This is so interesting! Wealth management industries particularly hedge fund and mutual funds are facing massive secular headwinds as millennials are increasingly distrusting active investing managers with high-fee structure and opting for DIY. Robo-Advisors actually do not present any new investing strategies, but rather create an interface and its own diversification algorithms to invest in passive ETFs, which are already accessible to everyday investors with an even lower fee structure. But the value that Robo-advisors provide is an easy-to-use online interface, further lower capital requirement (by pooling all smaller lots of investments), additional layer of diversification ( its so-called “algorithms”), and a popular mobile app concept that appeals to millennials. This approach reminds me of Lending Club model, which provides an easy-to-use online platform to pool different borrowers and lenders with diverse risk profiles together. I also agree with Ari’s comments that I am bit skeptical of the robustness of its compliance and risk control system in case of any adverse events in the market. As we know, we have been in a super long cycle of bull market since 2009 which creates the illusion that layman investors should simply buy passive funds and will generate returns without paying much fees. This illusion has also given rise to the fast growth of the passive investing we are seeing today. However, when we enter the bear market, risk control becomes the most important aspect in wealth management. I am a bit skeptical of what mechanisms are in place for such online apps which emphasize on automation and limited human intervention… During a market crash, a low fee structure is no longer relevant compared to loss of original capital….
Really thoughtful proposals for NYT’s next revolution in the digital information age! I completely agree that the advent of internet makes print seems obsolete but on the other hand, there is an increasing scarcity of original and quality content on the internet. For players such as NYT actually has great competitively advantage from its quality and trustworthy content.
I agree on the customization strategy. With all kinds of online distractions in our life, readers are increasingly having less time to read everything and only focusing on their interest areas such as politics, finance, sports, etc. However, as a paper newspaper reader, I really enjoy the pleasure of reading something unexpected on the paper. When I go online, I feel that spontaneity and fun of discovery completely disappear. The recommendation of NYT even makes this worse by only pushing me articles in the area that I normally would read… Sometimes I feel overwhelmed by the similarity of all the articles showed up on my “customized” list. I think, as print continues to lose favor, NYT should really think how to best leverage its data on users while trying to transition some of the authentic experience from paper reading to online instead of being a cookies tracking manics to make readers even more constrained in their own interest.
Interesting post! As Hugh mentioned, if this can create more customized coupons through the digital screens for different customers (using LBS information), customers will benefit as well in this process.
I am also interested in how this digitalization of price information will help the supermarkets to manage inventories and reduce waste. This post reminds of the TOAST app Nick wrote about on the POS system. If supermarkets can collect the data real-time including the price information, actual quantities sold at the check-out, loyalty customer purchasing behavior, and etc, they might also be able to run a dynamic analysis of the supply and demand model with consideration of inventory turnover to adjust price frequently. And in this way, supermarkets can further reduce cost of labor time, make quicker and smarter decisions on inventory purchase, and in the end offer even fresher and better value products to consumers. It seems a “win-win” situation.
This is a great post and offers interesting online real estate verticals’ opportunities and challenges. I used to analyze online real estate verticals such as Soufun and Leju to assess how such offline to online transition would transform the industry and impact the traditional models. Surprisingly, online real estate players such as Soufun which started the model online and aggregated huge internet user acted more as a marketing agencies for the real estate developers and secondary real estate agencies. However, it took them several years to realize that the pure online model was not sustainable, as the house-buying transaction was a mostly offline experience. The online platforms themselves barely offered much value beyond a discovery channel. Opposite to Lianjian’s strategy, Soufun started to build offline agency business. It is so much harder to transition from online to offline (asset-heavy) versus the vice versa. On the other hand, we are seeing the traditionally offline player like Lianjia built its online presence and created a lot of synergies from its online business to complement its offline agency business. I am wondering if the online model can further shape internet users’ behaviors and move the transactions online? If this is the case, then there is also a great potential to expand into online payment/credit lending business as well?
This is such an interesting post on the smart trash cans, and I started to realize that we have some on the HBS campus! It is fascinating to see how small and simple digital sensor with wireless connections can revolutionize a traditional practice and drive efficiency! Instead of BigBelly expand beyond the waste management industry, I am wondering if it can go deeper to solve more issues within the same industry. In particular, how can smart trash cans provide information to help drive people’s recycling habits. A common problem is that many people do not know what items count as recycles versus what do not. And the different standards and systems employed by different cities cause further confusion. I am wondering if smart trash cans can work with government to develop a “barcode” on the cycled items’ packaging and incorporate the identification systems on the trash cans. People can simply scan the barcode to see if the recycles will be admitted or not. In this way, it can generate possibilities of more specific recycled categories, save a lot of sorting efforts on the government end, and educate people more on recycling knowledge.
Really GREAT post! I feel so hopeful after reading how LSAUSD is leveraging its own position in the society to raise awareness. What’s great about LSAUSD is its consistency in advocating for taking active steps to counter climate change. It understands how school operations could generate carbon footprint and proactively retrofit buildings in its real estate portfolios. This not only sends an important message to the public, but also reinforces how the school is acting as a role model to the students when it teaches them how to be problem solvers in the next few decades about climate change. Last but not the least, pushing for even earlier adoption of climate change education in its curriculum and developing a content strategy with hands-on perspective are probably one of the most effective ways to develop future responsible citizens and business leaders who carry the increasing responsibility to counter climate change.
This is a good read. It is a very difficult dilemma – choosing between fast economic development to drag population out of poverty & hunger and producing more conservatively to be gentle on environment. I’ve been thinking about this question a lot. China apparently was the center of the criticism for being the largest carbon dioxide emitter in the world while being more reluctant to give up this economic imperative in exchange of better environment. Before I would say, making sure people are alive in terms of food and basic need access is more important. However, now seeing how a polluted environment in terms of air and water impacts every citizen’s life on a daily basis makes me change my mind. Un-sustainable economic development at the expense of the environment will come back and haunt us, and probably at an even greater expense. Now, sadly, when there is no more blue sky, we just realized that how little we can do to make the blue sky come back. Even if we stop the factory production, it does not help. Therefore, I completely agree with you that growth with a focus on sustainability and a harmonious relationship with environment is so important especially for large state-owned companies. These companies are not only responsible to spur economic growth for the whole country, but also to set itself as role model on how to maintain a sustainable future.
This is an interesting post on a quite counter-intuitive product. It almost seems that the Citizens is part of the government’s welfare system to subsidize disaster reliefs to its citizens. What it means is that, such policy product would not exist in a free market because the payout number and % must be so high to offset any premiums collected collected at affordable levels. Maybe that is also why there is not much private insurance options. Due to the high frequency of disasters in this region, there is simply no insurance algorithms to work to make it an economically viable product. On the other hand, because of the climate change, this insurance bearer – the government – has no choice but to withstand all the financial impact caused by the climate change which seems to be only getting worse and worse each year. No wonder that the government has to increase the premium by 8-10% every year and is still looking for private insurance players. I question if this policy is an efficient use of the government capital to deal with climate change (no proactive measures in this case) or disaster relief itself. By offering the insurance, it simply does not de-incentivise people to purchase homes in risky areas that are more prone to future disasters from climate change. And as a result, the government is losing more money on this product and having less money on other disaster relief initiatives.
Great post! It touches the topic of impact investing in environmental causes. I think there are increasing number of investors who are willing to trade off some returns for social causes especially in enviromental related issues which affect everyone one the planet. The impact investing industry is also growing tremendously, but still, it is only 60 billion AUM out of 11 trillion dollars private investment management industry. (https://thegiin.org/impact-investing/need-to-know/) I think, the challenge here for attracting more private capital, is two-fold – how to demonstrate returns and how to measure these environmental-related results post investment. Interestingly, on average the past impact investments are generating roughly 7-8% return which is completely isolated from stock market while having an impact. Nevertheless, in order to grow this industry, we need large global players like Morgan Stanley to help promote, increase awareness, and more importantly, to provide a platform as said in this article to improve access for investors both large and small to participate in environmental initiatives that impact us on a daily basis.
It is so interesting to see the systematic patterns of early ripening across different wine types from 1993 to 2005.
– The post explains well that part of the reason was due to rising temperature from climate change. However, I am wondering if there are any other external factors such as development of agricultural practice or any change in quality of resources that could also contribute to the shifting of the ripening time outside climate change.
– No doubt that the climate change is impacting the wine industry in quite significant ways. When companies implemented these reactionary counter-measures such as better supply chain management or technology advancement, I am wondering if they are also reflecting on how their past growing practices have generated carbon footprint which indirectly exacerbates the climate change. Are the companies becoming more self-aware and become more proactive to change their production process to reduce their own carbon footprint along the way? For example, when they sell a previous wine growing land for a new one in southern and cooler areas, are there any consequences of rising carbon footprint due to such land replacement strategies?