagement should be measurable! (Example., 35 Retweets)
</end 5>

#6 | Think: Flexibility

Most startup founders I meet are not flexible. They don’t want to change their product and want users to follow a certain flow which they believe which is right. When asked why, most of the times the answer is “we don’t want to let user play around the product”.

Think twice. Your product should be flexible and your users ‘must play’ with your product. Your product should be flexible at its core – at its atomic unit! Example., Twitter lets you tweet text, a photo, video, post, location & in multiple languages. Others., Facebook lets your post a status that is a text, photo, video and so on. Same for Quora, Tumblr and the rest.

Rules to Remember:

  1. Give freedom to your user to play with your product.
  2. List down all formats in which a user can express the atomic unit of your product.

</end 6>

#7 | Think: Distribution

Key to success of any platform – distribution. Why does this come so late? – You need to build your product right before you even think distribution.

Most founders think distribution is ‘sharing on other platforms’. It is not! Before you even get to allow users to share & distribute to other platforms like Facebook or Twitter, get users to distribute on your own product.

Example., Retweet on Twitter, Share on Facebook, Upvote on Quora, etc are the best examples of on-site distribution.

Rules to Remember:

  1. Distribution should be centered around the ‘atomic unit’ of your product.
  2. If a user has not distributed anything on your product, very rarely would be distribute something outside of it.
  3. Don’t force-fit social in your product. Users will figure out way to share if they like something!
</end 7>

 

#8 | Think: Endorsements
Don’t we breath and live endorsements in our every day lives? Why do we forget to build that in the products we create. Great products use endorsements in every element – it brings out relevance & context to information.

Example., If you notice every element of Twitter has a endorsement if you are logged in. This includes – Retweeted by, Follow Suggestions, Profile Views and Search Results.

Rules to Remember:

  1. Endorsements work 100% of the time. Build them in your product.
  2. Anything that is not context is spam. (Said this earlier)
</end 8>
 

#9 | Think: User Psychology
Most entrepreneurs want users to love their product. Truth is, users don’t love your product. They love the content (or data) on it!

Example., We love to express ourselves on Twitter. Discover best answers on Quora. See moments shared by friends on Facebook.

So if you are building a product, remember to allow users to create their own content and discover relevant content. Don’t try to get users forcefully share something to Facebook or Twitter, it will not work.

Rules to Remember:

  1. Content should be expressed in the atomic unit of your product. Nothing else.
  2. Creation of content is much more valuable than sharing of content. 
  3. If a user has created some content on your product, has something he owns – he is engaged.
</end 9>

 

#10 | Think: Content Dynamics
Once you let users create content on your site, ensure you understand the content dynamics – most importantly that user’s need for that content to be seen! This is step 2 of user psychology – he needs activity around it that will keep him engaged through the features you have built around the atomic unit.

Example., If I tweet something on Twitter, who consumes that content? Not all of my 1000+ followers on Twitter, many of them may never notice it. But there are few followers who will retweet that and amplify the tweet.

You need to have features (again around the atomic unit of the product) that amplifies / distributes the content. And users who do these are your content curators! That is all one needs to know about content dynamics! 

Rules to Remember:

  1. Great content is created by just 1% of your users; That is amplified by 10% content curators – their actions make things go viral!
  2. When content from your product goes viral, in in true sense your product goes viral.
</end 10>
.
#11 | Think: One Point of Discovery

Building product with above elements is important, and now crucial is to package that all in to a exemplary product design. The thumb rule here is simple – user should be able to do everything that has been mentioned here (till now) on one screen. 

Example., the logged in interface of Twitter, Facebook or Quora (though imo Quora still needs some improvements).  

Rules to Remember:

  1. Don’t build a product around design. Build design around the product.
  2. Minimize page views, clicks. User should be able to complete 75% tasks / actions of your product from the screen he is displayed where he logs in.
</end 11>

 

#12 | Think: Privacy
This point is intentionally left blank. That is all I have to say about privacy!

</end 12>

#13 | Think: MVP
Stop building minimum viable products, users won’t adopt them. Instead build more valuable products, I wrote a full post on this topic – the minimum viable product trap!

Still not convinced, here are some examples – 

  1. Bing is a good search engine (if you have not tried it lately, you should). Still we continue to user Google regularly and did not shift. Why? Because there is nothing more valuable it has compared to Google.
  2. Outlook, is now probably as fast as Gmail and with most (of the commonly used) features that users would expect. Yet Gmail continues to lead because Outlook provides nothing more valuable than Gmail.
  3. We did not move from Dropbox to Google Drive. Same., not more valuable.
  4. While in case of WhatsApp, we all moved not just from text messaging to WhatsApp, but also dumped Facebook Chat, GTalk and many other products. Why? – because it is more valuable!

Rules to Remember:

  1. Build something of value to users, that will drive adoption of your product.
  2. Build your product for real users, not for early adopters.
</end 13>

 

#14 | Think: Growth
If building the right product is the toughest thing to do for a startup, distributing it right is even more tougher. If your distribution plan includes advertising or spending $$$s – then you need to rethink your strategy. 

As a startup, you need to completely rely on any existing network to bootstrap your initial growth. Even the existing successful products have, some examples –

  1. Twitter: Live tweets at SXSWi conference displayed on large TV screens.
  2. Facebook: Opened initially in Harward, and more schools later.
  3. YouTube: Nike Advt went viral. Plus many users embedded YouTube videos on then popular MySpace.
  4. Gmail: It was a mail service from Google. Invitation Only. Anyone searching for email services on Google.com was shown advts for Gmail.
  5. Quora: Initially opened to Facebook Alumni network
  6. Zynga: Facebook Feeds.
  7. Dropbox: Invites by Email + Connect Facebook & Twitter accounts.

Rules to Remember:

  1. Bootstrap your growth on other existing successful & large networks.
  2. The networks could be online or offline. Focus on only one!
</end 14>

#15 | Think: Shipping Fast
Many entrepreneurs / founders keep delaying their public beta as they wait endlessly to build a perfect product. This can be very frustrating since the perfect product is always 2 or 3 more features away. Some of the common reasons I hear is – “What if early adopters don’t like the current version of product? what if they rant about it on Twitter?” 

Founders should also know that early adopters are very considerate – they know this is the first version of product that is being shipped. In my case, I rarely rant about early stage startups. To communicate something or to share feedback I shoot a email to the founders. In case I really like a product I spread the word for it. Yes, but I do rant if a startup has raised a Series A, in this case I assume you should have a product where silly mistakes are not acceptable 😛

Rules to Remember:

  1. Ship a Imperfect Product. Its OK!
  2. Collect feedback and ship changes fast. Ensure your write to your users and update them when feedback is implemented.
</end 15>

 

Concluding Notes:
Building products is not easy! Most of the time its shooting in the dark with no clear modelling that lets the product manager believe if a feature you are building will work or not. As startups, we are pressed on time and a wrong feature can cost us time & money.

It took me quite some time to study and understand these unique patterns in several successful products which includes Facebook, Twitter, Tumblr, Quora and others; finally had a chance to put that on a deck and now on this post. 

While this product management process has been personally very helpful for us at Wishberg; I plan to update this over time as I learn, understand and implement more. Would also want to hear your thoughts on this, please write to me on pj @ beingpractical.com on your learnings and inputs. 

Thank You!

 

Telcos, please stop paying mobile bills for your employees!

We all have our stories about Telecom Operators or Mobile Service Providers. I prefer to tweet and receive a call than just calling on customer support and waiting on long hold times. There is so much outrage on Twitter / Facebook against Telcos. Love-hate relationship. At times I end up feeling that the job of Social Media teams of telecom operators maybe more difficult than… err.. Alaska Crab Fish Jobs.

Despite the amount of outrage / complains / feedback, we have wondered multiple times – why do they fail to understand their customer’s agony/pain? How can they just goof up at times on plain simple things?

The answer is ridiculously simple. Most decision makers / process managers / folks in management working at Telcos are given mobile connections which are either not-billed or payed by the company itself. So their employees never or very rarely do any interactions with their own customer service staff like their customers do.

Telcos, there is one phrase extremely popular in the tech startup ecosystem – “Eating your own dog food.” It simply means – use own products / services exactly how your customers do.

To cut the story short – “Telcos, please stop paying mobile bills for your employees. Let them do it for themselves. Treat them as your customers and just see how your processes become more efficient and customer satisfaction scores improve. Eat your own dog food. Please!”

Predictions 2012: Technology Trends; Investments & Biggest Exits in Indian Internet / Tech Space

This post is a update to one of my earlier post written about a year ago on similar lines.

Multiple new products, investments and its always a good thing for the ecosystem which matures with time. Indian tech industry is changing at a rapid pace, its only fair to go back and recheck those predictions and ensure to keep it up with the times.

Meanwhile, predictions that came true:

  • Had indicated the possibility of this particular VCs (without naming specifically, though evident who) investing actively in Indian Ecommerce merging its portfolio companies to form an large entity. Just few days over a year after this prediction, Accel and Tiger Global backed Flipkart acquired Letsbuy.
  • Mentioned that a large player will enter Group Buying deal space. The coupon/deal space was too tempting for many to resist at that time and as I expected, Times Group (Indiatimes) entered this space in May 2011.
  •  Specifically mentioned of Pubmatic being acquired; There were rumors about a possible acquisition offer by Amazon for $300 Mn which was declined as the company chose an IPO over acquisition. Meanwhile Google acquired AdMeld for $400 Mn.
  • Hinted towards AdMax Network in South East Asia which leverages local inventory and is a leader in these countries. While I expected something like this to happen in India, interestingly Komli acquired AdMax. (Though I did not predict this to happen).

 

Predictions for 2012 onwards:

Product based Ecommerce companies:

Flipkart, HomeShop18, Infibeam will continue to grow; and (no brainer now) that Flipkart will emerge as the market leader amongst the Indian players. I expect Flipkart and these leaders to attempt the following –

  • To ensure profitability of logistic operations, either introduce upfront minimum charge for Cash on Delivery below a certain price value or markup its prices by a small amount.
  • Introduce a co-branded credit card with rewards. Not as a branding or marketing exercise, but to encourage existing users to move towards pre-paid payment mechanisms.
  • Spin-off its logistics, customer care, operations departments in to a different company to ensure profitability of Flipkart before it hits an IPO.

Though many criticize the Samwer brothers (Rocket Internet) for creating copies of successful business models – I see nothing wrong in that. How different are any of the other ecommerce sites with their Amazon.com ambitions? Rocket Internet fellas are aggressive risk-takers, investors and amongst their bets on Indian market, Jabong.com has potential to enter in the top 3 / top 5 spots. At some point of time – they may consolidate Fabfurnish.com and HeavenandHome.com into Jabong and set a stage for IPO or an exit through acquisition (Amazon.com?). Rocket Internet is as smart as any other investor when it comes to getting acquired. Watch them!

Marketplace models like Ebay, Indiatimes, etc may face tough competition owing to their helplessness to control key factors like logistics, operations and product quality; precisely what funded startups are keen to build on.

There are now niche plays coming up – Ecommerce services for Tier II/III towns. Most likely candidates to struggle, conceptually sounds great – but the on-ground reality is much different. Will they not accept user orders if customer is from Mumbai or Delhi? I know you talk about ambitions of Tier III youth, age bracket 20-35, etc – but do they require iPad? if yes – why will not Flipkart serve it.

About Amazon’s India plans – I mentioned of the same in this post about about Junglee.
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Vertical Ecommerce and More –

Many ventures who have raised between $2Mn to $5Mn – are yet to move beyond the 500 transactions per day mark even after a year. Few yet to cross 200; scalability is must for any Ecommerce venture to succeed. Verticalization of ecommerce has happened before time.

Predict more consolidation in Ecommerce industry in vertical investments. Simply for the following reasons –

  • There will be a Series B crunch. Most investors have already made multiple investments in ecommerce services. Companies will face tough time raising further investments and will require to raise Series B investments from existing investors. Investors hedge risk by investments in multiple ventures, they will require deep pockets to put more money in one venture, diluting founders more and eventually controlling the company. This shall lead to multiple consolidations between portfolio companies (Flipkart + Letsbuy scenarios).
  • There are multiple vertical funded ecommerce companies in market today. This has happened before time, for verticals to succeed, the horizontal ecommerce play itself should be very large. This is exactly why ventures like Flipkart (books), Letsbuy (gadgets), Snapdeal (coupons) who started as niche expanded into horizontal play.

Few players who have launched multiple sites for focused ecommerce approach, other than doubling costs of user acquisition, the only notional benefit it brings to table is SEO. This might not be even proved in Indian context – though a different vertical, we see that Shaadi.com with single brand focus is as popular as Bharat Matrimony with its multiple brands.

Another trend in Ecommerce is online grocery shops – at this stage most of the ventures are focused in single cities, the challenge for every startup in this domain is to replicate this operations in every city, every locality they expand into in a same or much more efficient manner. Unaware of any investments made in this vertical yet; I’m guessing investors are also looking at same – scaling beyond 2 to 3 locations.

Ecommerce for kids – someone shared a joke with me ‘Probably the rate at which online baby stores are coming up is greater than growth rate of India’s population.’ Very little differentiation between existing players, some of them already moving towards a franchise model (which probably beats the economics of online stores).

Amongst vertical investments – many have happened till date in Fashion. This is an interesting space, however already crowded with no differentiation left. Increased cost of user acquisitions, operations and logistics along with Series B or follow-on investment crunch will take a toll on few players. Funded players will try many things – new brands, labels, etc. The question always will be – what differentiation to bring to table? what exit for investor?

There is also a serious talent crunch with many funded ecommerce players, not just at junior but at middle and senior management levels. Another trend that will come up soon is acquihire deals.

Trend you will notice soon – the last slide of pitches will now read acquisition by Flipkart, instead of Amazon. But in an early ecommerce market acquisitions of competition really makes no sense – will write about this some day.

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Group Buying / Daily Deal / Coupon Companies:

Post the Groupon IPO, the obvious was out – this is not a profitable business to be in. Even the leaders moved away from the Group Buying space – tells us the story of Group Buying or Daily Deals. Has suggested last year that funded players will grow, they did but by pivoting to product driven horizontal ecommerce.

The Groupon IPO spoiled the party for many others who were waiting to be acquired by Google Offers or Living Social. Amazon is know to build large profitable businesses, though Living Social has raised a massive $800 Mn+ in investments till date – its fate might be uncertain. Either hit the dead pool or an acquisition by Groupon itself at a very cheap price!

Back to India, there is nothing much left to say now for this vertical, its just a matter of time when large me too companies who joined the party will start calling it quits. Ebay who experimented with it silently abandoned its play, others like Times, Rediff, Mouthshut will too have to review their presence in this vertical in some time.

Some significant players who made presence felt in the couponing space are – online recharge players like FreeCharge & PayTM. It is too early to comment on their exit, however its a interesting vertical (specific only to India) to watch for following reasons – operators doing something fundamentally wrong as own customers pay bills outside, multiple players have entered the segment, players need to retain consumer interest without causing deal fatigue.

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Online Travel Companies:

Not much changing in travel landscape. As mentioned last year – Yatra & Cleartrip are clear IPO exits. Last year MakeMyTrip and SAIF acquired Ixigo, Yatra & Cleartrip might as well look at smaller acquisitions in this space, particularly players in holidays/vacations – the likes of mygola.

It has been a while that Naspers/MIH has invested in ibibo; with ibibo.com focusing only on games from now, it might look at some kind of exit with Goibibo.com. Meanwhile, Naspers / MIH / Ibibo might look at acquiring one or two startups either in gaming/travel domain to solidify these two verticals, or to expand in to new verticals since they clearly indicate focused growth now with Gaming (Ibibo), Travel (GoIbibo), Ecommerce (Tradus) & Automobiles (Gaadi).

RedBus.in is the clear leader in online bus ticketing space, it will continue to be IPO candidate or hot acquisition target. Owing to high valuation of RedBus, its now noteworthy competitor TravelYaari will be in better position to be acquired – in all probability by Yatra / Cleartrip or GoIbibo.

Repeat – Dear Railway Ministry, please list IRCTC on stock markets. Massive opportunity.
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Online Car Rentals:

Just two years back we saw host of daily deal sites, in last month we have seen about 4 investments made in Online Car Rentals space – Ola Cabs, Savaari, YourCabs and TaxiGuide. Predict Ola Cabs to take a lead in this space – and be a possible acquisition candidate for Uber.

This prediction is not based on the fact that they have raised highest of the lot – because its strategy is right. To be successful in this space, they need to concentrate only on the top 8-12 metros, 90% of their target customer base is in these cities. A smart online car rental service will start only in cities where fleet cabs like – Meru Cabs, Easy Cabs or others have significant presence and created the market. For now, more cities just looks good on paper.

Time will prove this right or wrong – as for now, this vertical has just started showing signs of growth (and already getting crowded). It kind of makes sense for Ola Cabs to make a small acquisition in this space and expand quickly.

Advertising Networks – Web / Mobile:

Last year I suggested that this particular vertical is hinting saturation of market. Out of the existing lot (Tyroo, Komli, Ozone Media, AdMagnet, and other players) – clearly Komli has grown out of India and with its series of acquisitions (Aktiv, ZestAds, AdMax) is trying to position itself as large digital advertising company in Asia, indicating its preparation for an IPO or could be acquired by large agencies like WPP, Dentsu, Publicis or similar.

Unfortunately for India, there is not much technology play in advertising networks, most end up working in model similar to agencies (except the creative part). But few niche technology players in this domain are Sokrati (Paid Search) and Vizury (Display Re-targeting). Both have raised smaller investment rounds earlier and could be good acquisition targets; unlikely for Komli for its partnership with Efficient Frontiers (for search) and display re-targeting has been mastered by many now. Of all players, Ohana Media* could be a acquisition target – its behavioral marketing techniques that combine audience data across channels is amongst the best differential technology available in India today.

Tyroo recently acquired DGM India for $0.6 Mn. DGM was India’s largest affiliate marketing company – a small acquisition size may play spoil sport for couple of startups wanting to monetize through shopping / affiliate related models and currently looking to raise funds.

InMobi continues to be the hot IPO candidate in this space. Google acquired AdMob when advertising on mobile web was at its peak time; current mobile advertising focus is shifting towards in-app advertising, which might even make it a acquisition target for Google (Android) or Apple (iOS devices). New players like Vserv or others would have to build a product sweet sport – number of publishers, impressions available per day and so on, very early days for them.

Guruji seems to now have completely focused its efforts on AdIquity – its mobile advt yield optimization and mobile RTB platform (similar to Pubmatic, but for mobile). Good strategy, may provide exit for its investors by a quick acquisition by InMobi or even by Pubmatic or other web based RTB players like Rubicon Project). As Google continues to mess up its core product – search, it is high time Guruji re-look its search business, not for India but for the world (like duckduckgo).

Pubmatic – is IPO bound. Last year I mentioned them as a potential acquisition target. Its obvious Google spoke to them before acquiring Admeld, they reportedly reject Amazon’s $300 Mn acquisition offer.

*full disclosure – I was earlier associated with Ohana as head of product & marketing. the name was skipped last year due to my association.

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Education:

Many people in investment circle say repeatedly that Education along with Healthcare are hot segments ripe for disruption. Well it is, and a majority of them don’t have a clue what that disruption will be (this includes me). There are already multiple investments made in this Education domain till date, most of them unfortunately will be write-offs and struggle for their next institutional round.

Startups / Investments in Education sector can be classified following segments –
a. Entrance Tests (Online test preparations services)
b. Online Applications (Choose college, careers for India & Abroad)
c. Virtual Classrooms, Online Tutors (self explanatory)
d. Hardware Plays (Education Devices & Tablets)

Startups in A & B –

  • Over crowded space (many funded players, pivoted players, existing players with deep pockets)
  • Though India has lacs of students every year; the choice of colleges are limited – Top 25 colleges are key in every stream (MBA, Engg, Medical, etc). The long tail of 10,000+ institutes does not matter. For the skewed supply-demand ration, these top 25 colleges will attract students anyway. If startups are paid commissions for referrals from Tier-2/3 institutes – to monetize these startups might be recommending colleges that they should not otherwise.
  • Consumer value does not extend beyond 1-time use of service.
  • Students & Parents rely more on taking (free) advice from their friends and family; or people in social circle who can share recommendations.

Startups in C –

  • Fancy names – cloud campus will not do much for its business. Internet is and always was cloud.
  • The best content driven organization – Khan Academy. Its free.
  • Changing syllabus, all online courses need to be revamped. Content heavy services, high cost of content creation; no control on content piracy.

Startups in D –

  • Foolish attempts. Anyone who thinks they can proliferate new tablets for education only are bad students of internet.
  • Education is a content play; not hardware play. Students today have access to computers, laptops and soon Android tablets (steep decline in prices). Instead of building new devices – try delivering content to devices students already have access to.

Education by nature is largely offline category and service oriented. Most of these startups are attempting to package them as products, but will be largely service driven plays behind curtains. Investors care about multiple returns on their investments – will they get 10X returns, I doubt.
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SaaS Products:

The fascination for SaaS products continues with investors and will go on for some more time. Since these investments are in very early stage, it will not be appropriate talking about exits. No one has tried to classified SaaS products yet (not to my knowledge) – but let me attempt it as following:

There are Consumer SaaS products that follow a freemium model – Dropbox, Evernote, Hootsuite, Skype and so on, and there are Enterprise SaaS products.

  1. Business SaaS products priced by usage – Typically products that cater to large business spends. Example., Clickable (catering to online advertising), Interview Street (Hiring) or Amazon AWS (Hosting & Computing), Box, 37 signals, etc.
    Companies will continue to spend more on advertising, hire more with time – hence more revenue potential for these startups.
  2. Business SaaS products priced by featuresBill.com (Online Billing), RingCentral (Virtual 800 number), Xero (Accounting), etc. Best way to identify them is the pricing, the revenue potential of such products will not grow significantly as its users grow.

Restricting only to Business SaaS products – Type 1 SaaS startup will maximize its revenue per user as its customers continues to grow, spends more on advertising, hire more, use more hosting, etc. Type 2 SaaS startup will require more clients to maximize its revenue.

Amongst Indian SaaS products, currently Interview Street is probably in the best position to be acquired (may be by LinkedIn). Freshdesk is also a great product, that has a long way to go building a differentiated model from its competitors (which are in plenty). Another Indian SaaS startup I am a big fan is Practo, but it might take them a while to be considered for acquisition since technology is yet to transform health industry, most big giants in health-care yet to embrace tech.

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Online Gaming:

We will continue to hear of online gaming for few more years, examples of Zynga or Rivio (Angry Birds) for some more time to come. Will there be a exit for any player – No. Take clues from Zynga’s $200 Mn acquisition of OMGPOP – it takes a hit game like Draw Something (massive traction with over 10Mn installs in first 30 days of launch, and cross 50Mn+ early this month) to be noticed and get acquired.

Same happened with Rivio for Angry Birds. The key is simple – keep building till you get that winning game on hand.

Online Matrimony:

Nothing changes here. Bharat Matrimony is profitable play to my knowledge and is looking for its IPO towards the end of this year or early 2013. With Shaadi.com – unsure of its IPO happening any time soon, just as Ias mentioned last year, very unlikely before Consim Group.
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Online Classifieds:

JustDial as known by everyone is heading for IPO. The online-offline model and discovery through phone & web seems to have really worked for them. Really wanted to write something about other players in this segment, but they seem to be busy monetizing more through Google Adsense – so leaving them to rust in peace.

The whole hype about Craigslist was probably the reason why everyone got on to this play. Having said that, not just in India – but globally the online classified vertical is now open to disruption – there are interesting startups like Taskrabbit, Zaarly and more.
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Applications:

Waiting for an Kodak (Oops, I meant Instagram) moment? You may see it soon with Saavn. Amongst all the apps I have seen till date, Saavn is the hottest in terms of distribution, reach and usage.

Tweeted this once – Flipkart should acquire Saavn. There are multiple synergies – Saavn has a vast catalog (subset of Flipkart’s digital service Flyte) and Flipkart has no mobile presence for its digital service. Rather than building a mobile app, waiting for its distribution, Flipkart can start monetization with Saavn’s near 10 Million users from day 1.

Expect in next year or two, this section will have more (and interesting) names!
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Other Exits related to India –

  • Slideshare – expect it to be a great exit story. LinkedIn should probably evaluate the opportunity, once business contacts are made – its time to prove move ahead on keeping them engaged with business content, Slideshare is an excellent fit for then; the other player is of course Quora as written earlier.
  • BookMyShow is another super product in making. Scalable web business models are all about aggregating demand/supply – BookMyShow is well positioned and has all potential to be the largest entertainment company in India.
  • One97 is also set for IPO.
  • Another company I admire is Zomato – but for whatever reasons the company is focused on content and is not building a great product. There is so much more they can do in this space, not sure why they are happy with old & simple play of content + advts.

 

No Clear Exits:

My list of no clear exits has some new names. Like last year – SMS Gupshup, PayMate, mChek continue (read: what problems are mobile payment services trying to solve); will add SeventyMM, SatNav & MapMyIndia to that list (Google Maps and GPS on smart phones has played flattener for their offerings).  For reasons mentioned earlier – majority of players in Online Classifieds & Education vertical have no clear exit plans. Also Onward Mobility (if continue with offline distribution of their apps) is on the list.

Have taken off Guruji from the list – for reasons explained above. They will exit for AdIquity, not for its search business.

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Concluding Notes:

All views are personal opinions indicative of on-going trends, don’t take them too seriously. I was outright rejected by one VC when applied for role as technology (internet + mobile + new media) investment analyst for lack of relevant experience. A top consultancy firm thought it was in our mutual interest not to join them 😉

The only unfortunate part of this post is taking names of startups/companies, many of them founded / managed / invested in by people I know personally and have great respect for; few as friends, entrepreneurs & acquaintances. Having said that, I analyze trends and will be really happy to be proven wrong by passionate entrepreneurs. When it comes to investors, admire those who have placed their bets on companies or products where exits are/were not obvious. That is what risk-taking is all about!

Cheers till them. Will revisit these predictions next year.

Have a different opinion, would be great to hear. Write to me on pj@beingpractical.com / follow on twitter.com/beingpractical.com

Junglee and how it impacts Indian Ecommerce

Junglee has once again got us to debate on our current favorite topic – Ecommerce. Many of us doubting that if current Ecommerce models did it right because Amazon chose an completely diagonal approach to enter Indian market with Junglee.com.

Facts first – Junglee.com has not invented product discovery and price comparison. Pricegrabber.com is one of the best products in this space for US. Shopping.com is owned by Ebay, and many other players in India as well.

There are already lot of posts talking about how Junglee has got it right and it will be the door or gateway to drive traffic and enable transactions on Indian Ecommerce sites. Well that may be true, but honestly I find this really weird, just because Junglee is backed by Amazon – does not mean it will be success or that it is the correct approach. Herd mentality thinking! I guess it is too early, driven by speculation without valid reasoning.

Google Buzz went wrong; Google+ is a disaster; Google Search plus your world is a messed up product. Facebook withdrew from daily deals, Twitter launched activity tab (silently withdrew that in new roll-out) or Netflix tried Qwikster. Point is – big companies make big mistakes.

On the other hand – Amazon has a thing of entering market at very early stage by introducing new products/verticals like AWS, eBooks, Kindle or making an very thoughtful late entry like Kindle Fire (Tablet) or by acquiring category creator or owners like Audible, Diapers or Zappos.

 

Here are some points I would want to specifically highlight about Junglee –

Competition –

  • Junglee is not competing against Flipkart or Letsbuy or any other Ecommerce player in this market at this stage. Product discovery & product transactions are distinctly different verticals., but what Junglee is attempt affects these players.
  • Junglee is not competing even against Google. With 1.2 crore products, it means Junglee will contribute more pages to Google’s search index than any other Ecommerce site in India. Most consumers will discover Junglee through Google.
  • Amazon.com has unmatched resources/experience in Search Engine (paid & natural) expertise; it clearly highlights it as one of the reasons for partners to list on Junglee. (Read point 3 here: http://services.amazon.in/services/product-ads/how-it-works/#/services/product-ads/faq/)

 

How Junglee might change the rules through discovery –

Ecommerce services have limited options of online marketing – Direct Traffic, SEO, SEM, Display Advts, Affiliate Marketing, Email & Social Media. (The funded ones get to do – TV, Radio & Outdoors). Compared to the cost associated with other formats of marketing – SEO guarantees long term and sustainable traffic acquisition mode. Overall high cost of acquisition in other formats of marketing is leveled down only through Direct traffic or SEO. Yes, Social is free but cost of acquisition is still a big proportion as users are acquired through discounting coupons.

Taking previous point ahead, SEO is pure content play and Amazon is master at that. With 1.2 crore products – Junglee will add approximately 3Mn+ pages to Google index, index size is typically 3X-4X for factors like review pages/ recommendations pages / category pages and so on. Due to this sheer size of index and high quality content placement, Junglee will quickly start rising in its natural search rankings. This will affect both – partners who has listed on Junglee and others like Flipkart who have chosen not to.

Here is why –

All products listed on Junglee (or any Ecommerce site) can be classified as two

  • Standardized catalog products (Books, Digital Cameras, Laptops, DVDs, etc)
  • Non standard products (Jewellery, Toys, Clothing, etc)
  • For standardized product like say this Canon Digital Camera – the content includes product description which is standard on every site; but will be enhanced on Junglee with recommendations, reviews and more.
  • For non-standard products like this Mayur Pendant Sapphire offered by CaratLane, despite content being exactly the same, even without reviews or recommendations – Junglee will quickly be listed above CaratLane for multiple factors, key being vastness of catalog for Pendants & Jewellery.

And this is one of the key reasons why natural search traffic on both websites listed or not listed with Junglee will be affected big time. Over time, a high proportion of natural search traffic will be taken by Junglee and will be distributed by it.

This also provides a very large opportunity for small players (including unfunded) or offline retailers (who are lost at times on online marketing) to acquire qualified users.

For those who have not listed, it makes some perfect sense to get their products listed on Junglee as they will witness a gradual decline in natural search traffic. And to get traffic & acquire those customers from Junglee – they will require to be competitive on pricing.

 

Product listings are Free.

Really? and you believed that.

Amazon is selling Kindle Fire below its cost, because it is confident that it will recover revenues of the device through content consumption. If you are thinking that Amazon will not make anything out of Junglee.com – you are wrong. When it comes to churning out online user behavior data and consumption patterns, no other Ecommerce service can do it better than Amazon.

Junglee has the entire product catalog required for Ecommerce. Soon Amazon will have all the insights it wants to know about Indian consumers – Products consumer are searching for, Product-Price ratios or even Demand / Supply for all products categories.

 

Challenges for Junglee –

A product discovery catalog with 1.2 Crore products is not easy thing and Amazon is doing this more efficiently than anyone else with its own core product – amazon.com. Challenges for updating inventory, prices, reviews or recommendations exist, but are not big for Amazon. Junglee can really force upon real-time price and inventory updates to its partners and get them to standardize it.

What would be more interesting is Amazon could localize the product – showcasing partners who can ship in least amount of time to say – Panaji or Kolhapur; deep integrate with offline retailers and help making purchase decisions – like a Apple iPad 2 is available now in Croma (2 Kms away from your location) at Rs.500 discount than buying at an online store.

From what I know – Croma maintains a list of products available for sale in every store on its central inventory management (I was once asked to visit another Croma store to pick up an mobile phone, the staff kept the last piece off shelf). Currently Junglee.com is a minimum viable product, but can Amazon get to this?

 

Where does this all lead to for Amazon – 

Two options ahead for Amazon –

  • Amazon Market Place
    If Amazon is keen – this can happen tomorrow. Junglee has the product catalog, simply enable an payment gateway and instead of redirecting traffic to partner sites, start sending customer transaction orders which its partners can fulfill.
  • Amazon Store
    Keep it slow, learn more about users / markets. And when the time is right launch a full fledge Ecommerce service.

And its very likely that Amazon will take the route two. Feel like investing in Amazon now? Ouch.

Google in its mid-life crisis!

Few days back, read an article about Larry Page, Founder and now-CEO of Google attempting to pull Google out of its mid-life crisis. The article headline was catchy, but no justification of what exactly is this mid-life crisis about.

Below are my views on what I believe are the 10 biggest challenges Google is facing right now and why it might be a tough-time forward for the Internet giant. Flip through the presentation below or read the long post below.

 

1. Search

Yes – Search. Google’s core product is facing threat from another format of search: Real-Time Search.

Google continues to add more capabilities to index real-time information to its search algorithms; but fails to realize that traditional web-index based search is different from real-time search. Last year (April 2010), in its caffeine update Google claimed to provide 50% more fresher results. Nov 2011 it rolled out another set of changes to its search algorithms that affects 35% of all search queries. Again same month, it was discovered that Google started indexing comments on Facebook.

In real-time search, the context in which the information retrieved is no longer valid after sometime. In case of Twitter it does not last beyond a day. Or a week? Same with Facebook. At this same point while consumer search for this information on Google – it is impossible to figure out the context of that search query – real-time info or traditional.

Example. Apple launches its next smartphone – iPhone 5. Consumers looking for “smartphone” on Google Search are shown iPhone 5 results, even when they are not looking for it.

Methods of information indexing, querying, trending, and even consumer mindset for real-time search are different than traditional search. Google may end up killing product experience of Traditional web search with such attempts.

Content index based web search & real-time information search are different products. If Google intends to capture a mind-share of Real-Time web search; it needs to build a different product.

 

2. The Rise of Discovery Platforms

For years, Search was our only means to discover websites, content, products, services. Google was our gateway to the Internet.

Today, with social networks like Facebook, Twitter, LinkedIn and similar; consumers are discovering more and relevant websites, content, products or services. They come to us with recommendations, shares, comments from our contacts – and are more relevant. Interpret this as – Google is no longer the only discovery mechanism.

User adoption for Social Networks is increasing; they continue to have high mindshare and also consumers are spending more time on social platforms today. In addition to this, a whole new wave of innovative products are launched on top of Social Graphs enabling contextual discovery.

Social discovery methods are threat to Search.

 

3. Social

After 750+ Mn users on Facebook, 380+ Mn on Twitter, 115+ Mn on LinkedIn; Google now does understand the importance of having a Social Product.

Its earlier attempts – Orkut, Buzz, Wave failed. It is making a big push with Google+, trying to create a new Social Graph, without realizing that they are already established.

Social Graphs are reflection of our Social Relationships in real world. And they are:

  • Close Relationships: Facebook
    Family, Friends – People you know personally!
  • Professional Relationships: LinkedIn
    Colleagues, Partners, Business Relationships
  • Loose Relationships – Twitter
    Celebrities, Domain Experts. People you know, but they may not know you.

There is no room for creation of another graph. And for Google+, I strongly believe that it will fail again as it is still miles away from being a great social product.

On other hand – Spotify, Netflix, Hulu and many other products and startups are riding the Facebook Open Graph / Social Graph to increase social engagement and usage. While Google is missing the opportunity by not leveraging Facebook’s reach for its own products like YouTube, Google News and similar.

Social is not in Google’s DNA.

 

4. Continued Fascination with Google+

The rule to build successful products is – “Build quickly, learn, build, deploy. Doesn’t work, discard. Start again.” Google taught us this rule; and is now breaking it again and again.

Google should rather focus on building Google+, showing users the value proposition in this platform. Instead it is doing its biggest mistake – forcefully including Google+ in its other products. And in this process killing the user experience and usability of its successful products.

  • Search:  Introduced Google+ profiles of users who shared respective URL in search results.
  • Adwords:  Introduced the +1 button to Adwords display advts.
  • YouTube: Introduced videos shared by Google+ users on YouTube homepage.
  • Gmail: Introduced notifications on Google+ updates on Gmail header toolbar.
  • Google Reader: Introduced sharing options, adding users to Circles from Google Reader.

In any of the above products, Google+ additions are not enabling any core-feature of the main product. These would have been great things to do if Google+ had proved its own value to users. Google is simply leveraging successful products to promote Google+.

Didn’t Yahoo try his before – everything Yahoo. I didn’t work earlier, it will not work now.

 

5. Fixing whats not broken

Google wants to act fast and speed up its innovation. While doing this, it is actually fixing whats not broken.

Gmail –

  • The new design update Google is planning to push to all its users – is uncalled for. The functional updates are great thing to do, but the changes to its look are at the expense of product usability and could have been avoided.
  • Google announced launch of a very buggy version of its Gmail client for iOS; and recalled the same from app stores within hours.
  • Stops support for native Blackberry App. While Blackberry itself is on a decline, it still has a significant 19.7% share in US smartphone market and continues to grow in countries like India.

Search –

  • Started with its Caffeine roll-out in June 2010 to include fresh content.
  • In Nov 2011 – it pushed another big roll-out that impacts 35% of search queries.
  • Labnol discovered that Google is now indexing Facebook comments.

In search of freshness, Google is playing too much with its core search product. As mentioned earlier in this post, Real-Time search needs to be a different product.

Google Maps –

  • Announced pricing for Maps API High-volume usage.
  • Location is a key to future product innovation on top of Maps. This move is likely to affect a lot of startups innovating on top of Google Maps.

YouTube –

  • Homepage displays videos from People you follow on Google+

Google is also implementing design standardizations across all products – Search, Gmail, Reader, News, Books and more others. Google is killing uniqueness of its products by standardizing its look and feel and continuing with its fascination of Google+.

 

6. Siri

It may not be easy for anyone to dismiss Siri as a feature on iPhone 4S. Siri is not just voice recognition; it is another input methodology. Siri’s natural language interaction is far more superior than the syntax driven VA (Voice Actions for Android). VA is anywhere between 1-2 years behind Siri. That is a (HUGE) advantage Apple holds.

As the technology improves, one can start talking to Siri as –

  • “Siri, search for ‘MP3 Player’, take me to the best result!”
  • “Siri, show me the map of Mumbai.”
  • “Siri, who is offering the lowest flight ticket from Mumbai to London.”

There are infinite possibilities what Siri can develop into quickly. Most importantly – the potential it holds can make many Google products and services around it irrelevant, like –

  • Search – Ability to discover new websites and relevant services without using Google Search.
  • Adwords – Google relies on clicks for monetization. Siri means no clicks, just talking.
  • Maps – No longer view maps while driving, Siri will look up to them and speak out the directions.
  • SEO – What happens to the SEO ecosystem around Search? Will the new optimization be SVO (Siri Voice Optimization)? How will it work?

Google mastered the standard text-input methodology on Internet (Computers + Mobile). But the threat from Siri is Real. Of all challenges Google faces, Siri is the biggest. The last known big transition for input methodology was finger-based touch inputs (introduced with iPhone). In last couple of years, it replaced traditional keypads on all smartphones.

Siri should be a big bouncer to folks at Google; caught them off-guard and completely unprepared.

 

7. Android v/s iOS

Google scores a big thumbs up with Android capturing 43% of US smartphone market. Apple lost opportunity in developing countries due to its high-priced iPhones while Android phones & tablets flooded the markets with price points from $75 to $1000.

In my own view – I find Google strategy to enter smartphone market extremely fascinating. Samsung, Motorola, HTC, LG and many others were excellent hardware manufacturers with poor software / applications / user experience capabilities compared with Apple or even Nokia. Google gave what these partners lacked – an mobile operating system and ecosystem of applications.

Distribution of Android phones provided Google the opportunity to monetize the mobile search queries. Current trends in mobile are slightly more inclined towards building Apps & HTML5 websites, most developers and product companies want to ensure a seamless experience on phone and also presence with a native client. Google also aligning itself by directing mobile publishers to Adsense and enabling AdMob for Mobile applications.

Google acquired Motorola Mobility to debut itself as an Software+Hardware play (like Apple?). But it may have limited or no advantage with its own hardware play (through Motorola) as it will face tough questions from global Android partners like Samsung, HTC, Sony, LG and others who are responsible for large distribution of Android OS and its popularity. For now, the Apple dream may look difficult.

There are also few more challenges facing the Android ecosystem –

  • Apple still largest and extremely focused contender with its one-phone market strategy for iPhone
  • Android being open; Consumers have a huge choice for Android phones from $75 to $750.
  • Only differentiation between Android phones are hardware capabilities; hardware edge is tough to maintain.
  • Brands like Samsung, HTC, others will require to have devices at all price-points to ensure growing market share. Only significantly high volumes will bring profits.
  • Tough competition on price from Chinese and low-cost android phone manufacturers.

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8. Monetization

2004: Google’s largest contributor to its Revenue: Adwords
2011: Google’s largest contributor to its Revenue: Adwords

In 2004, Advertising was only large scalable online monetization model. In the quarter Google debuted on Nasdaq; Amazon reported profit of just $54 Mn.

In 2011, there are various scalable monetization models:

  • Online Advertising / Search & Display (Google)
  • Online Advertising / Social (Facebook, LinkedIn & similar)
  • Mobile Advertising (Google, InMobi & others)
  • Local Advertising (Groupon, Foursquare & similar)
  • eCommerce (Amazon & others)
  • Enterprise, CRM (Salesforce, Box.net & others)
  • App Stores (Apple)
  • SaaS Products (Dropbox, Evernote, others)
  • Payments (PayPal, Square, others)
  • Smart Computing Devices / Tablets, Kindle, Smartphones (Apple, Amazon, others)

Multiple scalable monetization models evolved over last few years. Google unfortunately has not moved beyond Adwords.

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9. Lack of Innovation

Over years, Google is struggling with innovation. Many existing and high potential products are on decline.

  • Blogger: Introduced the world to blogging. Lost battle to WordPress, Tumblr, Posterous.
  • Google Books: eBooks store of the World? eBook for Android phones?
  • Google Docs: Never really went beyond Gmail attachments. Evernote? Box.net?
  • Google News: News recommendation service or aggregation. Pulse?
  • Google Apps: Endless opportunities in Enterprise services.

Google also abandoned or mis-managed on some the big ideas –

  • Chromebook:
    Post launch announcements, not much has been heard about Chromebook project. If Chromebooks were built to optimize over web, why did it not follow the Android platform? Ideally it should have built and optimized version of Android for laptops & tablets (Android 3.1 Honeycomb for tablets came much later).
  • Orkut:
    Google never realized the potential of Social until too late. Orkut which could have been the default Social Networking destination for world, never innovated beyond UI changes and probably never got the resources that it deserved.
  • GDrive:
    Google was to launch an online drive for storage back in 2007; much ahead of Dropbox’s launch. The project was abandoned and Google is reportedly working on its revival once again post Dropbox’s success.

Over years multiple products have evolved that Google has not paid attention to. Some of the hottest startups and businesses today are in product domains like – Multiple SaaS domains, Social Commerce, Social Products, Local Businesses and so on.

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10. Failure to execute Acquisitions

If you can’t build it, acquire it. Google has done some awesome job with many of its acquisitions, but unfortunately not the ones in Social. The big lost opportunities here are Aardvark, Dodgeball and Jaiku.

  • Jaiku:
    An micro-blogging service that launched well before Twitter and acquired by Google in Oct 2007 had the potential to be Twitter or a tough competition. Twitter today has over 380+ Mn users and valued at an estimated $8 Bn.
  • Aardvark:
    An social QnA service created before Quora was acquired by Google for $50Mn in Feb 2010 had enough time to learn and innovate. Google announced its closure in Sept 2011. Lost opportunity – Quora is now valued at over $1 Bn.
  • Dodgeball:
    One of the earliest location based social products for mobile was acquired by Google in 2005 and discontinued in 2009. Dodgeball’s founder Dennis Crowley launched Foursquare which is one of the hottest location based products today with over 10 Million users.

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Ending Notes

Design standardizations that kill identity of products. Inability to build competitive products and match speed of innovation. Failed attempts at Social Networking. Fascination to promote / push Google+ through its successful products. Failed acquisitions.

Google is currently showing all signs of being the next Yahoo. At this pace, engineers will sense more challenges and opportunities to innovate outside of Google. Its not too late, but yes – Google is in its mid-life crisis.

Concluding Notes for myself and other startups – “Don’t try to do something in everything. Rather focus on doing everything in something.”