Silicon Valley is Eating Your Lunch: 4 Ways to Stop Them
Everyone knows about Amazon recommendations. Depending on what a customer has bought before – car parts, baby products, office supplies – the site will show them related items that they may want to buy today. Adding this feature had a huge impact on sales — introducing recommendations increased Amazon’s sales by as much as 29%.
You may think that there’s no lesson here for your business — you don’t have access to groundbreaking AI, the world’s largest logistics network or a massive marketplace of millions of items. But you’d be wrong. In fact, Amazon and other digital-first Silicon Valley companies succeed with these kinds of initiatives because they know how to create a data-trust exchange.
Amazon has built a trust relationship with their customers, so customers choose to share their data (in this case, a detailed picture of why, where, when and how they make buying decisions) with Amazon in exchange for useful services (convenient recommendations that help them find what they’re looking for, faster). It’s no surprise that 60% of customers say they are comfortable sharing their personal information with a highly trusted brand — and that Amazon and Google were rated the #2 and #3 most trusted brands of 2020.
Any company can begin building a data-trust exchange with its customers and fortifying its defenses against Silicon Valley. Get started with these four tips:
- Present your brand in its best light. Silicon Valley knows that today’s customers have high expectations for apps, and their app experience is just as big of a part of their brand as their TV spot or social media campaign. In fact, consistent brand presentation across all platforms can increase your revenue by up to 23%. Look for a development partner with the design and strategy chops to thoughtfully extend your brand experience through your app.
- Start with research to inspire your next big app idea in order to maximize customer value. 60% of companies think they’re providing a good app experience, but only 22% of customers agree. Customer insights research can help you fact-check your assumptions about what features your customers will find valuable – while keeping an eye towards technical feasibility – in order to make the best bet on your app’s roadmap. Invest in a vendor that has experience exploring and validating technology ideas. If your development partner provides this service, even better — then, the team working on your app can get first-hand inspiration from your customers as they make recommendations.
- Find new opportunities by leveraging internal subject-matter experts. Often we think digital transformation can only happen from the top down — the CEO of a company declaring the Next Big Idea. But Silicon Valley knows better. For example, the Amazon Fire TV was the brainchild of a junior executive — “What if we made a streaming device that you could plug into a television?” — that went straight up to the top. When searching for digital transformation opportunities, think about what segment of your business you may like to target, and go straight to the knowledge-holders there — they know the most about your customers and may surprise you with their ideas.
- Consider a subscription model. For brands they trust, 75% of customers say they will buy that brand’s product, even if it is not the cheapest, above all others. Clearly, your brand still has value to your customer — help tip the scales towards Amazon-like convenience with a subscription model. If you can remove friction for your customer by creating “set it and forget it” convenience, they will reward you with an entirely new stream of predictive data. Capture that data with a well-architected app, and you’re well on your way to a data-driven business model.
At Stable Kernel, we can help you get started with Silicon-Valley-style thinking — whether you’re a 200-year-old legacy brand or a brand-new company. Key services we may suggest are:
- Existing app audit to recommend how to create experience parity
- Research discovery session to identify targeted opportunities for user research
- Customer-obsessed workshop to help anyone in your company uncover opportunities for creating customer value
- Subscription path planning session to understand the steps your company would need to take to enable a subscription model
Contact us today to start your roadmap to a data-trust exchange — and stop Silicon Valley from eating your lunch.