Category: shopping | 購物 | 쇼핑 | 買い物

Hi, welcome to the shopping page. There’s probably not as much here as there could be. But then I try and buy less but better stuff nowadays.

Shopping isn’t only about the transaction, but the experience. That’s what separates Selfridges or Lane Crawford from Amazon. I like the serendipity of a great retail experience.

Whether its rifling through secondhand records and discovering a gem, or trying a sample and buying something new – Amazon’s recommendations can’t give you the same feeling. It’s primal like foraging or hunting.

A retail experience is also a signifier of culture and history.

I remember experiencing a department store experience similar to what my parents would have known in 1960s Ireland. This was the far side of the world at the former Wing On department store in Cityplaza, Taikoo Shing. Hong Kong held norms and traditions that western Europe had moved away from. This was also signified in the focus on more formal business dress, even in the creative industries.

So you might find more about experience here rather than items purchased.

Shop OS versus mobile OS

I decided to write this post to reflect on the very different visions of digital retailing that consumers are currently experiencing. I’ve labelled these two visions mobile OS and Shop OS respectively.

The Mobile OS

I went to Wagamama with some colleagues from Racepoint where we were encouraged to all download Qkr!. Qkr! is an application that was developed by MasterCard rather than the restaurant, it isn’t exclusive to Wagamama either. MasterCard has built the application with a view to building a wide eco-system merchants. It is notable that the application is actually card issuer agnostic, so I was able to set up an account with a Visa card. Wagamama bribed us with free desserts to download the application, so they clearly have some skin in the game. We downloaded it, set up our account with at least one mode of payment, our email address and a password. One of us became the host and gave us all a number which was our common bill. We could order straight from the app and food was supposed to arrive. When we wanted to pay we selected our items and paid our share of the bill. A couple of us only had cash, so they paid a friend and the friend paid on the app. If I am absolutely honest with you, it was a lot of work for casual dining and but for everyone around the table working in technology marketing (and so having a modicum of curiosity about things app-related) – it probably wouldn’t have had us all on board. Now that we have the app on our phone, I could see Qkr! hoping that we use it regularly and likely try and steer us to its merchant network though notifications and special offers. From Wagamama’s point-of-view it saves them from building, testing and maintaining a bespoke application. There are also presumably productivity benefits from reducing the order taking staff required. Qkr! didn’t prevent Wagamama from making mistakes with our order and we ended up one chocolate cake down. Contrast this with the approach that McDonalds have rolled out in their new (to me) Cambridge Circus branch. The area between the counter and the entrance is dominated by a series of vertical kiosks.

These kiosks contain an identical touch screen interface

With a basic card reader on the bottom, there is no Apple Pay or NFC facilities, just a chip and PIN reader. The touch screen menu takes you through a smartphone app like experience, if smartphones came with 27 inch screens. Once payment was successfully received, you then received a deli counter style receipt

And collected from a counter when your number appeared on the screen

This is all designed to reduce consumer interaction and improve efficiency in the restaurant, if there was any way to cheapen the McDonalds’ experience making you queue like an Argos seems like the ideal way to go. The logical progression for this would be to move back to the Automat format (presumably this time using some sort of algorithm to optimise production.

The irony of it all is that the rise of fast food restaurants like McDonalds killed off the Automat as a trend in North America and many Automats were converted into Burger King franchises.

Both Wagamama and McDonalds may have had some efficiency gains but lost out in terms of brand experience, they moved a bit further towards commoditised casual dining and fast food respectively – which goes against the brand equity that they have striven hard to build over decades.

Shop OS offers some advantages over Mobile OS, you can standardise on the hardware to reduce coding and testing requirements. It is ideal for tourists who may not want to roam on foreign mobile networks, nor be able to navigate free wi-fi offerings. The flip side is that there isn’t the same opportunity to capture customer data and behaviour, the notification screen on the smartphone is a key place for brands to intercept the customer using geofencing.

October 13, 2015
The Amazon Dash button post
At the beginning of this month Amazon launched an addition to their Dash ordering hardware with the Amazon Dash button. There was a lot of incredulity amongst the media heightened by the unfortunate timing which overlapped with April’s Fool Day.

Why the incredulity?

I would break the cynicism down into two broad buckets:
- The Amazon Dash button has a very singular usage / use case, narrower even the Yo! app which was a bit of a tech fad last year. Critics are at best uncertain that consumers would use them? I generally buy toilet rolls every 4-6 months, do I really need a button for that?
- The Amazon Dash button implies that the hardware required is ridiculously cheap. How many boxes of washing powder, packets of Mac & Cheese or toilet rolls would be required for a button to break even?
Business perspective

Rather than ripping into this into too much depth I thought I would share Benedict Evans’ interesting hypothesis about the Amazon Dash button:

Amazon is trying to eliminate both vendor and brand decisions, and turning itself into a utility company – get your house connected to power, water, gas and Amazon. And choosing which commodity product you need is just another piece of friction to be removed by Amazon’s kaizen

There are some interesting directions that come out of this view point. Let’s break Benedict’s analysis down chunk-by-chunk:
- Eliminating vendor decisions: there are two prongs to this. Firstly, it would reduce the basket size for supermarkets and also reduce impulse purchases. Let’s think about the Walmart ‘beer and diapers’ retail urban legend for a moment – if you weren’t shopping for the diapers, you aren’t likely to have picked up the beer next to it as you would have had no reason to go near those shelves. By implication it is also an attack on some of the categories carried in convenience stores. Given that the button is about ‘just-in-time’ shopping it implies that the users are not likely to have rooms in their lives for big box retailers or CostCo. The buttons are likely to aimed at urban dwellers rather than the suburbs were larger homes and larger vehicles to do the big box store shop are the norm – Sam’s Warehouse is safer than Walmart in this scenario
- Eliminate brand decisions: since sales are diverted from supermarkets this also affects their private label sales, especially where they are acquired by accident as lookalikes stacked next to well-known brands. Challenger brands find that switching becomes much harder as they can’t intercept the customer at the point-of-intent through shopper marketing and the opportunity cost for the consumer gets raised due to the comparative nature of the friction in purchase. It also begs a question about how much it affects the share price of WPP and other marketing combines who have spent big on shopper marketing acquisitions over the past few years. Do buttons offer a net gain or loss of value to them? I do know that the button puts Amazon in a much more powerful position versus vendors in terms of discount pricing to retailer and warehousing. The key to understand the power that Amazon would bring is ‘choosing which commodity product you need…’. The very idea of a product being boiled down to a commodity buy would scare the living daylights of the average brand manager in an FMCG mega-corp
- Turning itself into a utility: for Amazon this is about locking the consumer in via Prime to the consumer life. At the present time, logistics costs have been an increasing proportion of the cost of sales for Amazon, there must be a hope that the scale of grocery shopping will bring down the price of Prime and drive profits higher?
There is no reason why the likes of Tesco, Ocado or Iceland couldn’t have done this. The wider Dash technology would make it easier for consumers to do grocery shopping and reduce the friction of online purchases. Instead they seem to have wanted to reduce cashier numbers inshore and focused on self-service tills. Time will tell if they made the right technological choice.

What about the user?

This is designed to make the consumers life easier and I can see how it makes purchase of otherwise annoying to shop for items frictionless, but it only works within reason. You can’t have a wall of buttons on the front door of your fridge freezer and just when do you press the button in the bathroom to order up more razor blades or toilet roll? What happens during the run up to Christmas when Amazon has had sub-optimal performance with regards deliveries on occasion? What is the buying frequency required to make the button habit forming, used without thinking about it, without consideration. When does the opportunity cost for the consumer tip in their favour regarding button usage?

What I don’t have yet is a clear understanding on depth and breadth of the customer problem being solved by the Dash button.

Product design

The original Dash device was interesting because it represented a rejection of the broader theme of convergence where functionality is subsumed from dedicated hardware into a software layer running on a computer, via a web browser, tablet or smartphone. Instead Dash is a shopping appliance and wouldn’t look out of place in a cupboard full of Braun kit.

The Dash button represents a further evolution of specialist hardware, a brand-specific, tactile hardware interface. It mirrors software like IFTTT’s ‘Do’ application, the Yo! messenger app and the Dimple smartphone button project.

For non-food products like toilet rolls that come in a plastic bale that is quickly discarded, there may not be a barcode to scan in on your Dash device. Instead you would have to ask for a new pack of Charmin’ or more Mach3 razors. Processing each voice message is expensive, which makes the opportunity cost around creating dedicated buttons for certain classes of product much more attractive. Amazon first and foremost is a data-driven company, they will know which product categories that they want to have buttons for. However, what makes on an Excel spreadsheet doesn’t always make sense to the consumer…

More information

Amazon Dash button
Benedict Evans newsletter edition 106
Investing in smart logistics | Fidelity Worldwide Investments
Amazon, in Threat to UPS, Tries Its Own Deliveries | WSJ (paywall)
Supply Chain News: A 360-Degree View of E-Fulfillment Part 1 | Supply Chain Digest
Amazon joins numerous startups in building delivery networks to disrupt Fedex and UPS. | DataFox
The Amazon Dash post
Dimple smartphone button project | Indiegogo
SpinVox: the shocking allegations in full | The Kernel
April 9, 2015
O2O (online to offline) big in China

My friend Sam Sun used to flag up O2O as the most important trend he saw when we worked together on mainland Chinese campaigns. O2O means online-to-offline. An integration of digital marketing tactics with marketing to drive retail footfall.

O2O in China

In China, there is real consumer demand for this type of marketing. Tencent surveyed WeChat users and found out that 13 per cent of them would prefer to have O2O adverts in their moments (think a stream of friends Tumblr accounts or Facebook’s news feed).

There is a whole eco-system that the Chinese can tap into.

QRcodes have greater customer acceptance in Asia than in Europe, where despite the efforts of Pepsi and other brands to encourage consumer adoption, it has been tepid at best. QRcodes are often confused for barcodes and take-up is a fraction of that in other countries like Japan. By comparison here is the picture of a real estate advert on the table of a Chinese fast food restaurant in Shenzhen.

In-store wi-fi in the UK is often clunky, poorly run by a major carrier like EE or a specialist provider like The Cloud. By comparison, in China, Tencent’s WeChat provides a turnkey solution for retailers, restaurants and bars to provide wi-fi and build their social following in a relatively painless manner for the consumer. (Though the software used by the retailer needs regular updating to keep up with Tencent’s ambitious development of the platform).

On the face of it however China isn’t the most promising market for O2O. It is a vast, diverse country, which makes it hard to build a truly national network of retail outlets. It has a dominant e-commerce platform this is more like eBay than an Amazon in that it doesn’t compete directly with its merchants. Secondly, the cost of labour and the huge funds available to internet companies mean that building a logistics network is more likely to succeed than it would do in a more expensive country like the UK or US.

O2O in the west

Contrast this with the west, where Scott Galloway predicts Amazon’s demise because of the unsustainable cost of its product delivery system. Galloway hypothesises that ad-hoc logistics networks based on the sharing economy a la Uber and clicks and mortar businesses like Tesco offer a better alternative. Apparently doing the warehousing towards the edge is more cost beneficial than the Amazon model.

In the west, we seem to be on the cusp of a range of technologies that could make indoor location, identity and marketing a whole lot easier.

Hong Kong developers Green Tomato, have used ultrasonic signals and low power Bluetooth to allow applications to interact with their surroundings from sports check-ins to shopping mall navigation.

Low power Bluetooth beacons have been experimented with by retailers for encourage mobile augmented shopping and by organisations including Japanese Railways to aid indoor navigation. CSR and other companies have talked about using wi-fi as an indoor navigation aid. Further out quantum technology offers highly accurate GPS type location finding within buildings. All of this technology has the potential to further move O2O further forwards, if the user experience is made sufficiently simple and seamless. In the meantime the humble QRcode soldiers on connecting consumers and retailers in Asia.

More information

WeChat Adds Wi-Fi Solution to Public Accounts | Technode
China consumers voice their preferences for WeChat Moments ads | Resonance China
Proposes new indoor requirements and revisions to existing E911 rules | FCC
New indoor positioning system lets you do Batman-like echolocation on your phone | ExtremeTech
CSR claims it will be able to fix your indoor location accurately | VentureBeat
UK military creates quantum compass that could be the successor to GPS | ExtremeTech
JR Rolls Beacon Navi for Tokyo Station | Wireless Watch Japan – interesting internal navigation application of beacon (low power Bluetooth technology)
WiFi Chip Tracks Indoor Location | EE Times
Five examples of how marketers are using iBeacons | Econsultancy
Mapping Our Interiors – NYTimes.com – interesting business model by IndoorAtlas
Grindr – Lisa Page – HyperIsland – really interesting insights on LBS design
Green Tomato Limited

February 3, 2015
Adventures in retail

I have written before about my parents use of technology. This time I also found out more about their adventures in retail. I spent a little while with my parents in the UK over the past couple of weeks.

Using technology

Their use of television was frustrated by the electronic programme guide on their new set-top box.

But what can you expect in terms of user experience from a piece of electronics that cost 8.99GBP in the supermarket. The second thing that I noticed is that they had become much more comfortable with the iPad. I don’t mean in terms of the software, but in terms of how they related to the hardware. The device no longer had to be plugged into the charger when not in use; instead they were happy to leave it on the computer desk that I grandfathered to them and now doubles as their TV stand. In terms of television content my Dad is now addicted to Quest – a TV channel full of documentaries about large machines, treasure hunting with metal detectors and real-life forensic science cases. Dave TV which is basically old episodes of Top Gear on repeat is his substitute if there isn’t anything on Quest that he hasn’t seen before.

So I have managed to get my parents using technology, my Dad is most au fait with the touch screen interface of his TomTom sat navigation device. They also use an iPad (Facetime is preferred over Skype because of the easier interface design), but they draw the line at technology outside of the home.

We went to Birkenhead Park which has been transformed from a run down Victorian folly to something approaching the designers original vision for the space, but they couldn’t get enough money to resurrect the original hot house on the site which used to house plants from around the world.

It has been restocked with geese and ducks in the lakes and modern adult exercise equipment that seems to be unvandalised at the time of writing. Whilst we there we took some pictures, we also took some pictures when we went to the cinema and after having dug up some homegrown potatoes.

Adventures in retail

The adventures in retail started when the parents wanted these pictures printed which meant going to the supermarket and using Fujifilm’s touch-based kiosks to get the photos printed out. They were resistant to having the pictures in an electronic format on their iPad, the memories didn’t seem shareable and real by comparison in their eyes. Even my Dad was leery of using the touch screen of the Fujifilm kiosk, despite the fact that it talks you through on screen each process it wants the user to do. The interface was Flash-based and runs slowly, my Dad was anxious that he somehow managed to crash the console. So that fell to me to complete the process.. We also decided to do a little shopping there and I decided to brave the automated tills. This when things got really interesting. The tills are voice activated with a passive aggressive woman’s voice, and like the aggression shown towards the female sat nav persona on a previous visit home this did not go unchallenged by my Mum. A mix of coughing and ‘Are you sure that’s the right price, I didn’t think it was that on the shelf’ drowned out the audio instructions from the machine, so I had to takeover the buying process from them halfway through.

So what does these adventures in retail mean? It made me more aware (yet again) that interface designers are probably using voice in the wrong way. Devices like tills and kiosks don’t take account of how a machine talking to you exists in a social hierarchy and how they could make people more comfortable with it. I suspect that the way forward maybe to give the machine a distinctive voice of its own (think Stephen Hawking, rather than Siri).

Secondly, digital retail is inevitable, but again user experience and interface design needs to improve in terms of accessibility and performance.

More information

On the road 2

December 12, 2013
Independent coffee shops

I didn’t have time to try many of the independent coffee shops around Seoul but did try a few in Gyeongju and Ulsan. Here is a little about two of the best that I came across.

Cafe 737

Cafe 737 is a family-run coffee in the tourist town of Gyeongju. I loved it because of the vibe; as a third space it has a homely vibe that Starbucks can’t emulate.

The coffee shop greeter is an elderly golden retriever.

The restaurant itself is bright and clean inside with some nice touches including bric-a-brac, both English and Korean books and a selection of pot plants.

Even by the standards of the best independent coffee shops, they make a mean cup of coffee and had great food to accompany it. I would love this coffee shop as a regular hang-out.

They have their own page on Facebook.

Cafe 57

Cafe 57 is in the old town centre of industrial city Ulsan; the city has tried to spur redevelopment of the area by promoting businesses aimed at, and run by young people. This means that the area is full of restaurants, fashion shops and small coffee shops.

Cafe 57 has a clean minimalist interior with a black ash counter area and coffee bean roasting apparatus on the floor. What made Cafe 57 unique for me was the unswerving focus on making a great cup of coffee. It is not about a third space or a lifestyle expression of the consumer – it is just about making the very best cup of coffee available.

Watching the cup of ‘hand drip’ coffee being made by the owner was the experience of watching the craftsman at work. This was the best cup of Ethiopian coffee I have every had.

You can find more Korea related content here.

March 29, 2012