I came across this excellent article on 10 worst things than can happen during the online checkout process. It inspired me to add to the list:
1. An "over-persistent" cookie: If a consumer added something to their cart in the last visit and came back later to buy other items, allow the consumer the option to delete the items without jumping through hoops and don’t be a nag and try to push the item.
2. If an item is available in multiple colors/sizes, offer the option to change color/size of order in the shopping cart itself. Or, at least make it easy to go back and change the order. Like the article says, don’t trap customers in the checkout and force them to open a new tab to go back to the shopping page.
3. Make it easy to identify the “Ship to” address and make the customer confirm the address before confirming the order. This will save both the customer and the vendor hassle, time and money.
4. Offer options for partial payment: the customer may have a gift card or store credit that they want to use, and may only want to pay the balance with a credit card. Many sites offer the option but don’t explain that they do this. If you do something customer-friendly, advertise it!
5. If an item is out of stock, offer to notify the customer when fresh stock arrives. It’s easy to do, costs the vendor very little and is an excellent marketing opportunity to bring a customer back to your site where they might end up ordering other things while they’re there.
6. If you have a brick and mortar store in addition to an online store, emphasize it. This is a great feature to emphasize particularly if returns can be dropped off at the store and don’t have to be mailed back, or if customer can get free shipping if (s)he offers to pick-up in store. In-store pick-ups/returns maximize the opportunity for impulse buys.
Tuesday, September 28, 2010
Tuesday, August 24, 2010
Thoughts on pricing
I recently had to fly into Oakland airport and needed to get to the South Bay as soon as possible after I landed. As I started exploring my transportation options, I was reminded of a service I signed up for recently called "TaskRabbit". I logged on to TaskRabbit and happily enough, one of the errands I was allowed to request was a ride from one place to another. I therefore decided to put out a request for a ride, mentioned that I need to get to the South Bay ASAP, and requested errand runners to bid on my task.
The responses I got left me puzzled. I got quotes ranging from $65 to $90 for a one way ride of about 45 miles. A taxi ride would have cost me $60. If I had picked up a rental car (one way), I got a quote of $50 and if I were willing to make a round trip to return the rental car, the cost of my transport was approximately $30. This made me think as to how the errand runners might have priced their services. It seems they each based it on their costs (time + gas + mileage).
It occurred to me that they perhaps missed a fundamental point about pricing - they were actively competing against other transportation alternatives available to me, in order to earn my business. While I was willing to pay a small premium for the convenience of having someone wait for me as I walked out the door and not having to pick-up/return a rental car, I was not willing to pay a 100% premium. Instead of pricing competitively from the customer's perspective, they priced it based upon their costs.
This seemed like a great example to share with my blog readers about how to think about pricing, and the importance of examining business decisions from the shoes of customers!
The responses I got left me puzzled. I got quotes ranging from $65 to $90 for a one way ride of about 45 miles. A taxi ride would have cost me $60. If I had picked up a rental car (one way), I got a quote of $50 and if I were willing to make a round trip to return the rental car, the cost of my transport was approximately $30. This made me think as to how the errand runners might have priced their services. It seems they each based it on their costs (time + gas + mileage).
It occurred to me that they perhaps missed a fundamental point about pricing - they were actively competing against other transportation alternatives available to me, in order to earn my business. While I was willing to pay a small premium for the convenience of having someone wait for me as I walked out the door and not having to pick-up/return a rental car, I was not willing to pay a 100% premium. Instead of pricing competitively from the customer's perspective, they priced it based upon their costs.
This seemed like a great example to share with my blog readers about how to think about pricing, and the importance of examining business decisions from the shoes of customers!
Friday, July 9, 2010
5 critical skills entrepreneurs need
Venturebeat has an excellent article today on 5 critical skills entrepreneurs need. The speaker is serial entrepreneur Jerry Kaplan.
Jerry Kaplan highlights these as the 5 critical skills:
1. Leadership: the ability to get everyone to move in the same direction even when they disagree
2. Communication: the ability to get everyone on the same page
3. Decision making: knowing when to make a decision - neither prematurely nor too late
4. Team player: know when to delegate and,
5. Telescope: the ability to zoom in and focus on details and zoom out and focus on the big picture as needed.
Well worth watching the ~9 minute video.
Jerry Kaplan highlights these as the 5 critical skills:
1. Leadership: the ability to get everyone to move in the same direction even when they disagree
2. Communication: the ability to get everyone on the same page
3. Decision making: knowing when to make a decision - neither prematurely nor too late
4. Team player: know when to delegate and,
5. Telescope: the ability to zoom in and focus on details and zoom out and focus on the big picture as needed.
Well worth watching the ~9 minute video.
Wednesday, July 7, 2010
E-mail newsletters: the new trend
I came across this post on GigaOm today that speculates it’s time to stop blogging and start an email newsletter instead. It seems to be the hot thing these days with people like Sam Lessin (the founder of drop.io) opting for paid email newsletters. I am happy to report I remain committed to blogging and disagree with the whole paid newsletter thing (and no, it has nothing to do with the fact that I am not a celebrity with a fan following willing to pay for nuggets of my wisdom :)
To my mind, knowledge is not meant to be hoarded, it’s meant to be given freely. If/whether the recipient benefits is up to the recipient. To say that someone will share their best tips with you only if you pay $2 per month and sign up for their email newsletter seems somewhat disingenuous. It’s like charging someone to make an introduction - both parties know money was involved and that can potentially diminish the relationship. Seeing as how this knowledge is most likely not proprietary and was gleaned through interaction with others (either as received wisdom or experience), I question the fairness of charging for this knowledge.
E-mail newsletters seem like a step backward in some ways.
1. One of the huge benefits of social media is its inherent viral nature. Paid e-mail newsletters are big dampers of viral loops.
2. RSS feeds are a blessing for anyone trying to keep up with the information overload. To regress and increase the email volume in already overloaded inboxes is a big step backward in my opinion.
3. How many paid newsletters is the average person going to subscribe to? Even if each of these newsletters is priced $2 or less, it very quickly multiplies if a single person only follows 25 RSS feeds which convert to paid newsletters.
4. Then there’s the matter of how these people are going to get paid - I worry about credit card security and theft, and would be very uncomfortable having so many people bill me small amounts every month (increases the probability I won’t detect fraudulent entries), even if I am willing to share my credit card/Paypal information with so many third parties!
If this is the trend, I smell a new entrepreneurial opportunity. I want to build myself an email newsletter aggregator software that will take care of aggregating all those emails in one place and parse the data per my preferences, plus will take care of the billing so that I only need to share my financial information with one company. Interested in co-founding, anyone? :)
To my mind, knowledge is not meant to be hoarded, it’s meant to be given freely. If/whether the recipient benefits is up to the recipient. To say that someone will share their best tips with you only if you pay $2 per month and sign up for their email newsletter seems somewhat disingenuous. It’s like charging someone to make an introduction - both parties know money was involved and that can potentially diminish the relationship. Seeing as how this knowledge is most likely not proprietary and was gleaned through interaction with others (either as received wisdom or experience), I question the fairness of charging for this knowledge.
E-mail newsletters seem like a step backward in some ways.
1. One of the huge benefits of social media is its inherent viral nature. Paid e-mail newsletters are big dampers of viral loops.
2. RSS feeds are a blessing for anyone trying to keep up with the information overload. To regress and increase the email volume in already overloaded inboxes is a big step backward in my opinion.
3. How many paid newsletters is the average person going to subscribe to? Even if each of these newsletters is priced $2 or less, it very quickly multiplies if a single person only follows 25 RSS feeds which convert to paid newsletters.
4. Then there’s the matter of how these people are going to get paid - I worry about credit card security and theft, and would be very uncomfortable having so many people bill me small amounts every month (increases the probability I won’t detect fraudulent entries), even if I am willing to share my credit card/Paypal information with so many third parties!
If this is the trend, I smell a new entrepreneurial opportunity. I want to build myself an email newsletter aggregator software that will take care of aggregating all those emails in one place and parse the data per my preferences, plus will take care of the billing so that I only need to share my financial information with one company. Interested in co-founding, anyone? :)
Thursday, July 1, 2010
Why ARE Asians better at Math?
This is a little different from my usual posts about entrepreneurship, but given the strong positive correlation between education levels and being a successful entrepreneur in technology, I figured it’s worth the digression.
I am currently reading Malcolm Gladwell’s “Outliers” and just finished reading the chapter on why Asians are better at math. I was initially very excited to read it but upon further reflection am wondering if his theory is really true. Gladwell attributes the success of Asians in math to three major factors:
(1) He draws a parallel between the work ethic instilled by working long hours in rice fields which fostered a culture of hard work and the work ethic in today’s generation of Asians who continue to be similarly hard working.
(2) Apparently, the human mind can remember and process 2 seconds worth of numerical data points. Unlike English, Asian languages use monosyllables to describe numbers. Therefore, where the person who knows the numbers in English can typically remember 4 digits, the average Cantonese speaker can remember 10 digits.
(3) The numbering in Asian languages is logical and intuitive compared to English. For instance, in English we count eleven, twelve etc. not the logical one-teen, two-teen, three-teen etc. Whereas in Asian languages (including my own mother tongue of Tamizh), it is counted off as ten and one, ten and two, ten and three etc. Similarly, in Chinese, the fractions are literally written out as one part of four, three parts of four etc making the concept intuitively easier to grasp.
Gladwell argues that the logical numbering makes it a lot easier for young children to grasp fundamental concepts like addition where they can skip the step of translating say “eleven” into a number before they can add it, learn fractions easily because of how they are framed in their mother tongue. This in turn means they enjoy math more, do their homework with less resistance and therefore begin a virtuous cycle.
Sounds good in theory, but...
(1) I count in English. I understand numbers up to 1000 fluently in 3 different languages but always translate any other language to English in my head before I can perform any mathematical operations. For the purposes of the American census, I am Asian and I suppose as an engineer who started learning calculus in ninth grade and can do math in her head, I live up to the Asians-are-good-at-math stereotype. Several of my friends of my generation and background fit this same mold, so I am not trying to draw a generalized conclusion based upon a data set of one nor am I exceptional in any way.
(2) I know several people whose families are of Jewish origin, who have worked incredibly hard over many generations. Hard work is no stranger to their cultural fabric or the present generation, who recognize that what they enjoy today would not have been possible without the hard work of their ancestors. It seems a stretch to say that only the rice farmers of Asia know the true meaning of hard work and have therefore integrated it into their culture and passed it down to subsequent generations.
So:
If I can do the Math in English in my head just as fast as any other Asian who computes in his mother tongue, if there are other cultures that have worked equally hard to succeed and have hard work ingrained in their cultural fabric, I submit that it’s a matter of sufficient practice and hard work, which is not the exclusive domain of any one culture. To generalize it in that manner might be a disservice to the individual. This is where stereotypes come from and they’re not always a convenient thing to live up to.
What is your opinion on Gladwell’s theory?
I am currently reading Malcolm Gladwell’s “Outliers” and just finished reading the chapter on why Asians are better at math. I was initially very excited to read it but upon further reflection am wondering if his theory is really true. Gladwell attributes the success of Asians in math to three major factors:
(1) He draws a parallel between the work ethic instilled by working long hours in rice fields which fostered a culture of hard work and the work ethic in today’s generation of Asians who continue to be similarly hard working.
(2) Apparently, the human mind can remember and process 2 seconds worth of numerical data points. Unlike English, Asian languages use monosyllables to describe numbers. Therefore, where the person who knows the numbers in English can typically remember 4 digits, the average Cantonese speaker can remember 10 digits.
(3) The numbering in Asian languages is logical and intuitive compared to English. For instance, in English we count eleven, twelve etc. not the logical one-teen, two-teen, three-teen etc. Whereas in Asian languages (including my own mother tongue of Tamizh), it is counted off as ten and one, ten and two, ten and three etc. Similarly, in Chinese, the fractions are literally written out as one part of four, three parts of four etc making the concept intuitively easier to grasp.
Gladwell argues that the logical numbering makes it a lot easier for young children to grasp fundamental concepts like addition where they can skip the step of translating say “eleven” into a number before they can add it, learn fractions easily because of how they are framed in their mother tongue. This in turn means they enjoy math more, do their homework with less resistance and therefore begin a virtuous cycle.
Sounds good in theory, but...
(1) I count in English. I understand numbers up to 1000 fluently in 3 different languages but always translate any other language to English in my head before I can perform any mathematical operations. For the purposes of the American census, I am Asian and I suppose as an engineer who started learning calculus in ninth grade and can do math in her head, I live up to the Asians-are-good-at-math stereotype. Several of my friends of my generation and background fit this same mold, so I am not trying to draw a generalized conclusion based upon a data set of one nor am I exceptional in any way.
(2) I know several people whose families are of Jewish origin, who have worked incredibly hard over many generations. Hard work is no stranger to their cultural fabric or the present generation, who recognize that what they enjoy today would not have been possible without the hard work of their ancestors. It seems a stretch to say that only the rice farmers of Asia know the true meaning of hard work and have therefore integrated it into their culture and passed it down to subsequent generations.
So:
If I can do the Math in English in my head just as fast as any other Asian who computes in his mother tongue, if there are other cultures that have worked equally hard to succeed and have hard work ingrained in their cultural fabric, I submit that it’s a matter of sufficient practice and hard work, which is not the exclusive domain of any one culture. To generalize it in that manner might be a disservice to the individual. This is where stereotypes come from and they’re not always a convenient thing to live up to.
What is your opinion on Gladwell’s theory?
Monday, June 28, 2010
Back from a sabbatical!
I have been gone from my blog for nearly 3 months and during that time, much water has flown under the bridge. I earned my third degree and walked in one more commencement ceremony, travelled to 5 countries, 8 states and made some life decisions. Not bad for 3 months...
During the time, I have been blessed with the opportunity to see entrepreneurs in different walks of life, and expanded my vision of entrepreneurship considerably. I also came to the conclusion that my cup of tea is definitely innovation + technology and one without the other is not quite as exciting. So here are some random thoughts:
- Warning bells should sound when you’re initially recruited by people other than founders for early stage start-ups. They should sound even louder when only 1 of the founders speaks with you... either they’re not quite as interested in you as you think, or it’s an indication of internal challenges the company is working through.
- Acquisition of a start-up by a larger company inevitably results in indigestion. The question is how bad is the indigestion. It’s almost never a good idea to work for a recently acquired start-up within a big company. A lesson learned after many hours wasted doing the back-and-forth dance the past couple of months.
- Companies innovate yes, but make sure the kind of innovation is the kind you’re comfortable with! I have come across companies that innovate to lower cost (buying older machines and retooling them, innovating manufacturing techniques etc) and others that innovate and create bleeding edge products that will help them attract new customers and gain market share. I find I prefer the latter.
- Sometimes, life makes you choose between the proverbial devil and the deep sea. I came across this excellent article on how to make good decisions - some I had already learned through experience, others I was grateful to get a heads-up about. I am still puzzled though how one can apply foresight to distinguish between a big decision and a small decision. Sometimes, the things I have thought of as minor decisions have had huge implications and sometimes even changed my perception, and others that I spent hours mulling over ended up being moot points in the journey of life.
What are your thoughts on the decision making process and what lessons have you learned?
During the time, I have been blessed with the opportunity to see entrepreneurs in different walks of life, and expanded my vision of entrepreneurship considerably. I also came to the conclusion that my cup of tea is definitely innovation + technology and one without the other is not quite as exciting. So here are some random thoughts:
- Warning bells should sound when you’re initially recruited by people other than founders for early stage start-ups. They should sound even louder when only 1 of the founders speaks with you... either they’re not quite as interested in you as you think, or it’s an indication of internal challenges the company is working through.
- Acquisition of a start-up by a larger company inevitably results in indigestion. The question is how bad is the indigestion. It’s almost never a good idea to work for a recently acquired start-up within a big company. A lesson learned after many hours wasted doing the back-and-forth dance the past couple of months.
- Companies innovate yes, but make sure the kind of innovation is the kind you’re comfortable with! I have come across companies that innovate to lower cost (buying older machines and retooling them, innovating manufacturing techniques etc) and others that innovate and create bleeding edge products that will help them attract new customers and gain market share. I find I prefer the latter.
- Sometimes, life makes you choose between the proverbial devil and the deep sea. I came across this excellent article on how to make good decisions - some I had already learned through experience, others I was grateful to get a heads-up about. I am still puzzled though how one can apply foresight to distinguish between a big decision and a small decision. Sometimes, the things I have thought of as minor decisions have had huge implications and sometimes even changed my perception, and others that I spent hours mulling over ended up being moot points in the journey of life.
What are your thoughts on the decision making process and what lessons have you learned?
Monday, March 8, 2010
Desh Deshpande at MIT
Desh Deshpande is speaking to the Founder’s Journey class at MIT and I am blogging live. He is being interviewed by Prof. Tom Magnanti who was Dean of Engineering at MIT until 2007. He is one of 14 faculty members to carry the title "Institute Professor", the highest honor that MIT can offer. It was under Prof. Magnanti’s leadership as Dean that Desh Despande was inspired to create MIT's Deshpande Center for Technological Innovation. Many people, after being named Institute Professor and after retiring as Dean, would take a break and rest. Not Tom Magnanti. He has just taken on the task of creating a new university in Singapore, described in this press release:
http://www.moe.gov.sg/media/press/2009/10/professor-thomas-magnanti-name.php.
With two of the most respected people at MIT on the stage before me, we are in for an incredible evening densely packed with pearls of wisdom.
The conversation kicked off with “when do you know you should persevere, and when to give up?”. The class came up with lots of interesting suggestions, including “if it’s VC money, keep on spending, if it’s personal debt, quit!” :D
Desh’s advice on this topic was as follows:
- Distinguish between what you can control and what you cannot control
- Trust your gut
- Set milestones and timelines: when you don’t meet a milestone or the expected results aren’t there, read the writing on the wall and move on.
On the topic of tensions between entrepreneurs and VCs, Desh made the following points:
- It’s not possible to achieve a big vision purely through bootstrapping. VC money is necessary.
- If the entrepreneur hits every milestone as promised, VCs will respect the entrepreneur both for their ability to set realistic milestones as well as their ability to execute.
On how he got into entrepreneurship after a PhD:
Met Peter Brackett who was working on a start-up. Joined him at his invitation. The start-up was acquired by Motorola soon after. The business eventually grew to 100s of millions of dollars. If he could do this for Motorola, why not independently? Thus the seed of entrepreneurship was sowed.
Tom Magnanti is doing a fantastic job of guiding the conversation, and seems to be a natural at this. He’s asking all the questions that are on the top of the audience’s minds as we hear Desh speak.
On the topic of luck in entrepreneurial success:
- Analogy of kids playing soccer. The kids have fun kicking the ball around. Parents get upset because the kids are not kicking the ball a certain way. Entrepreneurship is like that. When you are having fun doing what you do and are passionate about it, you will play to have fun. How many goals you shoot is a bit dependent on luck. Chances of having a huge exit as an entrepreneur is like shooting a goal. If you are not playing for the fun of it, you are going to be very unhappy like the parents who are onlookers.
How to identify big ideas:
- Big ideas are the usually the result of a shift in the market. They are very simple ideas in hind sight.
- Pick a small simple idea that’s easy to bootstrap. The bootstrapping allows for much easier course correction. Once you build credibility by tackling the simple problems successfully, you will be better prepared to tackle the big problems.
On how to build the ideal team:
- Once you get a few good people, it snowballs
- Develop an eye for good people; learn to see each individual’s strengths
- Best people to hire are the people who have the potential but haven’t achieved the peak yet
- When you hire people, you never know whether they are going to work out or not. If you made a mistake, fire them quickly.
If you make a mistake, admitting to a mistake and correcting it as a very important trait.
Qualities of an entrepreneur:
- Naive
- Wildly optimistic
- Don’t get hung up on why the world is fair/unfair.
- The mentality that “I am giving up so much to play this game” - the sacrificing mentality, instead of “I love playing this game!” is fatal. An entrepreneur should do it for the opportunity and fun of doing it, instead of getting hung up on the outcome.
Parting advice:
Entrepreneurship is about taking the leap to jump in and solve a problem. Don’t get hung up on whether you’re rewarded for it or not. Judge the quality of an opportunity by assessing the ability to make a difference. Make a bigger difference in whatever you do. You will be the CEO of your life, your family, your career - cultivating this attitude will make a difference.
Prof. Magnanti just wrapped up the conversation by asking the audience to call out the key lessons they took away from the conversation. It’s clear that the audience recognizes the privilege they have been offered, and between the 75 odd people in the room, the lessons get cemented into memory and is capped off by thundering applause.
http://www.moe.gov.sg/media/press/2009/10/professor-thomas-magnanti-name.php.
With two of the most respected people at MIT on the stage before me, we are in for an incredible evening densely packed with pearls of wisdom.
The conversation kicked off with “when do you know you should persevere, and when to give up?”. The class came up with lots of interesting suggestions, including “if it’s VC money, keep on spending, if it’s personal debt, quit!” :D
Desh’s advice on this topic was as follows:
- Distinguish between what you can control and what you cannot control
- Trust your gut
- Set milestones and timelines: when you don’t meet a milestone or the expected results aren’t there, read the writing on the wall and move on.
On the topic of tensions between entrepreneurs and VCs, Desh made the following points:
- It’s not possible to achieve a big vision purely through bootstrapping. VC money is necessary.
- If the entrepreneur hits every milestone as promised, VCs will respect the entrepreneur both for their ability to set realistic milestones as well as their ability to execute.
On how he got into entrepreneurship after a PhD:
Met Peter Brackett who was working on a start-up. Joined him at his invitation. The start-up was acquired by Motorola soon after. The business eventually grew to 100s of millions of dollars. If he could do this for Motorola, why not independently? Thus the seed of entrepreneurship was sowed.
Tom Magnanti is doing a fantastic job of guiding the conversation, and seems to be a natural at this. He’s asking all the questions that are on the top of the audience’s minds as we hear Desh speak.
On the topic of luck in entrepreneurial success:
- Analogy of kids playing soccer. The kids have fun kicking the ball around. Parents get upset because the kids are not kicking the ball a certain way. Entrepreneurship is like that. When you are having fun doing what you do and are passionate about it, you will play to have fun. How many goals you shoot is a bit dependent on luck. Chances of having a huge exit as an entrepreneur is like shooting a goal. If you are not playing for the fun of it, you are going to be very unhappy like the parents who are onlookers.
How to identify big ideas:
- Big ideas are the usually the result of a shift in the market. They are very simple ideas in hind sight.
- Pick a small simple idea that’s easy to bootstrap. The bootstrapping allows for much easier course correction. Once you build credibility by tackling the simple problems successfully, you will be better prepared to tackle the big problems.
On how to build the ideal team:
- Once you get a few good people, it snowballs
- Develop an eye for good people; learn to see each individual’s strengths
- Best people to hire are the people who have the potential but haven’t achieved the peak yet
- When you hire people, you never know whether they are going to work out or not. If you made a mistake, fire them quickly.
If you make a mistake, admitting to a mistake and correcting it as a very important trait.
Qualities of an entrepreneur:
- Naive
- Wildly optimistic
- Don’t get hung up on why the world is fair/unfair.
- The mentality that “I am giving up so much to play this game” - the sacrificing mentality, instead of “I love playing this game!” is fatal. An entrepreneur should do it for the opportunity and fun of doing it, instead of getting hung up on the outcome.
Parting advice:
Entrepreneurship is about taking the leap to jump in and solve a problem. Don’t get hung up on whether you’re rewarded for it or not. Judge the quality of an opportunity by assessing the ability to make a difference. Make a bigger difference in whatever you do. You will be the CEO of your life, your family, your career - cultivating this attitude will make a difference.
Prof. Magnanti just wrapped up the conversation by asking the audience to call out the key lessons they took away from the conversation. It’s clear that the audience recognizes the privilege they have been offered, and between the 75 odd people in the room, the lessons get cemented into memory and is capped off by thundering applause.
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