What are the opportunities in moving into this space? As Kevin mentions, it is a pretty low margin business and as Brittany mentions, it does not necessarily convert users to buyers. As a result, I am curious about the possibilities of the data that UA and Nike are able to collect through these applications. Unless the initial investment does not pay off immediately or directly, it is hard to figure the direct monetization opportunity:
“Still, while Connected Fitness makes up less than 2% of the overall business, its absence would have resulted in an increase of 47% in overall operating income. In the first quarter of 2016, Connected Fitness’ contribution to operating income was a loss of $16.5 million.” 
I do still believe in the idea that UA need to out-innovate, to get out ahead of customers. One boon this play could provide is in the women’s market, since women are more likely to use fitness apps . This could help prop-up UA’s business that otherwise historically catered more to men.
Ultimately, I hope they are able to leverage their data and community to create new and innovative products (like we saw in the Nike case) in order to have a self-reinforcing loop with its ardent fans. Given them even more to cheer about…!
First, as Evan mentions above, the defense and research side of the government has done quite a bit to advance technology. We must not forget that DARPA aided in the development of the Internet (with much contribution from many other scientists and visionaries) .
The current administration has actually done a fair amount in this space recently (perhaps never enough for our tastes, I recognize). The White House has created the first Chief Technology Officer of the U.S., sponsored Health Datapaloozas, backed robotics and wireless advancements, and opened access to data . That is not to say it is perfect, as noted above, but it is moving in the right direction; one such way is by starting a the Presidential Innovation Fellows (PIF) program to “bring the innovation economy into government, by pairing talented, diverse technologists and innovators with top civil-servants and change-makers within the federal government to tackle some our nation’s biggest challenges.”  When visiting HBS, I listed to PIFs explain present on their projects and I was quite impressed by these folks’ dedication to change-making through technology. One PIF was opening access to data (formerly protected), for citizens to use, for entrepreneurs to leverage for business, and for academics to use in their research. Another created profiles of Veterans to stitch together problems the government could solve to serve these folks better . I was struck by these Fellows’ dedication to the public sector, some staying on beyond their term to continue to enact change in their agency. While these programs are great instruments to attract talent, the government also needs to continue to foster change from within, to streamline and modernize its operations.
I look forward to seeing how this progresses, and hopefully some of us can have a hand in advancing the use of technology for the public good.
Thanks, Conor, for this interesting topic. The move of language learning to online/mobile platforms does not seem to be a great jump from the Rosetta stone audio era a decade or so back. I do find especially interesting 1) the effectiveness of such a pedagogy and 2) the monetization/use case.
On the first, as someone to whom second language learning did not come naturally, I believe that digital methods can be very helpful in making the routinized part of language learning (especially vocabulary memorization, grammatical conjugations, etc.) more engaging. Digital also seems to be a big boon for children, to get them excited and engaged. It also enables adults greater flexibility than having to show up at a certain class at a certain time. However, digital modes alone will not get people to language proficiency (think pronunciation, odd turns of phrase, grammatical irregularities, linguistic manifestations of culture…). The regular practice in person with a language partner or class (or full immersion) seems necessary, though digital services like duolingo can help interested individuals get part of the way there on their own time.
The monetization piece is also fascinating. First, it’s slightly frightening that they are using language novices to translate, but hopefully with a great enough n the group will prevail! Second, as you mention, it is quite reminiscent of (re)captcha’s orientation of solving a business need but also having a broader purpose, in that case captchas were used to digitize books. I am somewhat skeptical of web translation holding up as a revenue stream, but I am impressed by the model’s creativity (especially in today’s online ad-driven ethos). Others in the space, like Babbel, use freemium models to try to collect premium client revenue .
Ben, thanks so much for sharing. Memorial Sloan Kettering is a fabulous institution, and they have taken numerous strides (many of which you’ve noted) towards leveraging data and technology to advance oncological care and business operations.
Regarding Watson, I would be quite curious to hear about any outcomes-based studies that have been conducted. For instance, do patients get matched to their rare cancers more rapidly thus accelerating time to treatment and decreasing intermediary appointments? Do patients get spared unhelpful clinical trials because of their particular characteristics, thus saving them from unwanted side effects without the hope of useful treatment? Basically, what exactly has resulted from leveraging Watson aside from saving lit-review time? Moreover, I wonder how they and IBM are monetizing this opportunity.
John, this is an interesting manifestation of technology in the restaurant industry. I agree that there is a lot for Darden to celebrate: higher table turnover leads to higher nightly revenue (presuming they have the demand), higher per table spending results in higher tips, higher loyalty program reinforces this cycle.
My grandparents love Olive Garden and we had our first foray into the Ziosk tableside assistant world in the last year. I was quite curious how older clientele would react; while my grandparents were not exactly sure what to make of it, they were interested in completing the survey and in having the device notify our waiter when we needed something (extra breadsticks…). While there is still an initial hurdle to use to ensure it doesn’t alienate a base of its customers, as you mention, the traditional service is also available.
I would be interested to hear how waiters feel about the service- does it freeing up their time enable them to make more money and thus make them happy, or does it erode the value they thought they were providing, resigning them to an order taker/deliverer?
This also may have functionality to keep kids occupied at dinner, presuming parents are okay with their children playing games, and that one consul does not result in fights between kids.
Lastly, I wonder what value they will be able to derive from the data (not limited to but including the customer survey). Perhaps this will help bring Olive Garden to the next level.
As SM mentions, environmental altruism and investment is not necessarily top of mind for hospitals juggling regulations, contracting, disease outbreaks, and the like. However, I would think hospitals and climate change more from an energy approach. As Ben notes, hospitals consume energy running large facilities around the clock. Given their narrowing margins, perhaps hospitals can continue to decrease their energy costs to open up profit opportunities a little further. For instance, hospitals can ensure computers have sleep-modes enabled, can use light sensors, can schedule HVAC system servicing, and can use more efficient lights. While I know little about heat-capture, apparently incineration systems’ heat can be captured to produce savings, as the University of Michigan did to the tune of $400,000 annually – this does not strike me as an easy win, but exemplifies the creative solutions not only to benefit the environment but also the bottom line.
Also, a chart in Figure 2 of the U.S. Energy Information Administration (source ), shows interesting opportunities in conservation; the largest are HVAC maintenance and lighting conservation, but also options like multi-layer glass windows. Therefore, a hospital can be creative in how it makes a dent in climate impact while impacting its bottom line.
This piece reminded me of the finance concept we learned surrounding idiosyncratic vs. systematic risk. In distinguishing between these two concepts, our textbook gave the example of theft vs. earthquake insurance (p335), explaining how the former should be relatively isolated while the latter may be widespread. Interestingly, while the risk of each incident is about the same, the implications are quite different, leaving earthquake insurers holding (or supposed to be holding contrary to the article’s evidence above) large reserves to cover the possibility of a large claim. While the likelihood of payout was generally pretty small (earthquakes don’t hit all the time), when it did hit it was a massive payout. In this case, flood insurance is akin to earthquake insurance. However, I worry that the concept of insurance to protect against uncommon events will instead morph into a different version whereby events are much more common and premiums are high and therefore unaffordable, (presuming actuaries model this in and they can be increase the price, though I note CEA’s point above). There are many possible implications, ranging from more frequent claims, to unsustainable business model (as David points out), to lower coverage if rates in fact were to rise. This leaves neighborhoods at risk and local/state governments to pick up the pieces (via taxpayer dollars).
This is a very interesting piece covering a specific topic within a specific industry, yet providing a breadth of impacts and of possible actions (from efficient pot washing to saving 2M liters of water annually to IHG’s aerators reducing water per room by 10%). As you point out, the hospitality industry not only contributes significantly to resource utilization, but it also has many opportunities to improve climate change, and its own bottom line in the process.
You hit the nail on the head when addressing involving guests. First, education could help move the needle. As a hotel frequenter for my previous job, I was well-versed in water conservation efforts by minimizing towel replacement and sheet replacement cycles. The little card in the bathroom about water use was informative and altered my behavior, though it was not as specific as the stats that you provide around water shortfall globally and hotels’ consumption of water (not that hotels would necessarily explicitly state the latter to its guests). Nonetheless, as you point out, involving guests can reduce laundry by 17% (and I bet that number will only increase as norms change). More can probably be done with long-stay and repeat customers, like those on business accounts. As noted, some incentive systems I experienced beyond guests’ goodwill included points in exchange for not having housekeeping (both to cut down on water utilization as well as labor costs). While I do not know specifically what can be done around length of showers or water utilization during showers, perhaps there are techniques to impact guest behavior in that realm as well, whether it be through an aerator-type approach, a lower water pressure the longer in the shower, or some other permissible but effective signal. Tactics like this may help share the effects between hotel and consumer, to amplify the hotels’ efforts to reduce resource utilization (while improving their bottom line).
First, I like how you bring color to the situation and shed light on the various players impacted. For instance, commonly when we consider institution-level impacts, we forget that of the individuals doing the work… you so vividly paint that image for us: “Imagine people out in jungles in the blistering heat, holding machetes, and hacking down watermelon-sized beans that are hanging from trees.” That is the existing nature of the work, only to get more extreme as climate change continues to impact our planet. Moreover, it was great that you pointed out how not only Hersey will be affected (and can mobilize its resources), but also how “the collection of small-time, individual growers that make up the cocoa farming industry” will have so much more difficult of a time given their lack of deep pockets and resources.
Regarding the future impact to businesses, clearly the price of inputs is of large concern to chocolate producers, given the supply information provided here and the price movements in Figure 2. Do the big players (Hershey, Nestle, etc.) want to get more heavily involved in the upstream production? Is there significant money for innovation or R&D in upstream production? Is there automation efforts or climate-controlled possibilities to cocoa production? Like many of these issues, I hope this is resolved, as I cannot imagine life without chocolate, or an $8+ bar of chocolate. Thanks for illuminating this issue for us.
Thanks for writing about this; it is very interesting and relevant to the ~80% of Americans (by Reuters’ reporting, estimates vary) who live in cities, with similar implications across the globe. Much more can be done to improve Boston’s rail-transit systems’ climate change readiness efforts, beyond the more altruistic acts of emission, water, and energy use reduction. I liked how you pointed out the MBTA’s surveying of high-value assets at risk to prioritize adaptation efforts. Additionally, while not easily enhanceable, drainage systems can be used, like in New York, to reduce the impact of flooding. For instance, “the New York subway uses 700 pumps that typically drain on average around 50 million litres of water (nearly 20 Olympic-sized swimming pools) a day from the network”; even that is not sufficient when hit by Hurricane Sandy, but bolstering drainage is one mechanism to improve upon. Moreover, the Department of Homeland Security’s Science and Technology Directorate developed a “giant plug” in 2012 that could aid in containing water spread through subway tunnels. Innovations like these will help shield public transit providers from the continued and increasing impact of climate change on their business. Thanks again for posting about this interesting topic.