1. The right problem
In order to be acquired you have to have something worth acquiring. The guys at Adometry weren’t just building their business for acquisition. They were building a great business and a solution to a tough problem that people are willing to pay big dollars for. Attribution is one of those big problems. Attribution, as it refers to marketing and advertising, is the ability to give credit to the advertising sources that helped convert your customers.
Most people give attribution to the last point of contact that brought a user to their website, but there’s so much more to it. How do you know which methods are effectively raising awareness about your product and bringing you more customers? Go to Adometry’s website if you want to learn more about that. I’m going to continue talking about what we can learn from this business.
Problems are not created equal. Being able to see where the money will be be in relation to a problem to be solved for a given market is a special skill set that founders and leaders need to work to develop. Adometry did not start out doing attribution. They pivoted into that space as they saw the opportunity emerging. Clayton Christensen does a great job laying down theories that help leaders identify where the profits are going to be in the value chain in his book The Innovators Solution.
Have you ever laid out the value chain surrounding your business? Where are you in the value chain? Are you focusing strategic meetings on where the money will be, rather than where it is going away from?
2. Market leader
The team at Adometry was able to focus their efforts on a market where they could become a market leader and give themselves a chance for a great acquisition. Sure they had competition, but if you aren’t a market leader how attractive can your business really be for a nice acquisition? The exception to this rule might be more of a talent acquisition, and those certainly happen.
I’ve heard entrepreneurs say things like “The market for animal food is a $62 billion market. If my business only takes 1 percent of the market we could be doing $620 million in sales! Let’s face it, all they eat is ground up [fill in the blank].” Here’s a bit of advice from one of my investors that applies to this situation: “I’m not interested in a company that can’t dominate a market!”
If you aren’t good enough to dominate a market than getting 1 percent of a market is going to be really tough. Maybe there’s a really good reason that 1 percent of the market is underserved, but if that’s the case your market size is the 1 percent that’s underserved not the other 99 percent.
Early stage investors want to invest in companies that are headed for market domination and where they can make a great exit – generally from 4x-10x or better depending on when they get in on the deal. As you pick your idea or consider potential pivots, try to find a place where you can say “we’re number one in…” as soon as possible. It’s easier to market, sell, and all the rest when you’re number one at something.
3. Disrupt yourself, even if you’re at the top
The last take away from Adometry (now Google) that I found interesting had to do with Adometry’s attitude. They were never content with where they were. They were a market leader with a great product, but they put time and energy into things like attribution of offline marketing – meaning understanding how well traditional marketing methods like TV or Radio converted into sales.
When I first heard about attribution of offline advertising and marketing, I thought it had to be close to impossible. Now that Adometry is part of Google, I imagine their ability to attribute offline marketing efforts gets a heck of a lot easier. That leads me to my last point.
Adometry was one of a few market leaders. Now that they have been acquired by Google, their ability to take their business to the next level has increased dramatically. As part of the Google team, they have access to way more data and are even closer to the actual searches themselves. What will happen to other “market leaders” as Adometry continues to integrate with Google and its amazing data? I’m not sure, but it’s clear that they now have a major competitive advantage. As for the Adometry team themselves? I’m sure their fine with how things have worked out, especially given the fun perks of being a part of Google.
Fake news? Well, what about fake reviews?
(BUSINESS NEWS) Amazon is swamped with fake reviews, making it harder than ever to trust whether or not a product is legit. How can you spot them and avoid falling victim to this shady practice?
These days, most of us have turned to online shopping in lieu of brick-and-mortar establishments to get our favorite items shipped directly to our front door. With many retailers still closed, and many more of us understandably wary of exposing ourselves to the risk of COVID-19, it’s easier to just click “buy” and then spend the next two days with our noses pressed to our windows in anticipation of the arrival of our new toy or garment. But are we at risk of being tricked by fake reviews?
If you’re like most people, you probably depend on product reviews to make a purchasing decision. Honestly, it’s perfectly reasonable to see what others thought of the item before you buy it. These online reviews are almost like your neighbor, who whipped out his lawnmower and bragged how it goes from 0 to 4 mph in less than thirty seconds. Obviously — obviously — you had to run out to your nearest garden center to pick up one of your own after his glowing review of it, right?
That’s kinda like online reviews, too. You can’t just knock on the purchaser’s door and ask them what they thought of it, which is why you carefully peruse those reviews and weigh those pros and cons. Okay, this shirt fits loose. Fine, these kitchen shears broke after three uses. Whoa, this brand of potato chips puts hair on your chest…? Sweet! And you also probably looked at those 3-star reviews, too, to see what was merely “meh” about the product. With this assortment of mixed reviews, you can be confident that you’re making a rock-solid choice.
Uh, sadly, nope.
Unfortunately, Amazon (as well as other major retailers, such as Walmart) are often fraught with a glut of fake reviews. In fact, there are numerous Facebook pages dedicated to the purchase of these reviews, and many of the reviewers are compensated with a monetary reward (usually the cost of the item, plus a few extra dollars for their work) for posting the glowing 5-star rave.
So what can you do to help protect yourself for falling for these seemingly harmless lies?
Well, first and foremost — a fake review isn’t necessarily harmless. If a defective or dangerous product is boosted by a false review, it can seriously harm you. Sure, there’s a good chance the fake reviews are benign, and the worst you’ll be in for it is losing a few bucks on a crap item. But if something is using counterfeit or unsafe ingredients (such as minoxidil in potato chips because, real talk, chips aren’t supposed to put hair on your chest), then yes, you need to be informed of it so you can make an educated decision about whether or not that item is coming home with you.
So, the question remains: How can you, intrepid shopper extraordinaire, avoid purchasing a lemon? (Unless, of course, your goal was to buy an actual lemon in the first place. Margaritas, anyone?) The good news is that there are a couple things you can do. For starters, common sense goes a long way. Do the reviews offer any context, or is it just line after line of, “Loved it!” without any actual feedback on the item? That’s why those 3-star reviews are so priceless. Usually the reviewer actually used the item and had a valid reason for their tepid review, allowing you to make an educated decision about it.
Finally, there are a couple of websites you can use to help you out. First, there’s Fakespot. This web extension will cull out all the fake reviews, allowing you to see at-a-glance the remaining genuine reviews. It then reviews the item for its credibility, letting you know if the seller was trying to pull a fast one on you. Then there’s ReviewMeta. Unlike Fakespot, this website goes through the views and instead of grading the seller, it actually grades the item based on the average score of the remaining real reviews. And by using both of these websites together to check those reviews? You’ve now got yourself a pretty decent idea if the product is actually worth your hard-earned dollars.
It’s far too easy to get scammed these days. However, by staying alert and remaining mindful about your online purchases (and avoiding the temptation to give into those stress-motivated impulse buys), you can avoid being bilked, too. And hey, instead of looking at online reviews, maybe you should go back to the old-fashioned way of doing it: By asking your neighbor for their opinions of items. Just, y’know, do it from at least six feet away, while wearing a face mask.
Manufacturing is bouncing back, but supply of materials is struggling
(BUSINESS NEWS) As manufacturing demands surge, so do material costs. The pandemic has shifted where we’re putting our money, but supply is struggling to keep up.
As the United States’ manufacturing process comes back up to speed, a surge in demand is creating a shortage of the one thing manufacturers need in order to do their jobs: Supply.
Fox Business reports that, due to a much quicker return to normalcy for manufacturing than some expected, a price hike for materials is affecting everyone from the bottom up: “Prices for steel, aluminum, lumber and other materials are rising in response to higher order volumes. Commodity supply chains are now clogged with orders, causing some producers to add weekend hours and overtime for employees.”
The fast manufacturing rebound seems to be a harbinger of better days ahead, but this supply bottleneck could dampen producers’ resolve.
It should be noted that the spike in demand for goods which use the materials in question isn’t an entire surprise. As Fox notes, much less of consumer money has been going toward travel and dining out. This has resulted in more money flowing into things like appliances, vehicles, and entertainment commodities.
But the toll is hitting producers coming and going as things like depressed oil and the paper used in packaging undergo substantial price hikes, leading some companies to stockpile resources in hopes of having an edge in the future.
Others find themselves in the uncomfortable position of having to choose between lower profit margins or higher prices on manufactured products—a choice that is sure to impact consumers, if not the rate of consumption.
Indeed, some companies, such as Northwest Hardwoods, have an upper limit on the price they can charge on a finished product regardless of rising material costs.
It’s not all bad, of course. Global prices for materials like aluminum and scrap steel have gone up, which means people like Brad Serlin—the president of United Scrap Metal—can make a killing. “We can sell everything we have,” says Serlin, referencing “big orders” from recently busy steel mills.
As the pandemic wears on, though, one thing is crystal clear: The high demand for domestic goods coupled with rising global prices for materials is going to make for some severe price hikes in the coming months.
Jeff Bezos steps down as Amazon CEO, moves into space travel
(BUSINESS NEWS) Jeff Bezos is stepping down as Amazon’s CEO in order to focus on other passions, such as his space company, Blue Origin.
Amazon founder Jeff Bezos will no longer be Amazon’s CEO starting in the third quarter of 2021. On Tuesday, Bezos announced he is resigning and will hand the job over to Andy Jassy, Amazon Web Services’ CEO. Bezos will transition to the role of Executive Chair on Amazon’s board.
“I’m excited about this transition. Millions of customers depend on us for our services, and more than a million employees depend on us for their livelihoods. Being the CEO of Amazon is a deep responsibility, and it’s consuming,” said Bezos to employees in an email. “When you have a responsibility like that, it’s hard to put attention on anything else,” he said.
By stepping down, Bezos says he will have more “time and energy” to focus on “other passions” like Blue Origin, his space company. In 2000, the billionaire started the rocket company to make space travel affordable and easily accessible by using reusable launch vehicles.
Since the company was founded, it has yet to reach orbit and is lagging behind Elon Musk’s Space Exploration Technologies Corporation (SpaceX). SpaceX, which began two-years after Blue Origin, has already achieved some huge milestones.
In September 2008, Falcon 1 became the first privately developed liquid-fuel rocket to reach Earth orbit. In May 2020, SpaceX launched two NASA astronauts to space.
Blue Origin has a lot of catching up to do, but, with more free time, Bezos might make sure the company moves full-speed ahead.
I mean, look at what he did with Amazon. In 1994, Bezos founded the multinational technology company. Since then, the e-commerce giant has grown into a trillion-dollar company. It has more than 1 million employees and millions of customers.
“This journey began some 27 years ago. Amazon was only an idea, and it had no name,” Bezos said. “Today, we employ 1.3 million talented, dedicated people, serve hundreds of millions of customers and businesses, and are widely recognized as one of the most successful companies in the world.”
There is no word about how much more involved Bezos will be with Blue Origin, but the company already has things to look forward to.
Last December, NASA selected Blue Origin’s New Glenn rocket to “launch planetary, Earth observation, exploration, and scientific satellites for the agency.” This contract will allow the company to “compete for missions through Launch Service Task Orders issued by NASA.”
Last month, it conducted a successful flight test of its New Shepard capsule, and many more tests are, without a doubt, in the company’s future.
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