5 Tech Disruptions That Never Happened
On a regular basis, here in Silicon Valley, I get a sense of déjà vu when I read the tech press or hear pitches from new startups.
The rush to sum up a startup’s elevator pitch to one sentence, inevitably ends up as “{insert name of current big player} of X” (“The Tinder for Jobs”, “Uber for Planes”) or “{insert trendy tech} for X” (“Deep learning for customer service” etc).
Here are five areas that I’ve seen companies tackle, but not seen any huge outbreak success.
1. Personalization
From news stories to bespoke items, the promise of information and services tailored just for you have been pitched as the nirvana of technology. Get it right, means engagement and profits (from commerce to ad targeting). Get it wrong, red face embarrassment.
Things are improving (with cheap processing and AI advances) but it hasn’t taken the quantum leap as expected. Some are tackling this problem with a mixture of manual curation and technology. To me, this is more ‘cohortlization’ (not a word — I just made it up) with an interest based focus (just because I like to run, does not mean I want to read running news or look at running gear).
News feed, online apparel fittings/sizing, 3d printed bespoke items, relevant ads etc are still a long way off. What does great personalization look like? “You’ll know it when you see it”.
2. Craigslist Marketplace
The behemoth and granddaddy of marketplaces (and big data). Founded over 20 years ago, it is a classic lesson in “if it solves a pain, users will put up with crap”. Its lack of any major UI or UX upgrade has not distracted from its core usefulness. In fact, it is this lack of a sexy UI that many early startups incorrectly try to ‘disrupt’ with overblown (heavy) interfaces.
Others have taken a more intelligent approach and focus on a specific vertical that has seen success. For example, taking the ‘Used Goods’ category mobile (Close5, Letgo), or apartment listing for roommates, or the most infamous of all, Airbnb for short term rentals. These new startups are also consuming CL. For many, it has become the de facto marketplace for marketing. (Do a casual search for major names like Uber or Airbnb to see what I mean.)
The latest entry, Facebook Marketplace (its second attempt), have already seen some early stumbles (A baby for sale at $111?).
With the shift to mobile, CL responded with a half-hearted attempt at a responsive design, keeping the legendary UI intact. I don’t see anyone disputing this powerhouse anytime soon.
3. Discovery Commerce and Gifting
This is taking the personalization approach to the commerce vertical. (I am putting gifting in this area, as there is a huge overlap.)
Most of today’s e-commerce transactions are intent driven. “I want X, I search for X and I pay for X”.
Discovery commerce is finding things you were not intending to buy, but stumble upon it and a ‘want or need it’ emotion kicks in. Unlike intent driven commerce, price sensitivity is low, so getting this right is a huge payoff.
The most common way we experience discovery is the ‘You may also like’ or ‘People who bought X also bought Y’ seen on sites like Amazon or Walmart. Suggestions are either obvious (HDMI cable for the new TV or batteries for a toy), price driven or just way off (PS Game for an Xbox owner? Baby items for a bachelor?). The ‘wow — I want that’ is missing.
Visual social networks like Pinterest should be a natural fit, but there are no significant commerce numbers that I am aware of that proves it is working.
Social commerce (suggestions or recommendation based on the social graph) was another area that has not played out as expected. Amazon, Walmart, and even Facebook made attempts to solve this without significant success.
Getting discovery right, also means gifting becomes a lot easier. Gifting is a $multi-billion opportunity, so many new startups tried to tackle this area. Most are focused on making the process of gifting easier (select a price and let the receiver chose the gift). In essence, putting a fancy curated layer over the tradition of gift cards (which still remains the biggest player in the gifting space). To me, this is not tackling the problem head on, hence there have been no major successes in this space.
4. Hyperlocal
I define this as a community (neighborhood) aware and not the narrow geo location aware. For example, for hyperlocal, I may get an offer for a local Starbucks near my office or home, but not a push offer because I walked past a Starbucks.
The term ‘Hyperlocal’ has fallen out of fashion, mostly because we have not seen any successes. But companies are still attempting to use technology to disrupt this area. The belief here is that trust and relevance are much stronger signals at a community level. Trust thy neighbors. Support local businesses.
Nextdoor, Patch are just some companies in this space, attempting to create a go to destination for communities.
[Personally, I am not convinced there is a space to be disrupted here (at least not a unicorn size market). Density and distance of communities mean different online and offline behavior. Maximum local reach is still physical. The whiteboard at the coffee shop. The lost pet posters pinned on trees. The garage sale sign on a lamp post. For online, Facebook pages or Yelp are the de facto destinations (another lost opportunity for Twitter here). ]
These online communities have forums and classifieds. But due to the nature of communities, people tend to split into cohorts (based on interest, life stages etc). The end result is that these online communities inevitably ends up with just a small group of active users that are a small representation of the community.
With pressure on driving revenues, I am seeing a shift to focus on local SMBs and less on creating value for the community members.
5. Air Travel
Commercial air travel remains the one remaining area that has lacked any innovation to make it an enjoyable experience. Lack of transparency and a focus on squeezing profit vs customer experience, on paper, this is ripe for disruption.
Technology startups in this space seem to be more focused on plugging the leak. Find the lowest fare, bots to get a refund, get notified of late flights etc. Tiny increments that are not really moving the needle. (Startups focused on the private jets sector are not serving the masses.)
To disrupt this will take $billions. But it wasn’t that long ago that self-driving cars was a fantasy. Air travel is not a sexy space (going to space is much more fun), I am not seeing the billionaires of the world fixing this. (Richard Branson’s Virgin Atlantic was a start, but we have not seen any major players for over 20 years.)
There are laws on how animals are transported, surely we need the same for humans. A handful of nuts on a 7-hour flight? Is that humane?
That’s my personal fives. There are many others (health, government, email, To do list etc), but the fives are areas I’ve personally explored.
