Innovating the Toyota, and YouTube, Way

 In terms of people, processes and technologies, Toyota and Google's YouTube have little in common. As global innovators, however, they share a remarkable core value and best practice: they invest in the innovative capabilities of their suppliers. They don't just partner; they provide resources that add value.

USA Today ran an excellent — if over-flattering — profile of YouTube's splashy but serious effort to provide a high-tech incubator for content and channel creators. The Google unit calls its 41,000-square-foot state-of-the-digital-art playpen the Space. To start, a specially selected class of 25 artists — each with between 10,000 and 300,000 YouTube channel subscribers — was given the run of the Space.

"I just tell them, 'Please make something great,'" says Liam Collins, who oversees the Los Angeles facility, told the paper. "We provide the space, equipment and expertise. They provide the talent."

By sheer happenstance, I had just gotten a copy of Gemba Walks, a collection of essays by James Womack, a co-author of the automotive classic The Machine That Changed The World and a pioneering importer of Toyota-inspired lean production insights and methodologies to America. Because he and I have taught executive education classes together, I thought I should read his book.

The more deeply Jim's essays discussed the nature of supplier relationships, work-flow and value creation in lean enterprise, the keener the connection with YouTube's Space. While lean production has almost nothing to do with video production, the clear message was that genuinely lean enterprise craved innovation that made their suppliers more innovative. Toyota wasn't just looking for superior quality and just-in-time inventory management from suppliers, they were vested in helping suppliers become more innovative and creative. Toyota was prepared to educate and train its suppliers to embrace lean production and lean experimentation techniques and insights. (Toyota's successful relationship with high-tech sensor supplier Tamagawa Seiki beautifully illuminates that innovation investment theme.) Toyota was prepared to help its best suppliers scale.

That's exactly the investment YouTube is making: helping its suppliers creatively scale. Organizations don't — and shouldn't — accomplish that by dangling financial incentives and lures. These investments are more about the development of human capital than finance. Access to innovation resources and skills matter far more than money. I recently wrote an ebook asking Who Do You Want Your Customers To Become? The strategic/ cultural question here is "What kind of innovators do you want your suppliers to be?" The answers will determine if and how (much) you invest.

For a YouTube and a Toyota, it's blindingly clear and obvious what investing in a supplier's innovation capabilities can mean. What does it mean for your company and industry? What should it mean?

For one marketing services firm, it meant being exposed to their biggest client's development teams and sitting through technical tests and focus groups to better appreciate and understand how its products were actually designed and built. For stock exchange personnel, it meant sitting through demos and simulations from a high-frequency, algorithmic trading firm intent on communicating how technology could improve efficiencies and liquidity. For a materials company, it meant going out on maintenance calls with a huge public utility. In each case, the client was intent on giving its vendor access, software and/or other resources that put the vendor in a better position to come up with better innovations.

Obviously, innovation investments shouldn't make it easier for suppliers to compete with or disintermediate their customers. Building a supplier's innovation capability is not to undermine your own. The goal is creating healthier and more vibrant innovation eco-systems — ones where suppliers feel clients are genuinely interested in making them better and stronger.

Who knows if the Space will — God forbid! — facilitate the next Gangnam style video. Or whether Toyota's ongoing efforts to create more "environmentally correct" vehicles will lead to meaningful breakthroughs in fuel cells or "natural gas" powered cars. But there's no avoiding the cultural fact that these organizations are prepared to invest in making their suppliers more innovative. (Does Apple similarly invest in its suppliers? Half the people I know at that secretive innovation icon say, "Of course — but on our terms". And the rest won't talk....)

"Open architecture" and "open innovation" approaches are wonderful. But whether they offer the best possible investments you can — or should — be making in your suppliers is probably unclear. Reading the YouTube story and Jim's essays reinforces my belief that there's a very thin line between investing in "continuous improvement" and "continual innovation". Smart firms invest in both. Innovative firms innovatively invest in their suppliers

Rise of Point-to-Point Delivery Vs hub & spoke model for distribution

Today, hub-and-spoke accounts for 99 percent-plus of all deliveries worldwide. 

With ecommerce, orders are collected from a retailer’s warehouse and brought back to a hub where they are sorted, before being distributed onto multiple vehicles running delivery routes the next day. 

Hub-and-spoke is the dominant logistics model because it is the only cost-effective way of sending a package over 10 miles. The downside of hub-and-spoke is that it is not very flexible. Delivery times are determined by other deliveries within the network and on a delivery route.

Things get interesting when deliver distance is less than 10 miles. 

Over short distances it can be cost-effective, often even more cost-effective, to send a courier straight from collection to delivery, point to point. 

Unlike the hub-and-spoke market which is dominated by UPS and FedEx, the point-to-point market is highly fragmented with thousands of local operators.  

Since pure-play online retailers such as Amazon tend not to locate their warehouses in densely populated areas for cost considerations, very few orders would be sub-10 miles and therefore relevant for point to point. Multichannel retailers, however, already have very local warehouses: their stores. 

Multichannel weaponAmazon fights and wins on product range and price – battlegrounds that multichannel retailers have no hope of competing on in the long-term. 

Multichannel retailers are structurally disadvantaged by their stores, which limit the SKUs they can stock and are a significant cost base that must be paid for out of margin.  

Even with the investment Amazon is making in local infrastructure to enable faster delivery, it will never be able to use point-to-point to offer extremely fast or flexible delivery times at a reasonable cost. 

Local infrastructure for Amazon means depots in every state, not every town.   Immediate and convenient delivery can be the multichannel retailers’ competitive advantage.

Using store networks as a weapon against Amazon is nothing new for today’s successful multichannel retailer. These are the merchants that have already invested in their bricks-and-mortar presence within strategic markets and integrated systems that link Web, mobile and stores, pushing the boundaries of customer experience. 

Click-and-collect has been the greatest driver of multichannel growth over the last five years, which for me begs the question: how much of its popularity comes down to dissatisfaction with delivery? Surely shoppers would prefer to get their orders delivered to them – where they want, when they want it? 

If you believe so, it gives you a sense of the opportunity. The U.S. business-to-consumer delivery market, driven by online and now mobile commerce, is set to top $26 billion by 2016. Expect 20 percent-plus to come from point-to-point.

Point-to-point checklist
To take advantage of point-to-point delivery from store, a multichannel retailer requires:

• Systems that provide accurate visibility of in-store stock: Made available on the Web site and provided the capability to send online orders to stores.

• A flexible store operations team: Who can pick and pack orders throughout the day on an ad hoc basis.

• A strategic store network: One with a sufficient number of stores in close enough proximity to a high enough proportion of customers so as to make a meaningful impact on the business.

• A fulfillment partner: Who can integrate with existing systems and provide a consistent quality of service that wows customers.

Not all retailers will be able to overcome the challenges, but those who do will reap the rewards. 

Tom Allason is founder/CEO of Shutl, London. Reach him attom@shutl.com.

Online logins verified via smartphone

Earlier this year we wrote about Keyfree Login, a browser add-on that unlocks users’ online accounts only when their cell phone is in proximity. Now, a Las Vegas-based startup – LaunchKey – is hoping to make passwords redundant by verifying logins through smartphones.

Using LaunchKey, accounts are linked to the users phone. The username is typed in when logging into a site and – instead of a prompt for a password on the screen – a notification on the handset appears. In order to proceed, a button is pressed to confirm the login or cancel the request. Security is increased due to the fact that users need to have a second device present to log in and receive a notification if someone else is trying to access their account. It also means that sites would no longer have to store user passwords in locations that have the potential to be hacked. The following video explains the startup’s ideas more fully:

Although there are potential flaws with this model – it is unclear how users can login if they leave their phone at home or it runs out of battery – could this be the future of online security?

How to Allocate Your Time, and Your Effort

As Tom Rath wisely explains in his StrengthsFinder books, you can achieve more success by fully leveraging your strengths instead of constantly trying to shore up your weaknesses. Realizing the importance of purposely deciding where I will invest more time and energy to produce stellar quality work and where less-than-perfect execution has a bigger payoff has had a profound impact on my own approach to success and my ability to empower clients who feel overwhelmed.

As I talk with time coaching clients struggling with overwhelm whether they be professors, executives, or lawyers, a common theme comes up — they can't find time to do everything. And, they're right: no one has time for everything. Given the pace of work and the level of input in modern society, time management is dead. You can no longer fit everything in — no matter how efficient you become. (This conundrum is what inspired me to write a book on time investment).

In my time investment philosophy, I encourage individuals to see time as the limited resource it is and to allocate it in alignment with their personal definition of success. That leads to a number of practical ramifications:

• Decide where you will not spend time: Given that you have a limited time budget, you will not have the ability to do everything you would like to do regardless of your efficiency. The moment you embrace that truth, you instantly reduce your stress and feelings of inadequacy. For example, professionally this could look like reducing your involvement in committees, and personally this could look like hiring someone else to do lawn maintenance or finish up a house project.
• Strategically allocate your time: Boundaries on how and when you invest time in work and in your personal life help to ensure that you have the proper investment in each category. As a time coach, I see one of the most compelling reasons for not working extremely long hours is that this investment of time resources leaves you with insufficient funds for activities like exercise, sleep, and relationships.
• Set up automatic time investment: Just like you set up automatic financial investment to mutual funds in your retirement account, your daily and weekly routines should make your time investment close to automatic. For example, at work you could have a recurring appointment with yourself two afternoons a week to move forward on key projects, and outside of work you could sign up for a fitness boot camp where you would feel bad if you didn't show up and sweat three times a week.
• Aim for a consistently balanced time budget: Given the ebbs and flows of life, you can't expect that you will have a constantly balanced time budget but you can aim for having a consistently balanced one. Over the course of a one- to two-week period, your time investment should reflect your priorities.

Once you have allocated your time properly, you also need to approach the work within each category differently. As I explained above, trying to "get As in everything" keeps you from investing the maximum amount of time in what will bring the highest return on your investment. That's why I developed the INO Technique to help overcome perfectionism and misallocation of your 24/7. Here's how it works:

When you approach a to-do item, you want to consider whether it is an investment, neutral, or optimize activity. Investment activities are areas where an increased amount of time and a higher quality of work can lead to an exponential payoff. For instance, strategic planning is an investment activity; so is spending time, device-free, with the people you love. Aim for A-level work in these areas. Neutral activities just need to get done adequately; more time doesn't necessarily mean a significantly larger payoff. An example might be attending project meetings or going to the gym. These things need to get done, but you can aim for B-level work. Optimize activities are those for which additional time spent leads to no added value and keeps you from doing other, more valuable activities. Aim for C-level work in these — the faster you get them done, the better. Most basic administrative paperwork and errands fit into this category.

The overall goal is to minimize the time spent on optimize activities so that you can maximize your time spent on investment activities. I've found that this technique allows you to overcome perfectionist tendencies and invest in more of what actually matters so you can increase your effectiveness personally and professionally.

On a tactical level, here are a few tips on how you can put the INO Technique into action:

• At the start of each week, clearly define the most important investment activities and block out time on your calendar to complete them early in the week and early in your days. This will naturally force you to do everything else in the time that remains.


• When you look over your daily to-do list, put an "I," "N," or "O" beside each item and then allocate your time budget accordingly, such as four hours for the "I" activity, three hours for the "N" activities, and one hour for the "O" activities.


• If you start working on something and realize that it's taking longer than expected, ask yourself, "What's the value and/or opportunity cost in spending more time on this task?" If it's an I activity and the value is high, keep at it and take time away from your N and O activities. If it falls into the N category and there's little added value or the O category and spending more time keeps you from doing more important items, either get it done to the minimum level, delegate it, or stop and finish it later when you have more spare time.


• If you keep a time diary or mark the time you spent on your calendar, you can also look back over each week and determine if you allocated your time correctly to maximize the payoff on your time investment.

Sprooki

Singapore-based Sprooki is a location-based mobile commerce service that lets retail shops send targeted messages and promotions to potential customers who are passing by via their smartphones. The startup recently announced that it will be partnering with YFind Technologies to offer indoor positioning technology within its mobile, location-based platform.

From Zipcar to the Sharing Economy

Avis has taken an interesting (and bold) step by acquiring Zipcar, absorbing an innovative but struggling competitor at what is likely to be seen as a bargain price while acquiring a small but desirable customer base and gaining a foothold in the rapidly growing world of collaborative consumption.

Sadly, the Zipcar culture may not survive the merger. But in the world of new "sharing economy" models that generate efficiency gains, theirs is just the tip of the iceberg. True, they pioneered the creative use of technology to open up flexible new ways of renting a car. However, although their members can rent the (more urbane and green) Zipcar fleet by the hour and pick up their vehicle at a local parking space using a smartphone app, this is still a dedicated fleet, still inventory that the company has to acquire, manage and monetize. Under the hood, the business model is fundamentally not very different from that of a traditional rental car company.

Contrast Zipcar with RelayRides and GetAround, both genuine peer-to-peer car rental marketplaces which tap into the existing (and massive) installed base of cars that people already own. These marketplaces don't need to carry inventory. Their business model advantages are clear — the "fleet" renews itself naturally, there are no parking or logistics issues, geographic expansion and scaling is more seamless. Reputation systems and active supplier screening maintain quality, and the need for insurance keeps customers from bypassing the marketplaces.

Relayrides and Getaround are just two of a host of companies — Airbnb, Lyft, Sidecar,carpooling.com, Snapgoods, and TaskRabbit, to name a few — that are dramatically expanding the set of industries susceptible to transformation by information technology, taking its impact well beyond familiar (content) industries like music, movies, and books.

Furthermore, these "peer economy" marketplaces transcend the simple trade conducted on eBay, and are instead inventing an entirely new asset-light supply paradigm. They enable the disaggregation of physical assets in space and in time, creating digital platforms that make these disaggregated components — a few days in an apartment, an hour using a Roomba, a seat in your drive from Berlin to Hamburg — amenable to pricing, matching, and exchange.

Accompanying these peer economy companies are others (like Zipcar) which simply leverage technology and lower transaction costs to make flexible renting a viable alternative to asset acquisition. (One of my favorite classroom examples is GirlMeetsDress.) Collectively, they're spawning a range of efficient new "as-a-service" business models in industries as diverse as accommodation, transportation, household appliances, and high-end clothing.

This "reengineering" of consumption is a natural consequence of the ongoing consumerization of digital technologies. Think back to the 1990s, a decade after corporate PCs and client-server became commonplace. Led by the writings of Michael Hammer and Tom Davenport, firms realized that they didn't need to organize work the way they used to. Instead, they could leverage new information technologies to reengineer, reorganize and radically streamline their production and service delivery. Although Hammer's mantra of "Don't automate, obliterate" may have induced process redesign overkill for a while, an important lesson emerged: The returns from digital technologies are amplified dramatically when they are used as enablers for the fundamental reinvention of old processes and models (rather than to speed up existing ways of doing things, or simply for conducting entirely new activities).

Today, a decade after the launch of the iPod, consumers are starting to reach the same realization. Our mobile devices are powerful computers connected to high-speed networks. The digitization of social brings real-world trust and social capital online. We are comfortable with the notion of commercial transactions mediated by computers or smartphones, and we've had over ten years of experience with the idea of semi-anonymous peer-to-peer exchange.

So the reengineered consumption models of the sharing economy are now well poised to go mass-market, and the battle cries of Hammer and Davenport won't be necessary this time around. While the marketplaces that facilitate sharing and peer exchange do begin at the fringes, they will spread organically among consumers as their value proposition becomes apparent. If you don't need to own the assets you use, not only do you spend smarter, but your product variety and quality options expand quite dramatically.

In 2013, corporate America will need to pay very close attention to this new paradigm. The terms "collaborative consumption" and "sharing economy" might seem more reminiscent of flower power than of Gordon Gekko, but the business threats they embody are very real. For companies in a growing number of industries, it's no longer sufficient if you leverage digital technologies to rationalize and optimize your internal production. If your business relies on a model of consumption that is inefficient for your consumers, chances are that there's already a new sharing economy marketplace that is looking to streamline it for them.

To Spur Growth, Target Profitable "Prosumers"

"Prosumer" is a word you probably have seen in the camera category. A prosumer camera is one that is borderline professional grade but a price point in between a consumer camera (few hundred dollars) and a professional camera (few thousand dollars).

My parents faced a prosumer dilemma when my viola teacher in high school noted that for me to better compete on the national level as I had started to, that I'd need a higher quality instrument with a four-to-five-figure price tag vs. a three-figure one. In my teacher's mind, it was an investment in a future career. In my parents' minds, it was an expensive and unnecessary luxury. But my parents gave in, and purchased a beautiful viola that helped me sit 1st and 2nd chair in high school and college respectively, but doesn't help in my consulting career. My viola sits in my den now, waiting for the occasional request from my kids for me to play it.

I can't help but think that if a ZipCar for prosumer quality string instruments existed, everyone would have been better off. I spoke with Andy Fine of Fine Violins in Minneapolis, who says such a service doesn't currently exist as far as he knows. "It makes perfect sense that this service should exist, especially for up and coming students and musicians," he told me, "But I'm not aware of anyone doing it today." He confirmed that the typical model for the highest end instruments is for a benefactor to "loan" a $100,000+ instrument to a professional who uses and cares for it. For my limited music career, I would have been well-served by an intermediate option — my parents would have written a smaller check and my instrument would be employed by someone who can make better use of it now.

Prosumers are similar to super consumers in that they are a small portion of total consumers, but represent a disproportionate level of category profit, though at an even more extreme level. The main distinction is that a prosumer has either some professional training or career/economic interest in the category.

Prosumers can be the guide to finding unmet demand on the price/value curve. By finding distinct buyers who are willing to pay more, accentuating your product's cachet via the right professional endorsements, and finding key upgrades with minimal cost of goods or delivery system, you can command much higher prices. For example, UnderArmour provides athletic gear used by professional athletes to the masses. Almost Family provides professional hospital nursing care in the comfort of your home for a tenth of the cost. Costco and Sam's Club allow consumers to buy great quality and a better bulk price like a business wholesaler. Roche allows you to monitor and manage your own diabetes like a doctor.

Prosumers help unlock at least three different kinds of demand. First is when professional products are far superior to its consumer versions. Both UnderArmour and Roche are great examples of this. The average consumer did not have access to the quality of equipment that professional athletes and healthcare providers had, until breakthrough innovation created higher quality yet affordable options.

Second is when there the profession has badge value and cachet. Professional athletics certainly fits the bill with the emergence of professional race car driving schools ($2,000 for the day) and professional athlete fantasy camps (Michael Jordan's basketball camp cost $15,000 in 2010). Professional chefs have also grown in cachet, and hence so have professional kitchen brands like Viking and Sub Zero.

Third is when there is latent demand for do-it-yourself (DIY) vs. paying a professional. This can be when there is dissatisfaction with the professional quality or cost, or when there is inherent enjoyment in DIY. Home Depot and Lowes can describe both of the above. As might retail investor services, which has led to the rise of Schwab and E-Trade.

These last two areas of demand are key to why Prosumers are great for category creation, which I've previously defined as the intersection of breakthrough product innovation and breakthrough business models. Specifically, they're not just interested in the breakthrough product, but also have demand to be involved in the delivery of the benefit. Sometimes they want to be involved in manufacturing ("how you make it"), so they can customize it to their needs. They also want to be involved in distribution ("how you move it"), as BMW/Audi Prosumers who love to travel to Germany to pick up their cars from the factory for extra immersion before shipping it back home. They also are finicky about marketing ("how you market it")...sometimes the badge value comes from the product not being mass marketed, but rather endorsed by those in the know. And they are far more receptive to innovative pricing/profit model ("how you make money from it"). Subscription, service and other innovative pricing/profit models are very much in play, as it often increases the access to the benefits prosumers seek.

My experience is that Prosumers are usually lost in the shuffle, as companies focus on the vast consumer market or the big ticket big business/B2B market. But Prosumers can be a profitable, and innovation-driving, segment of your customer portfolio.

99designs

99designs is the #1 marketplace for crowdsourced graphic design. We connect passionate designers from around the globe with customers seeking quality, affordable design services.

99designs was started by designers for designers. Our role is to provide a friendly, professional and secure environment where designers from all walks of life can find opportunity and compete on a level playing field - where they can show off their work, improve their skills, communicate with peers and win new clients.

"99designs - thousands of designers compete for clients who need logos, websites or anything else designed for their small business."

Start-up developing smart pill bottle targets HIV, cancer, transplant meds & speciality pharmacies

 

Start-ups like Abiogenix are developing smart pill boxes that remind patients to take pills and knows when they have missed them. They alert the patient with an email or text message, nudging them to take the missed medication. Then there are later stage ventures likeVitality that make the GlowCaps, a pill bottle that glows green and beeps when a patient has missed a dosage.

A very early stage New York start-up is taking this idea further.

AdhereTech, is trying to develop a smart pill bottle that not only is intelligent enough to know when pills are missed, but also when liquid medication is missed. The data collected from the bottle is sent to a secure cloud server that is HIPAA compliant. The company can call or text to remind the patient to take the medication.

AdhereTech graduated from New York health accelerator Blueprint Health’ssummer program, and founder and CEO Josh Stein says his company is the only hardware company that has been admitted to the accelerator – that’s one out of 18 who have so far gone through Blueprint’s program.

Founded in October 2011, AdhereTech’s goal is to solve the costly conundrum of patient nonadherence. By some estimates, the true cost of patients not taking their pills is a jaw-dropping $188 billion. Stein, who incorporated the company after he graduated from the Wharton School of Business last year, said that the company expects to raise a $750,000 seed round from angel groups soon; $150,000 has already been raised.

A portion of the money will be used to finalize the product, expected to be completely in the first quarter before the launch of clinical trials, that will consume most of the seed round.

“We are running clinical trials that will compare our bottle to a generic bottle to see how much we can improve adherence,” Stein said.

For now AdhereTech is focusing on three drug markets – HIV, cancer and transplant drugs that are “expensive drugs distributed through specialty pharmacies.”

Stein believes that what sets his company apart from other companies is that he is trying to effect behavior change without actually making patients do anything differently when using their product.

“Under the umbrella of changing as little behavior as possible when it comes to using our product, the default reminder will be a phone call because we want to reach everyone and not only those with a cell phone,” Stein said. “But then they can opt to get reminders through text.”

So how will the process work? When patients go to a specialty pharmacy, they sign a HIPAA compliant consent form and can opt-in to the AdhereTech service. That gives the company access to the same information that is on the outside of a regular prescription bottle – name, contact information and dosage schedule, Stein explained.

“The AdhereTech bottle [then] sends periodic measurements of the contents of the bottle to our servers and because we have access to a patient’s dosage schedule and we know what drug they are on, we can determine that ‘Oh, because there is this much left in bottle, that means that this person is or is not adhering.’” he said.

Stein is talking with pharma companies who are receptive but all are looking for results of how the finished product works in the clinical trials.

Aside from Abiogenix and Vitality that all have the same goal of improving adherence, AdhereTech has another formidable competitor in Proteus Digital Health. That digital health company backed by names like Medtronic and Novartis, makes the FDA-cleared smart pill. It is an ingestible sensor that can be embedded in a pill and swallowed that transmits a signal to a wireless wearable patch that records the time the pill was taken.

 

Unpakt Is A Kayak-Style Marketplace For Moving Companies, And Now It’s Launching In 15 Cities

With Unpakt, moving out of your house or apartment doesn’t have to be a nightmare. Unpakt lets you compare reputable moving companies, compare prices, and book online. Now it’s launching in 15 cities and listing 100 movers after starting in New York. It’s like Kayak plus Yelp for movers. Unpakt could earn juicy referral fees, bring transparency to an industry laden with hidden rates, and make moving as easy as booking a flight.

Traditionally, finding a good price for getting all your possessions moved from one dwelling to the next was annoying and time consuming. You would look up companies, and call them one at a time. You’d have to repeat your addresses, preferred dates, how much stuff you have, and then get a quote that wasn’t even guaranteed to be what you’d pay. With this frustration and the inherent stress of moving, most people would end up just picking one of the first companies they called and overpaying.

Screw that. Most everyone moves a few times in their life, and prices can range from a few hundred to a few thousand dollars. It’s a big market desperately in need of a marketplace. That’s where Unpakt comes in.

Unpakt’s website lets you choose the size of your place, and select what furniture you have or instantly go with the typical trappings. You can save your progress at any time so you never have to punch in your data twice. Then you’re shown prices for your move from a bunch of local companies, and you can compare reviews so you know they’re not gonna break everything. Pick the best company with the lowest price and you pay right there on Unpakt.

I just tried out the booking process and it took all of two minutes to plan a move. Without professional packing and unpacking, hauling all the stuff in a well furnished one-bedroom apartment across San Francisco cost around $550. Thanks to Unpakt, though, I could find a great mover for $100 less than that and avoid companies trying to rip me off for over $800.

Unpakt opened up its beta in New York City in July, but now it’s launching in 15 additional markets coast to coast: Los Angeles, San Francisco, DC, Boston, Dallas, Houston, Austin, Miami, Tampa, Atlanta, San Diego, Denver, Raleigh, New Jersey, and Connecticut. It’s got nearly 100 movers listing their rates in the marketplace now, meaning you can do serious price shopping.

That’s a big deal for anyone who has to move because most companies don’t publish their rate cards and there didn’t used to be any way to efficiently compare them. That meant moving was like booking airfare before the Internet existed — having to call each company individually and never being sure you were getting the best price. That lack of transparency and friction in the comparison process made it easy for movers to jack up their rates if they thought they were talking to a sucker.

Thanks to Unpakt, not only are all the prices laid out, but movers are incentivized to have the lowest. Unpakt’s director of marketing, Jenna Weinerman, tells me “the movers using Unpakt competitively are getting the most jobs.” She says “our goal is to shine up the industry.” The 15-person startup is bootstrapped, but I bet VCs are going be clamoring to get in on Unpakt considering Kayak’s recent $1.8 billion exit.

The startup’s biggest challenge will be making sure the prices that movers list on Unpakt are actually the lowest they offer. Otherwise people may worry they have to call in, too, to double check their rate. That’s why Unpakt is improving and teaching movers to use its price input tool, and regularly monitors and audits prices to make sure those it lists aren’t higher than if you call in.

In exchange for the small referral fee percentage, Unpakt is doing marketing, sales, SEO, PR, and reducing staffing costs for movers. “Over time as movers grow with Unpakt, there’s a chance they can pass the savings on to the customers,” Weinerman says.

And even if they don’t, just saving you time on the phone and steering you away from needlessly expensive movers could be enough to get you recommending Unpakt to your friends. Otherwise, you might end up spending next Saturday breaking your back dragging their stupid couch down the stairs.

Unpakt isn’t just for individuals. Here’s the story of how one startup used Unpakt to move into their new office. It’s a bit idealized, but the video gives you a feel for how Unpakt can keep you from pulling out your hair.

Top 5 Health Trends to Watch in 2013

The growth of food waste consciousness, mini-meals, gluten-free products and mainstream veganism top the health trends expected to make headlines in 2013, according to a second annual forecast by a leading national research group studying health-related attitudes and behavior in America.

The Values Institute at DGWB, a social science research entity based in Santa Ana, Calif., used observational studies to identify the top health and wellness trends that Americans are most likely to embrace in 2013. A collaboration with DGWB's BalancedHealthy practice, serving clients in the health and wellness space, the annual list is an extension of the Institute's work in values-based marketing and social entrepreneurialism and long-term partnership with the international research firm Iconoculture of Minneapolis.

The top five consumer health trends for 2013 will be:

1. Food Waste Consciousness. Waste not, want not, especially in the kitchen. A recent Eco Pulse survey found that 39 percent of Americans feel guilty about trashing food, more so than any other "green" sin. Some waste is unavoidable, though, and communities and corporations alike are converting compostable scraps into disposable cash. Marin County, Calif., has begun processing wasted food from local groceries and restaurants to generate electricity, and Starbucks has found a way to recycle coffee grounds and baked goods into laundry detergent. Meanwhile, new mobile apps like Love Food Hate Waste help consumers plan meals from leftovers and manage portion size.

2. Wellness in the Workplace. Employers are realizing that working health into the corporate agenda benefits waistlines and bottom lines. With healthcare costs expected to rise by 7 percent, companies are improving employees' health (and minimizing healthcare expenditures) by adding wellness programs. Plan on seeing more discounted gym memberships, group Weight Watchers accountability plans, and active design workspaces this year. The National Business Group on Health found that 48 percent of companies surveyed plan to use incentives to get workers involved in wellness in 2013.

3. Mini-meals and Snacking. As the snacking trend continues, new research shows that those who eat between meals tend to have healthier diets.
FastCasual.com reports that snacks make up one out of every five eating occasions in the U.S. Especially prevalent is the advent of multiple "mini-meals" in place of the standard three squares a day. Quick Lean Cuisine salad options, probiotic nuts, and the ubiquitous cup of frozen yogurt with fruit are slowly replacing breakfast, lunch and dinner. Expect to see this trend continue and usher in a new standard for convenient, healthy snack foods beyond the 100-calorie Oreo pack.

4. Meatless Mainstreaming: Veganism is okay. Last year's rise of the flexitarians is foreshadowing a trend toward meatless eating and outright veganism, vegetarianism's older brother. No longer reserved for the hip in Hollywood, going vegan is being embraced as a viable health alternative. Even professional athletes like Venus Williams and Arian Foster, whose bodies are their livelihood, have made the switch. Merit-badge consumers seeking exotic natural ingredients like jackfruit and quinoa have helped turn the tide, especially as increasingly popular Asian and Indian flavor profiles eschew animal products. Look for herbivore-accommodating menus at restaurants on both coasts to start migrating to mid-America in 2013.

5. Going Against the Grain. The past year saw an influx of gluten-free products as everyone and their brother is shunning their Wheaties. Gluten has joined carbohydrates and corn syrup as the newest ingredient Americans love to leave out. While some experts see this as self-diagnosis gone awry, consumers increasingly see the "GF" logo as a guide to healthier eating. From grocery stores to gastro-pubs to brands like Betty Crocker to Domino's, the food industry is taking advantage of this new, not-so-niche need.

"Our 2013 findings are consistent with the growing importance of health in America — if not yet as a daily routine then certainly as a primary goal for three out of four consumers," said Mike Weisman, president of the Values Institute at DGWB. "More than ever, health is the new prestige barometer — meaning that most Americans would rather be called healthy than wealthy.

The Values Institute at DGWB is a division of Santa Ana-based DGWB Advertising & Communications. The agency's Balanced Healthy practice teamed up with Iconoculture in early 2011 to study the behavior of the 76 percent of Americans who actively take steps to maintain or improve their health. A total of 2,800 adults ages 18 and above participated in the national online study rating personal values and health actions. This undertaking led to the creation by DGWB and Iconoculture of six new healthy consumer segments that are based on shared values rather than traditional usage and demographics.

"By looking at shared values instead of the more traditional metrics, we're able to connect people at a deeper level on the basis of their common emotional and philosophical beliefs about health and wellness," said Mark Weinfeld, director of The Values Institute. "The study gives us a unique vantage point to accurately identify, follow and predict consumer trends

Amazon, Apple, and the beauty of low margins

[As always, I preface any discussion of Amazon and Apple by noting that I own some stock in both companies, and that I worked at Amazon from 1997 to 2004]
A lot of folks, especially Apple supporters, like to characterize Amazon as irrational, even crazy, for its willingness to live with low margins. It must be frustrating to compete with a company like that. But to call their strategy irrational or to believe they want to be a non-profit is a dangerous misreading of what they're all about.
It's been years since I worked there, so this is largely speculation on my part, but I believe Amazon is anything but irrational when it comes to how they think about margins. I believe it's a calculated strategy on their part, and anyone competing with them had best understand it.
As with people, I think companies can be more comfortable playing certain styles, much like certain players are more suited for a particular style of offense, like Mike D'Antoni's in the NBA or Chip Kelly's in football. Amazon's low margin strategy is one they are comfortable with because it sprung from the company's very origin. Amazon began in the bookselling business, and some of its earliest and most crucial advantages against incumbents like Barnes and Noble were best expressed with thinner margins.
One of online retail's main advantage was, of course, being able to forego expensive physical storefronts. With one and then two distribution centers total in the early years, Amazon essentially just had two "storefronts" to stock with book SKU's, whereas Barnes and Noble had to guess how to allocate SKU's across hundreds of stores all over the country, all necessitating long leases. A few Amazon editors could recommend books to all Amazon customers, whereas Barnes and Noble had to staff each of their individual stores with sales clerks.
More importantly, Amazon's inventory flow was drastically more efficient than that of Barnes and Noble. Amazon didn't have to carry inventory on really slow-selling SKU's, they could wait until a customer had ordered it and then drop-ship it from the distributor. If Amazon wanted to ship one of those SKU's themselves, customers generally had the patience to wait longer for them since those slow-turning SKU's didn't earn shelf space at the local Barnes and Noble anyway.
Almost all customers paid by credit card, so Amazon would receive payment in a day. But they didn't pay the average distributor or publisher for 90 days for books they purchased. This gave Amazon a magical financial quality called a negative operating cycle. With every book sale, Amazon got cash it could hang on to for up weeks on end (in practice it wasn't actually 89 days of float since Amazon did purchase some high velocity selling books ahead of time). The more Amazon grew, the more cash it banked. Amazon was turning its inventory 30, 40 times a year, whereas companies like Barnes and Noble were sweating to turn their inventory twice a year. Most people just look at a company's margins and judge the quality of the business model based on that, but the cash flow characteristics of the business can make one company a far more valuable company than another with the exact same operating margin. Amazon could have had a margin of zero and still made money.
At Amazon we were ruthlessly focused on squeezing efficiency out of every part of the business, especially the variable ones that affected every purchase. How could we get a book from the shelf into the hands of the customer more cheaply? How could we reduce the number of customer contacts per order for our customer service team? Could we offload some human customer service contact to cheaper online self-service methods while improving customer satisfaction? How could we negotiate steeper discounts on the books themselves? For each book SKU, was it more economical to purchase ahead of sales in bulk for steeper discounts and faster shipping or to purchase only when a customer placed an order and risk a longer delay in shipping? How could we allocate inventory among our distribution centers to increase the likelihood that all items in an order shipped from the same distribution center, minimizing our shipping costs? How could we organize all the Amazon shipments ready for delivery in a way that made lives easier on our shipping partners like the USPS and UPS, and then how could we use that to negotiate cheaper shipping rates? Did we need so many human editors reviewing books, or were customer reviews sufficient?
The type of operational efficiency Amazon rose to in those days is not something another company can duplicate overnight. It came on top of the inherent cost advantages of online commerce over physical commerce. So much of Amazon's competitive advantage in those days came from operational efficiency. You can choose to leverage that strength in two ways. One is you match your competitor on pricing and just earn higher margins. But the other, the way Amazon has always tended to favor, is to lower prices, to thin the oxygen for your competitors.
If you have bigger lungs than your competitor, all things being equal, force them to compete in a contest where oxygen is the crucial limiter. If your opponent can't swim, you make them compete in water. If they dislike the cold, set the contest in the winter, on a tundra. You can romanticize all of this by quoting Sun Tzu, but it's just common sense.
I worked on the launch of the Amazon Video store, Amazon's third product after books and music. At the time of the launch, DVDs had just launched as a product category a short while earlier, so the store carried both VHS tapes and DVDs. The day Amazon launched its video store, the top DVD store on the web at the time, I think it was DVD Empire, lowered its prices across the board, raising its average discount from 30% off to 50% off DVDs.
This forced our hand immediately. Selling DVDs at 50% off would mean selling those titles at a loss. We had planned to match their 30% discount, and now we were being out-priced by the market leader on our first day of operation, and just before the heart of the holiday sales season to boot (it was November, 1998).
We convened a quick emergency huddle, but it didn't take long to come to a decision. We'd match the 50% off. We had to. Our leading opponent had challenged us to a game of who can hold your breath longer. We were confident in our lung capacity. They only sold DVDs whereas we had the security of a giant books and music business buttressing our revenues.
After a few weeks, DVD Empire blinked. They had to. Sometime later, I can't remember how long it was, DVD Empire rebranded, tried expanding to sell adult DVDs, then went out of business. There were other DVD-only retailers online at the time, but none from that period survived. I doubt any online retailer selling only DVDs still exists.
Attacking the market with a low margin strategy has other benefits, though, ones often overlooked or undervalued. For one thing, it strongly deters others from entering your market. Study disruption in most businesses and it almost always comes from the low end. Some competitor grabs a foothold on the bottom rung of the ladder and pulls itself upstream. But if you're already sitting on that lowest rung as the incumbent, it's tough for a disruptor to cling to anything to gain traction.
An incumbent with high margins, especially in technology, is like a deer that wears a bullseye on its flank. Assuming a company doesn't have a monopoly, its high margin structure screams for a competitor to come in and compete on price, if nothing else, and it also hints at potential complacency. If the company is public, how willing will they be to lower their own margins and take a beating on their public valuation?
Because technology, both hardware and software, tends to operate on an annual update cycle, every year you have to worry about a competitor leapfrogging you in that cycle. One mistake and you can see a huge shift in customers to a competitor.
Not having to sweat a constant onslaught of new competitors is really underrated. You can allocate your best employees to explore new lines of business, you can count on a consistent flow of cash from your more mature product or service lines, and you can focus your management team on offense. In contrast, most technology companies live in constant fear that they'll be disrupted with every product or service refresh. The slightest misstep can turn a stock market darling into a company struggling for its very existence.
Amazon's core retail business is, I'd argue, still very secure. I can't think of a tech retail competitor that is a legitimate threat to Amazon in selling most physical goods. Where Amazon is most vulnerable in retail is those areas where the game shifted on them, and that's in the media lines where physical books, CDs, and DVDs are being digitized. Since no physical product must be transported through a distribution system, Amazon's operational efficiency advantages there are less effective against competition. But in the arena of buying something online and having a box delivered to your doorstep, who really scares Amazon?
Another advantage to low margin models is increased customer loyalty. Most of the products Amazon sells are commodity items. It's not like buying one brand of car versus another, where you a variety of subjective judgements affect the consumer's choice. The Avengers Blu-ray disc you buy from Amazon is the same one you'll find at Wal-Mart or Best Buy. In that world, the lowest price tends to win. In the early years, Amazon routinely lowered either product pricing or shipping pricing. Very few companies lower their prices permanently as time goes by except on depreciating goods, like computers whose value decreases as newer, faster models hit the market.
If you're the low-cost leader, customers will forgive a lot of sins. That margin of error, like the competitive moat, buys you peace of mind. I could spend time price-shopping every item on Amazon, but these days, I don't really bother. Amazon's website design is not going to win any design awards, it's a bit of a Frankensteinian assemblage thanks to distributed design decisions, but it's fast, the shipping is cheap or free, the customer service is fantastic, and oh, did I mention, their prices are great! There is value in being the site of first and last resort for customers.
If you want to jump into competition with Amazon, you can't just match Amazon, you have to leapfrog them. But they've left almost no price umbrella for you to sneak under, so you have to both match them in price and then blow them away on the user experience side to even get customers to think about switching. Who has the capital and wherewithal to play that exceedingly unpleasant, unprofitable game? You can only win that game at scale, and Amazon already achieved it.
Smart companies compete first by playing to their strengths, but Amazon also cleaves to a low margin strategy, I believe, because it's demonstrated the advantages noted above. Amazon could try to build a high margin tablet to compete with Apple, but why would they? How have companies that have tried to challenge Apple with design and build quality fared these past few years? Why would you try to challenge Apple in the areas it is strongest at?
In a recent interview, Reed Hastings claimed Amazon was spending $1 billion a year on licensing streaming video for Amazon Instant Video. Hastings is negotiating for much of the same content, I know he knows what that content costs, and since I used to work at Hulu, I can vouch for how easy it would be to burn through a billion dollars building up a substantial streaming video library. I do think Amazon may have overpaid as a consequence of wanting to come in strong and make a big play without as much pricing information as Netflix and Hulu have accumulated over the years, but it strikes me as a classic tactic out of the Amazon low end disruption playbook.
[In this world of digital video, this strategy is much more difficult to execute because there is no fixed price on licensing episodes of TV shows and libraries of movies. The information asymmetry works in favor of the content providers. Netflix had a great advantage when First Sale Doctrine permitted them to buy DVDs at the same wholesale price as any retailer since it capped their costs. But in the TV/movie licensing world, the content owner can constantly adjust their price to squeeze almost every last drop of margin from the distributor as you can't find perfect substitutes for the goods being offered. Ask TV networks if they make any money licensing NFL, NBA, and MLB games for broadcast. Hint: the answer is no. Ask companies like Apple and Spotify if they're making healthy margins selling digital music. Ask Netflix or Amazon if licensing TV shows and movies for digital streaming is more or less profitable than the days of selling or renting physical media. In the digital world, transfer pricing can be even more of a cruel mistress.
Most companies building profitable ecosystems in the digital world are making their profits elsewhere using the digital media as a loss leader. Apple on its hardware, for example, or TV networks trying to use sports contests to cross-promote their other TV programs.]
Apple took some grief last quarter for seeing some margin depression, but in and of itself, I don't see that as a bad sign. In fact, I was disappointed that Apple didn't price the iPad Mini lower out of the gate. Of course, they're largely sold out through the holidays, so pricing it lower means leaving money on the table in the conventional microeconomic analysis.
But in the long run, if you look at every iPad purchaser as a new subscriber to the Apple ecosystem of hardware and software services, there's value in fighting for every additional user versus Google or Amazon in the low end tablet market. Most customers who buy a low end tablet will stay in that producer's ecosystem for a while, at least a year. Graph the low end market and you see it trending towards zero, to that day when an Amazon or a Google will likely offer you a low end tablet for free, perhaps as part of your Amazon Prime subscription or if you agree to pay for Google Drive.
That's a world in which the switching costs are set by the software ecosystem of each of those companies, not the hardware. It's why Apple lovers are right to fret about iCloud and its underwhelming mail, storage, and calendaring services and substandard reliability, why Amazon might spend a billion dollars licensing videos, why Google tried so hard to switch people over to Google+. They're all looking for a path to software lockin, a more defensible moat.
Apple still is the margin king among those competitors in the mobile phone and tablet spaces in which they compete. But if they decided to start using their low-end priced SKU's in mobile phones and tablets to press down on Google and Amazon, and if their margins declined as a result, I, as a shareholder, wouldn't necessarily find that to be a negative. I would love to find the sales mix data on their different SKU's in the iPhone and iPad verticals, though I have yet to see that data shared publicly anywhere. The shape of that curve will tell us a lot about where those markets are in their lifecycle, but Apple has some control over their shape as well.
Some might say that Apple doesn't have the right mindset to play low-margin offense, that it's against their nature. But they've effectively dominated and wrung every last drop of money from the iPod market using pieces of this strategy, and they have the operational expertise and vertical integration to achieve it. In fact, Apple now turns its inventory more times a year than Amazon, by a healthy margin, a staggering fact.
I haven't mentioned Google much, but like Amazon they will continue to attack Apple at the low end with their strategy of subsidizing businesses with their core ad revenue. For the forseeable future, Apple will have these two giants snatching at their feet. It's a high pressure, high stakes game. Wouldn't it be nice to trade some margin for higher castle walls, just for peace of mind?
Most people don't appreciate them, but low margins have their own particular brand of beauty.