Great point, Micah, and thanks for the update on Amazon’s actions. I think their move to abandon owning their own alcohol licenses was smart on their part. Moving to a hybrid model allows them to offer a similar service to Drizly at much lower headache to themselves. If I’m Drizly, my biggest worry would be losing customers who are already shopping on Amazon for other on-demand items. As Amazon roles out more of these features (like it’s partnership with Eataly referenced in the article you posted), it will make more sense for customers to use Amazon as a one-stop-shop for all their on-demand purchases. This means highly concentrated cities, like NYC, may fall Amazon’s way (since they’re the easiest places for Amazon to execute 1-hour delivery). Other dispersed metro areas, e.g. Atlanta, may still be better served by Drizly. It’s a bold strategy, Cotton. Let’s see if it pays off for them.
Aditya raises two great points. A business model that loses users if the product is successful doesn’t seem sustainable. Unfortunately, it seems like this isn’t a problem – user numbers are growing, which could imply one of two things:
1) Tinder isn’t an effective tool to achieve it’s goal of romantic connectivity. or
2) Tinder is effective, but success is defined by leading to a short term romantic connection, after which the user returns to the app.
I believe the latter is what’s going on here, which leads to my main issue with the app: it risks being branded as a “Hook Up” app. Maybe Match knows that, and actively positions Tinder in that way. However, this leads to some degree of social stigma. There seems to be a fine line between social media sites / apps that help users find relationships, and those that merely seek to generate short term connections. There’s a nuanced difference between saying, “We met on Match.com” and “We met on Tinder.” This doesn’t mean their business and operating models are misaligned, but I do think that stigma is something Tinder should avoid.
Sounds like LLB has carved out a great position with their high product quality and customer service. My biggest concern is future growth potential for the brand. You mentioned Bean Boots enjoyed a recent surge in popularity over the last year or two. But I’d be uncomfortable as LLB basing my long term projections on the hope that the boots return to popularity after the inevitable fade. While the company clearly makes more than just Boots, the salient point is LLB doesn’t prioritize innovation in their product line. They sell their boots, flannel, and other New England staples. Is that enough to create value going forward, or do they need to start rebranding as the preferred clothing option for both traditional and modern New England? Maybe they should focus on getting a CEO with a name as good as “Leon Leonwood.”
The issue of value capture by musicians has been pretty interesting to follow since the launch of Napster and the rise of file sharing. Unfortunately, there is somewhat of a catch-22 that musicians face when trying to build support and spur action for their cause: the musicians that are materially affected by file sharing and, more recently, free music streaming are typically lesser-known and thus do not command a large enough fan base to result in much meaningful change. On the other hand, big-name artists, like the ones behind TIDAL, are so wealthy, it’s hard for their message to ring true with their millions of fans. Thus, the artists that are big enough to make a difference don’t lend enough credibility to the problem. Hearing Jay-Z claim we need to return more value to artists, and then watching him and Beyonce fly off in a private plane (conjecture, no source) doesn’t motivate me to pay $10 a month.
The short answer to this problem would then be “let’s get every single artist on TIDAL so we can leverage large fan bases and credible claims for more value.” But, as you point out through Enders, music should be everywhere. At the end of the day, it seems Jay-Z et al have ultimately mirrored Metallica’s response to Napster from ~15 years ago – refuse to adapt to changes in user (fan) behavior. Free streaming is here to stay. Music artists needs to find a way to leverage changing technology to capture more value, not fight it. Instead of milking more value out of their fans, maybe they could take some of it back from the record labels? Who needs those guys?