b r e t t l i d e r

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Why Amazon is Not Enough

• Towards the future of eCommerce and the Web
• Brett Lider
• 07 March 2005

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Agenda

• Foundations of Future Web
• What is the Future Web?
• Broad overview of Future Webs composition
• Infrastructure
• Components
• A Future Web Architecture
• Deep-dive into one potential Web 2.0 application
  C2B
• Better Bookshelves a proposed C2B initiative
• IAs and Future Web a match made in heaven

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Why Amazon is not enough, part 1

• It doesnt really know you
• Has so many of the pieces, but not enough of the
  whole
• Siloed technical platform are what cause this
• Approaching the limits of traditional
  CRM/personalization
• How many eCommerce sites are in a similar
  position?

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Defining the Future Web 2.0

• From the golden source, Wikipedia
• Web 2.0 defines a newer incarnation of the World
  Wide Web typified by the transition from the
  typical website hosting HTML/XHTML pages, to a
  platform that provides a point of presence
  (sometimes known as a Web portal), from which any
  of the following interactions may occur
• Syndication of content using XML based formats
  such as RSS, RDF, Atom, and others
• Aggregation of content published using XML based
  formats such as RSS, RDF, Atom, and others
• Publishing of invocation endpoints for XML based
  Web services (these may be of the SOAP/WSDL/WS-
  variety of RESTian XML-RPC)
• Conventional publishing of HTML/XHTML documents
• Exposure of WebDAV based resources and collections

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Some Components of Web 2.0

• Social Networks (SN)
• Desktop information
• Browser history
• Tastes and preferences
• Analog information

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Practical use of Social Networks
A marriage of working your network and sending
a resume into the void
Its still a lot of work just for this
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Access to the desktop Blinkx
Retrieval people dont remember where they saw
it web or desktop?
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Access to the desktop Google
Search what can my desktop files do to help me
find what I need on the web?
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Access to the desktop Music
All about me and my music
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Access to the desktop Music Commerce
All about what Apple wants to sell me
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Tying desktop music data to the web
Tracking, community, recommendations
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Integrating browser history data
Remind me where I have been, what I have searched
on
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Web-based bookmarks
Universal bookmark access, sharing, community
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Web-based archiving
Killing link-rot dead
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Physical history data web and desktop
Who have I been hanging out with? What have I
been meeting about?
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Integrating non-digital information

• Delicious Library and other collection
  management tools help us curate our material
  goods

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Why Amazon is not enough, part 2

• Aside from A9, what is Amazon doing to bring
  these concepts to the eCommerce experience?

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A Vision of Web 2.0 for eCommerce

• C2B
• Customer-to-Business

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What is C2B?

• C2B is the empowerment of customers with their
  past purchase and preference data, allowing them
  to share it when and with who they desire
• C2B is the platform businesses can use to deliver
  products with more resonance and to target
  customers with more value than ever before
• C2B is superior to the promise and practice of
  CRM because it provides a more complete consumer
  perspective and deeper insight

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C2B Customer-to-Business
user

• One customer to many businesses
• Inverts the pyramid
• Allows information reuse, a key metric in getting
  people to contribute it
• B2C and traditional CRM are not good enough
  anymore
• A Customers interaction with Vendor X is a
  subset of that persons activities
• The superset is richer and its completeness is
  invaluable
• Vendor-Vendor coopitition for customer data is
  key to getting access to the superset
• (C2B a.k.a. CMI Customer-Managed Interactions)

data
customer
customer
data
online retailers
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Why is C2B important?

• Analysts describe the increasing demands from
  consumers that businesses must know them to earn
  their business
• Consumers will demand a more and more personal
  relationship over time
• Gartner and the usual suspects
• Micro-markets, narrow-casting, and one-to-one
  messaging are the marketing Holy Grail
• The Harvard Business Review just ran an article
  on C2B, hailing it as the heir to CRM
• They call it Customer-Managed Interactions - CMI

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Visualizing C2B a complete picture of a
customers purchases
Online retailer
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Visualizing C2B a complete picture of a
customers purchases
Other online retailers
Brick and mortar
Online retailer
Gifts
Library, school, Work, personal loan
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Visualizing C2B a complete picture of a
customers purchases
Other online retailers
Are you marketing based on this?
Brick and mortar
Online retailer
Gifts
Library, school, Work, personal loan
Or this?
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The Status Quo in Recommendation-Based
Merchandising Crappy
Online retailer
1. Online retailer purchases (and data)
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The Status Quo in Recommendation-Based
Merchandising Crappy
Online retailer
1. Online retailer purchases (and data)
2. Recommendation Merchandising (and quality)
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The Status Quo in Recommendation-Based
Merchandising Crappy
Online retailer
1. Online retailer purchases (and data)
2. Recommendation Merchandising (and quality)
3. Recommendation-based purchases
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The Status Quo in Recommendation-Based
Merchandising Crappy
Online retailer
1. Online retailer purchases (and data)
2. Recommendation Merchandising (and quality)
3. Recommendation-based purchases
Strength of relationship
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Recommendation-Based Merchandising the C2B Way
1. Online retailer purchases (and data)
1. Other online retailer purchases data
Online retailer
1. Gift data
1. Brick and mortar purchase data
1. Library, school, Work, personal loan data
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Recommendation-Based Merchandising the C2B Way
1. Online retailer purchases (and data)
1. Other online retailer purchases data
Online retailer
1. Gift data
1. Brick and mortar purchase data
1. Library, school, Work, personal loan data
2. Recommendation Merchandising (and quality)
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Recommendation-Based Merchandising the C2B Way
1. Online retailer purchases (and data)
1. Other online retailer purchases data
Online retailer
1. Gift data
1. Brick and mortar purchase data
1. Library, school, Work, personal loan data
2. Recommendation Merchandising (and quality)
3. Recommendation-based purchases
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Recommendation-Based Merchandising the C2B Way
1. Online retailer purchases (and data)
1. Other online retailer purchases data
Online retailer
1. Gift data
1. Brick and mortar purchase data
1. Library, school, Work, personal loan data
2. Recommendation Merchandising (and quality)
3. Recommendation-based purchases
Strength of relationship
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Future C2B Trusted 3rd Parties
Online retailers
My Network Stuff host (trusted 3rd party)
My Library (all media types)
My Preferences
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Future C2B Trusted 3rd Parties
Anonymizing filter (optional)
Online retailers
Recommendations
My Network Stuff host (trusted 3rd party)
My Library Preferences
User Profile
Aggregated Recommendations
Recommendations
User Profile
User Profile
Recommendations
My Library (all media types)
My Preferences
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Future C2B Trusted 3rd Parties
Anonymizing filter (optional)
Online retailers
Recommendations
My Network Stuff host (trusted 3rd party)
My Library Preferences
User Profile
Aggregated Recommendations
Recommendations
User Profile
Recommendation-Based Purchases
User Profile
Recommendations
My Library (all media types)
My Preferences
Recommendation-Based Purchases
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Example Amazon.com Better Bookshelves

• A proposal for improving CD, DVD, Game, and Book
  recommendations
• To evaluate the business case estimate the
  audience and the value
• 55 of families own a digital still camera
• Portion who are Amazon customers
• Portion who would be interested in the BB
  program
• Portion who would be able to complete the BB
  process
• Estimated incremental sales based on a richer
  user profile

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How the Better Bookshelves program works
1. Image uploaded to Amazon servers (or processed
client-side)
3. Image processed for individual book spines

• 4. Book spines OCRd (or image comparison
  performed) to get book titles
• THE MUSEUM AT PURGATORY
• THE BEAUTY SUPPLY DISTRICT
• McSWEENEYS QUARTERLY CONCERN ISSUE FIVE
• D(IROTHY PARKER Complete Stories

2. Image auto-rotated
4a. If OCR technology used, extracted book titles
compared to known list of book titles and best
matches generated
Next page
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How the Better Bookshelves program works (cont.)

• 5. Customer reviews suggested titles and approves
  them
• The Museum at Purgatory (Byzantium Book)
• Complete Stories
• Julius Knipl, Real Estate Photographer
• McSweeney's Issue No. 5 (McSweeney's Issue,
  Volume 5)

6. Titles added to Items you own page and
influence recommendations
7. Recommendations improve, driving more sales!
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More C2B examples Netflix vs. Walmart
Lowering switching costs
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More C2B examples Travel business vs. Travel
business

• Getting a better deal by showing a business my
  full profile
• Understanding the potential value of new
  customers
• One years reservation emails
• United
• Orbitz
• Travelocity
• Europcar
• Hertz
• Expedia

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C2B is coming

• It has a community of business academics around
  it
• People are actively thinking about C2B as a
  business
• It has clear advantages over monolithic CRM
  approaches to the same issue, but leverages CRM
  approaches
• It gets businesses out of data warehousing and
  focused on service and the relationship
• Risky, but competition will bring it about

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Why Amazon is not enough, part 3

• Amazon is not enough because it could be so much
  more
• The same goes for eCommerce and the Web

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Wrap-up

• Web 2.0 can make things like C2B possible
• Sites and businesses need to start thinking about
  the opportunities in this
• By being on top of this, IAs can be agents of
  some serious innovation
• Be it, dont dream it

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Contact

• Brett Lider
• blider_at_gmail.com
• Y! and AOL IM brettlider
• C2B Blog www.brettlider.com

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References

• A9, A9 Toolbar
• Amazon.com
• Apple iTunes Music Store
• Audioscrobbler
• Blinkx (desktop search)
• CMI/C2B mailing list
• Evite
• Gartner
• Google Desktop Search

• Harvard Business Review (direct article link)
• iTunes Music Recommendation System
• LinkedIn
• Netflix
• Slogger
• Walmart