The Friction(less) Economy
Friction is one of those forces which is hard to see or even understand at times. You generally see two items, the interaction between which affects them both, creates heat and prevents them from moving in the right direction.
1.surface resistance to relative motion, as of a body sliding or rolling.
2.dissension between persons because of differing ideas, wishes, etc.
When you dive into our day to day experiences as consumers, you start paying attention to all of those resistance points that make our lives harder. Just think of the time wasted standing in line in a store. You just found your product, you already know it’s price, and you’re willing to buy it. You’ve even picked it up and are ready to go. So why do you now have to spend 5–20 minutes standing in line to go through a process which, in all likelihood, will end exactly like all parties wanted — you paid for the goods and the store made the sale?
Let’s take another example which may be very familiar to you as well. Remember standing in the rain 10 years ago, trying to hail a taxi? Its seems so obvious: you need a ride and are willing to pay for it, the driver is out there somewhere, but you still have to hail him in the street hoping he pays attention to your hand waving.
Looking at friction points easily explains the success of well known services. Removing it can upgrade an experience and allow tasks, purchases and services to be completed as if they were “magic” instead of a convoluted process.
Amazon is leading the industry when it comes to simplifying our purchasing experience. If “Buy now with 1-click” was the beginning, the Amazon Dash takes it to the next level. When you think about it, it makes a lot of sense. Why do I need to give a vendor my address and payment method if he already knows them from my last purchase? Why spend the time thinking about shipping options if I can just click and buy?
Amazon Go introduces us to a new level of friction-less shopping. Why stand in line and to endure the cumbersome payment process? Just pick out your items and leave. The “magic” machine behind the scenes will do the rest.
But removing pain points takes us a step further than just shopping. Even the simplest things like login and registration might make 20% of the users to never use a service. Registrations forms are a great way to make your users work too hard to utilize your service. Companies had been working on simplifying the process, but it only became really easy with the introduction of the Facebook single sign on option, now followed by other services. It makes so much sense. I’ve already entered my details once — now let’s just save it online and use a single button to access everything.
The problem with operating a business is that friction comes in all shapes and colors. It can come from your supply chain, inventory, shipping, store operation, and marketing. So many things stand in the way of your product getting to a paying customer. Let’s take a look at some less straightforward examples:
- How many times did you go through an online shopping experience only to abandon while entering your details?
- Did you ever purchase a product online just to later discover it’s out of stock and will be delayed?
- Did you ever book a service to come to your home only to discover you have to wait for hours to arrive?
Each one of those examples is a good reason to abandon a service or to be discontent with it to the point of never try it again.
When Itai and I started building CellSavers, removing friction was one of our goals. Can we create a service which removes barriers from both our customers as well as our technicians?
For those of you who have never heard of CellSavers, we are in the business of servicing smart devices at the a customer’s home/office and within 60 minutes.
We operate a skilled mobile force of more than 1000 Savers (Technicians) across the country that will get to a customer location with the right skills and spare parts to repair/install the device on the spot.
Our assumption was that there are so many friction points when your device gets ruined/dropped/inoperable that a new kind of service is needed. Just remember the last time something like that happened to you. You start by panicking, as your most valuable device just stopped working and then you start grasping for a solution. Anything goes, from searching for your old iPhone 4 in the drawer (just to remember they changed the Sim card size) to finding that old mailbox brochure you got a year ago from a local repair shop nearby, hoping they are still in business, trusting them with your secure information, and that the haggling won’t be too bad.
In our case, the focus was dual: Can we reduce friction to our customers while reducing friction to our Savers?
We have created the following goals:
- Our Savers will get to a customer location within 60 minutes. No lengthy time frames and no long waiting time.
- Price is transparent before the service even begins.
- Payment is done only once the service is complete.
- There are no cost negotiations or scrambling for cash, simple cashless transaction.
- The company is the focal point for the service.
- Quality of the spare part is guaranteed.
- Customer will have the best service experience ever.
Technician (Saver) Side:
- Focus on service, not billing.
- Scheduling is done automatically.
- Spare parts are provided without overhead.
- Parts are guaranteed to function every time.
- Predetermined payout for every service.
- Quick payouts directly to account.
Sounds like a challenging Jigsaw Puzzle? It is!
The only way to achieve this complex goal is to remove all barriers from both sides of the marketplace, our customers and Savers:
- We source the replacement parts, along with a strong QA process, and ship them to our Savers based on demand predictions.
- All prices are clear on our website based on the service description the customer provides.
- We have built a state of the art match-making platform that takes approximately 30 different real time parameters each time a service is requested. It match-makes a Saver, his skill set, inventory, location and many other parameters to ensure the right Saver can get to the Customer within 60 minutes.
- The customer pays only after the service is completed, exactly what he saw on the website with no hidden fees or additional costs.
- The Saver is agnostic to the cost of the service and is getting a flat rate instead of a revenue share.
By owning the entire end-to-end Eco-system, our Savers are free from any distractions and resistance involving customer support, billing, parts sourcing and marketing allowing focus on one thing and one thing only: Delivery of an amazing service, which is the reason they love what they do!
Our customers immediately get an excellent service with no haggling and have someone to call if anything goes wrong.
Our last 2 years have taught us a lot. We’ve learned about how even bad reviews are helpful, how to perfectly match a customer with a service person, and how to grow an on-demand company. But we have also learned that the magic of what we do it making things seamless.
Service, installation or even repair should be painless, easy, simple and fun. Gone are the days of 6 hour time windows, waiting hours in line or days until an installer can come to your house. We are here to change that and will not stop until our customer can just click a button and know everything else will be taken care of!