Amazon work culture and the weekly roundup in tech and retail:

News and commentaries

Are working hard and having a work-life balance mutually exclusive? This question was on top of my mind as the New York Times piece on the working conditions at Amazon take the spotlight this week. I personally know some people who would thrive on an “up-or-out” culture and I bet they would say something like: Working at Amazon is hell, so what? Personally, I think that the NY Times piece was slightly sensationalized:

Instead, Amazonians are instructed to “disagree and commit” (No. 13) — to rip into colleagues’ ideas, with feedback that can be blunt to the point of painful, before lining up behind a decision.

Would you rather work in a place where consensus is always king, up to a point when the sh*t hits the fan because nobody asked the hard questions? There are more snippets like these that criticize Amazon’s leadership principles which is probably quite similar to a lot of prestigious companies. I don’t see anything wrong about that.

It is important to note though that a viral LinkedIn post defending Amazon came from someone in a senior position, male and an engineer. And I believe him when he says it’s a great place to work. For sure, engineers are highly valued and would have no problem leaving if the conditions are bad, but what about everyone else? What if it’s just a regular Joe or Jane in a low-to-mid level position outside of engineering? Just wondering.

Here are this week’s most relevant news in tech and retail:

In tech:

  1. Extramarital dating service Ashley Madison headaches continue as hackers release new data targeting site’s CEO and operators
  2. Ride-sharing: GrabTaxi, an Uber competitor in Asia, raises $350 million to grow its e-hail vehicle service across Southeast Asia; Uber lands strategic investment from India’s Tata Opportunity Funds, a private equity sponsored by Tata Capital; Uber’s fundraising presentation shows it will reach $10.8B in bookings in 2015
  3. Google: Google launches $199 WiFi router OnHub; Life Sciences team graduates from Google X and will be a standalone entity under newly-formed Alphabet; Google’s data center in Belgium is hit by lightning, causes permanent data loss for some users; Same-day delivery service Google Express shuts down two delivery hubs in San Francisco and Mountain View, CA
  4. Gartner: Worldwide iPhone sales grew 36% YoY, while Android YoY growth lowest ever in Q2
  5. Intuit, Inc., maker of TurboTax, to divest itself of Demandforce, Quickbase and Quicken

In retail:

  1. Jeff Bezos responds to New York Times report slamming Amazon’s working conditions, recommends a LinkedIn blog post by Amazon employee Nick Ciubotariu as counterpoint
  2. Home shopping network QVC to buy flash sales site Zulily for $2.4 Billion
  3. Singapore online grocery service RedMart raises $26.7M ahead of Southeast Asia expansion
  4. L Brands, owner of Victoria’s Secret and Bath & Body Works, raises per-share earnings guidance for the year on continued sales growth
  5. India’s fashion discovery site Roposo raises $15M in fresh funding
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A new Amazon competitor, Jet.com and the weekly roundup in tech and retail

News and commentaries

This week’s biggest news are all about retail. Jet.com, a startup with the intent of competing against Amazon, came out of beta and is now available to the public. It works like Costco with an annual membership fee of $50 but you get access to major online stores – Amazon (yes, even Amazon), Walmart, Costco, Target – and to smaller independent retailers. The beauty of Jet is that the more you buy, the more discounts you receive to a point that the company will actually and most definitely lose money. Seems too good to be true, right? The company will solely rely on membership fees for revenue generation. I haven’t signed up yet but I will as soon as I’m ready to test a bunch of products but you can check out the service for a free 3-month trial here (and there’s no auto-enroll, even more remarkable).

Amazon is also in the news this week for posting unexpected profits for the second quarter of 2015 and for beating Walmart’s market cap. According to Wall Street firm Cowen & Co, Amazon is also expected to surpass Macy’s as the top apparel seller in the country by 2017.

In tech:

  1. Apple’s third fiscal quarter report shows 38% profit increase but iPhone sales miss Wall Street’s lofty expectations, shares fall as much as 7%
  2. Palantir Technologies, a private big-data company that serves the military, CIA and NSA, raised $450M at a $20B valuation
  3. Jeep hacking http://www.wired.com/2015/07/hackers-remotely-kill-jeep-highway/
  4. New York City puts off proposal to curb Uber rides in the city after reaching truce
  5. Oracle is seeking to update copyright lawsuit against Google to include Android OS

In retail:

  1. Startup e-commerce site Jet.com opens to the public to take on Amazon
  2. Amazon stock surges with unexpected Q2 2015 profits
  3. Kate Spade releases new product lines to become a complete luxury lifestyle brand
  4. China’s e-commerce company JD.com teams up with Taylor Swift to sell a new fashion line for Chinese shoppers
  5. Hermès reports 22% increase in Q2 sales buoyed by Japan

Amazon’s Kiva robots and the weekly roundup in tech and retail

News and commentaries

It’s that time of the year when spirits are high despite the cold of winter. But more practically, it’s that time of year when retailers are scrambling to amass the majority of the year’s revenues. This year, retailers went for Cyber Week instead of just Cyber Monday and pre-pre-Black Friday events. But this strategy of trying to one-up each other resulted to shoppers spending less during Thanksgiving and Black Friday. Sales at brick-and-mortar stores within the 2-day period reached $12.29B which is a 0.5% decreased compared to last year. Online spending is on the rise though. According to a report from Adobe that tracked online spend from November 1st to November 28, $32B was spent online – 14% more than in 2013. See my post here regarding mobile spend with special focus on iOS and Android use.

With all the shopping being done, I keep thinking of the scale of the logistics involved. Ahead of Cyber Monday, Amazon released a video detailing a part of those logistics. Meet the Kiva robots from Kiva Systems, a company that Amazon acquired in 2012 for $775M.

But if you prefer the fantastical reason for how those Christmas gifts arrive, you can track Santa via Google.

Here are this week’s most relevant new in tech and retail:

In tech:

  1. New details emerge from last week’s Sony data breach: budgets, layoffs, passwords and  47,000 SSNs exposed
  2. Apple is defending itself against a class-action lawsuit alleging that iTunes prevented iPods from playing music from other digital stores and capturing market share; named plaintiffs down to one
  3. Intel teams up with Google Glass partner Luxxotica to make smart eyewear
  4. Uber just raised $1.2B, valuing the company at $40B
  5. Microsoft and Barnes & Noble end Nook reader partnership

In retail:

  1. The National Retail Federation reports decreasing number of holiday shoppers over Thanksgiving weekend, down 5.2% from 2013; but online spending is on the rise according to IBM and Adobe reports
  2. Financial reports: Leather goods maker Mulberry reports first-half loss; Tiffany shares surge after report of better-than-expected same-store sales increase of 4%
  3. Coach and Brown Shoe Company among bidders to acquire woman’s luxury shoemaker Stuart Weitzman, deal expected to reach between $600M and $700M
  4. Fashion resale site Poshmark hits $100M in revenue, begins luxury goods authentication
  5. Amazon starts selling its own line of diapers and baby wipes, Amazon Elements; available only to Amazon Prime members

Amazon Echo, Nexus 9 and the weekly roundup in tech and retail

News and commentaries

Amazon is in the limelight this week with the invite-only release of Echo, a Siri-style assistant for your home. From the promotional video, asking Alexa (the name for Echo) about the weather, settling fact disputes and even asking “her” for word spellings can either be creepy or cool. This is another big move for Amazon to insinuate itself into consumer’s lives in every way possible and of course to sell things. After all, you can dictate shopping lists to Alexa. I wrote a little bit about Amazon’s seemingly scattered strategy to be the platform of our lives here, but I have to say Echo is a very bold move. Now, if only it’s more than hype and it can actually deliver – which was not the case with the Fire Phone. I have asked for an invite to purchase Echo. If I do get it, expect an update and a review.

Somewhat related to Amazon, I recently received the new Nexus 9. I currently have the iPad mini (a throwback to my MBA where we used it at school for PDFs, etc) and have only been using it for Amazon Instant Video. Last month, Amazon *finally* released the Android version of the app and despite the really roundabout way of installing it on my Nexus 5, I thought this would be the perfect time to completely port over to an Android tablet. Surprise, surprise – the Amazon Instant Video app only works on Android phones even though there is an “unofficial” way of installing it on Android tablets. I am still considering it because I do like the Nexus 9. It’s hard to believe that Amazon is largely ignoring Android users but then again, in Amazon’s view, if you’re not an iOS user (a market that would be too difficult to nudge), then get yourself a Kindle Fire. I’m sorry Amazon, but I’m not there yet. I just might use the turnaround install on my Android tablet after all.

Here are this week’s most relevant news in tech and retail:

In tech:

  1. Amazon news: invite-only release of $199 Siri-style assistant Echo ($99 for Prime members); third party retailers to offer free shipping for Prime members; free unlimited photo storage for Prime members; launch of same-day delivery in Toronto and Vancouver
  2. Alibaba‘s first earnings report post-IPO beat estimates, fiscal Q2 shows 54% sales growth
  3. Xiaomi, the Chinese smartphone manufacturer, is set to raise close to $1.5B in new capital at a valuation of $40B
  4. Microsoft Office suite for iPad, iPhone and Android is now free; announces strategic partnership with cloud storage service Dropbox
  5. Google Cloud Platform slashes prices again, becomes even more enterprise-ready with VPN, carrier interconnects and peering

In retail:

  1. Michael Kors Holdings Ltd. fiscal Q2 sales rose 16% but missed estimates, shares tumble
  2. Gap Inc.’s brands Gap and Banana Republic sales drop but earnings beat estimates in preliminary Q3 report; official report to be released on Nov. 20
  3. Store openings: H&M opens 27,000 square-foot new Paris flagship on Boulevard Saint-Michel; J. Crew further expands in Europe, will add fifth store in London Q1 2015 and will open first Paris store in March 2015
  4. Kate Spade reports 30% jump in sales for Q3 as demand rises in North America, raises global same-store sales growth forecast for 2014
  5. Hermès International reports Q3 sales growth of 10.6% despite sluggish demand in China

Amazon’s new Fire phone and why I’m not buying just yet

News and commentaries, Technology

 

Dynamic Perspective in Maps

Yesterday, Amazon and Jeff Bezos unveiled the Fire phone during an event shrouded in mystery, ending the weeks-long speculation. The phone definitely packs a punch and could be serious contender in the smartphone market especially as it is backed by Amazon’s ecosystem: full year Prime membership which means access to all that Prime has to offer. But the most groundbreaking and exciting features are the “Dynamic Perspective” and Firefly.

Dynamic Perspective
In order to generate a 3D viewing experience, the tech works by tracking where the user’s head is at all times in relation to the screen. In doing so, the user will always have the perspective of looking at a 3D image. Do you remember those 3D posters in the ’90s? Looking at the Fire phone video, it reminds me of those except obviously in this case, you don’t need to focus too hard to get the perspective that the image is floating, i.e. in 3D rendering. This feature is especially compelling in the phone’s map app and in gaming. The question is how many more apps will be built on the Dynamic Perspective SDK.

Firefly
First of all, as a huge fan of the Firefly TV series (which happens to be available in Amazon Prime), I already like this name (did Amazon pay for the name?). In a similar way that Shazam can tell you the name of a song after “listening” to it, Firefly can identify products, songs and TV shows by “looking”. The Firefly database has currently 70 million products; 240,000 movies and TV episodes, and 160 live TV channels. It can also scan text on paper for phone numbers, web and email addresses.

These two features alone are making me seriously consider the Fire phone for my next device. I currently have a Nexus 5 from Google and have been looking forward to Nexus 6. I mention this because the fact that I am deeply entrenched in the Google ecosystem might be the biggest dealbreaker for me. Below, I outline more of the reasons as to why I and others like me might *not* want the Amazon Fire phone.

Dealbreakers

  • The phone is powered by Fire OS 3.5.0, which was built on top of Android OS and integrates Amazon’s software and content. As such, it does not have have any access to the Google Play Store nor any of Google’s apps such as Google Maps, Chrome browser or Gmail. Amazon has its own mail app and uses Nokia’s HERE maps.
  • There seems to be a slew of features and gesture controls related to Dynamic Perspective. Apple’s smartphone dominance is largely attributed to its simplicity such that even your grandparents now have iPhones. The Fire is definitely not simple. Case in point from the Fire promotional video: you can tilt the phone to the right to access the menu. Or is it the left tilt – you get the point. Even with instant Mayday access, a human-to-human customer service designed to help with the features, who has the time or the inclination to talk to someone when all you want to do is send an email?
  • Dynamic Perspective looks exciting but without developer adoption, users would be limited to using Amazon-developed apps. It’s not clear yet how many apps are there to render the 3D perspective but a robust app marketplace needs to be in place in order for the tech to resonate with users.
  • With plenty of other options in the smartphone market, Fire is not exactly price friendly. Sure, it goes for $199 with a 2-year AT&T contract but hasn’t Amazon heard of T-Mobile’s Uncarrier strategy? For those who are loath to get stuck with AT&T, the phone comes for a hefty price of $649 – quite a leap for a smartphone that is just entering the market even with all the bells and whistles.

So, if you consider yourself as an innovator in the tech adoption curve, *and* you don’t mind the price point, then this phone is for you. But for the rest, you might want to wait this out and see what shakes loose especially in terms of what apps will be developed for the Fire phone. Unfortunately, it is the “waiting out” period for most consumers that could prove Fire’s undoing if it wants to be *the* next smartphone platform.

Meanwhile, as of this writing, AMZN stock is down by 6%.

AMZN 2014-06-19 at 12.31.39 PM

Instacart’s entry into US grocery delivery market

News and commentaries, Technology

Grocery warsOn April 17, Techcrunch reported that Instacart, the Y Combinator alum and grocery startup, could potentially raise a big round of financing that would value the two-year old company at $400M. Instacart, which has raised $10.8M to date, is a web and mobile app for grocery deliveries. With the use of “Personal Shoppers”, customers can order grocery items from local stores as well as big grocery chains such as Whole Foods and Costco. The company operates independently with no requisite affiliation with the stores. Instacart makes money through delivery fees of $3.99/order and by marking up grocery items by as much as 30%. “Personal Shoppers” are considered independent contractors and paid per delivery. It is currently serving San Francisco Bay Area, Los Angeles, New York City, Chicago, Boston, Washington, D.C. and Philadelphia.

My personal experience with grocery deliveries
I first heard of Instacart in March 2013 while living in Palo Alto with a startup, Kalibrr. We used it once because of a discount code; not knowing that grocery items were marked up and despite the company’s promise of delivering within the hour, that was not necessarily the case. We have not used Instacart again after that.

However, I am a big fan of grocery delivery services in general since I dislike grocery shopping and have mostly been car-less while living in metropolitan cities. In New York City, most grocery stores deliver but they still require for you to show up and pick up the items yourselves. Still, it was a convenient way to shop without having to lug the bags around the city. In Boston, I had a great experience with the Peapod grocery service. My only complaint was that I was limited to picking items from Stop & Shop – not exactly my favorite grocery store.

Whether it’s Instacart in Palo Alto, Peapod in Boston or Whole Foods in NYC, the reasons I would use a grocery delivery service are similar across the board:

  • Convenience. Without a car, carrying groceries from the store is a pain. Also, grocery stores in big cities are relatively small which makes grocery shopping stressful and time consuming (due to the volume of shoppers).
  • Time constraints. There are times when there is simply no time to go to the store and buy the essentials. This can only happen if you have the sudden urge to invite a bunch of friends for a dinner – I’ve been know to do that (at least before motherhood).
  • Ease of use. If using the service gives the same amount of headache as simply showing up at the store then it’s not worth it. The headache can come from the time window for the grocery, the in-app user experience, and the quality of the grocery items especially for fruits and vegetables. Except for the time window, I’ve mostly had positive experiences with the services I’ve used.

I actually did not consider pricing, having the belief that the differences were too minimal. That is, until Instacart which I perceived to be too high of a markup for it to be worth the money.

Who are the players in grocery delivery?
With this recent news of Instacart’s impending round of financing, it got me interested in the grocery delivery landscape in the US. Most of us know of Amazon’s determination to dominate the market with Amazon Fresh but it is less well-known that Google is also testing the service. Apart from Instacart, here are the major players so far:

  • Amazon Fresh. Initially started in Seattle, WA, it has since expanded to Los Angeles and San Francisco. In order to access the service, customers have to subscribe to Amazon Prime Fresh for $299/year and includes all the benefits of Amazon Prime. Notable features within the subscription includes Dash, a device that allows customers to add items to the grocery list by saying or scanning grocery items. Another feature called Prime Pantry was recently added for heavy and bulky items, though this is also available to Amazon Prime members.
  • Google Shopping Express. The same-day delivery service was first introduced in San Francisco and the San Jose peninsula area on March 2013. Customers can shop from big retailers such as Target, Costco, and Whole Foods for $4.99/order after a free 6-month trial. It has recently expanded to Los Angeles but still limited to Google employees.
  • Peapod. The company is the oldest of the bunch, which was started in 1989 in Illinois. The company claims to be the world’s first e-commerce only company and has since been acquired by a Dutch company Royal Ahold in 2001. Groceries are from Ahold USA companies: Stop & Shop and Giant Food Stores. The service is available in: Chicagoland; Milwaukee; southeast Wisconsin; Indianapolis, IN; Connecticut; Massachusetts; southern New Hampshire; New York; New Jersey; Maryland, VA; Washington, DC; Philadelphia, PA and southeast Pennsylvania. Customers are charged a per delivery charge which varies on the delivery time window that the customer chooses; averaging around $8/order.
  • FreshDirect. First introduced to New York in 2002, the company differentiates itself by delivering organic and locally grown produce as well as freshly prepared meals. It has since expanded to Philadelphia in October 2012. FreshDirect charges $5/delivery.
  • Walmart To Go. The service for same-day delivery of general merchandise was launched in October 2012 in Northern Virginia, Philadelphia, Minneapolis and San Jose/San Francisco. It has since included grocery deliveries for Denver, CO and San Francisco. Starting at a minimum order of $30, it charges customers $5-$7/order.

What is the play for Instacart
With the entry of massive companies like Amazon and Walmart, it is difficult to envision the profitability of Instacart. While big companies can leverage their logistics and play with razor thin margins, Instacart has to mark up grocery items to remain profitable; a move that might scare away price-sensitive customers. Scalability becomes a problem as well since the company relies on contractual foot-runners to do the deliveries. Complaints regarding delivery times can only increase as they expand and acquire more customers. These are definitely top of mind for the founder and CEO, Apoorva Mehta, who used to work in Amazon’s fulfillment optimization engine.

There’s also a question on the lack of affiliation with grocery companies. At the moment, the startup is still under the radar but would Whole Foods eventually catch on and crack down on the Personal Shoppers and Instacart’s pricing? If the grocery chains enforce a revenue affiliation program with Instacart, that could further cut into the company’s profits.

With these questions in mind vis-a-vis Instacart’s potential valuation, investors might be gearing Instacart as an acquisition target rather than as a viable business model. A company like Amazon with ambitions of dominating the $500B grocery industry can certainly leverage the company’s rapid expansion in major cities (7 cities in 2 years), growing customer base, and its last-mile delivery system with their Personal Shoppers. It doesn’t hurt that the CEO/Founder is a former Amazon exec.

May 9, 2014 update: Instacart is now in Seattle; Google is out of beta in LA; and Amazon Fresh is also now in LA.

Weekly roundup in tech and retail

News and commentaries

Here are the most relevant news this week in tech and retail.

In Tech:

  1. Apple’s Q1 results show strong iPhone sales, record revenues; company authorizes a stock split, shares surge at 8% and activist investor Carl Icahn is pleased
  2. The Supreme Court heard oral arguments that will decide the fate of Aereo, the startup that lets subscribers watch live TV for $8/month
  3. Microsoft finalizes acquisition of Nokia’s phone unit
  4. Google+ lead Vic Gondotra is leaving Google; media speculates on the death of Google+
  5. Zynga founder, Mark Pincus to leave chief product officer role, remains chairman on the board

In retail:

  1. Nike fired the majority of FuelBand teaminsists that FuelBand is still alive and well
  2. Amazon Q1 earnings meet expectations with 23% rise in sales despite a report saying that online sales tax has reduced consumer spending
  3. More Amazon news: Prime members now have access to HBO programs and Pantry, a service that delivers bulk grocery items for $5.99/four-cubic-foot box
  4. Kering, owner of Gucci, reports higher than estimated quarterly sales
  5. UK fast fashion retailer Primark to enter US market via Boston; will occupy the former Filene’s Basement space 

Weekly roundup in tech and retail

News and commentaries

Here’s the most relevant news this week in tech and retail.

In Tech:

  1. A massive 2-year security flaw in OpenSSL, Heartbleed, was discovered April 7 and affected companies scramble to patch it up – from websites to routers
  2. Google news. Google Glass will be available to anyone in the US for 1 day only on April 15 at 6 AM ET, sign up here for the reminder; Google can now continuously scan apps for Android users to protect against malicious code
  3. Dropbox news. Dropbox announces: Project Harmony, which allows for collaboration for Microsoft Office files; Mailbox for Android; and Carousel, an app for photo/video archiving and sharing
  4. Amazon news. Amazon introduces Dash device for scanning and adding items to Amazon Fresh shopping list; Amazon acquires Comixology, a cloud-based digital comics platform
  5. Twitter acquires Cover, an Android lock screen app, which displays apps on an Android lock screen based on context and historical use

In Retail:

  1. LVMH  shares surge Thursday as company reports 9% rise in Q1 2014 like-for-like sales of its fashion and leather goods, Louis Vuitton – a good sign for Nicolas Ghesquire’s appointment as artistic director
  2. After closing its stores in February, Loehmann’s is set to come back online in May
  3. Calvin Klein owner PVH invests in Karl Lagerfeld – the minority investment will allow the company to have the “right of first offer to license the brand in North America
  4. Social shopping app, The Hunt, raises $10M in Series B funding led by Khosla Ventures
  5. Kering, owner of Gucci may acquire lifestyle and sports brands within 3 years as it assesses its Puma brand

Weekly roundup in tech and retail

News and commentaries

Here’s the most relevant news this week in technology and retail.

In Tech:

  1. Amazon announces streaming service Fire TV to compete against Google’s Chromecast, Roku and Apple TV
  2. Microsoft slashes prices on cloud services by 35%-65% in response to recent price cuts from Google and Amazon AWS
  3. Square now accepts Bitcoins which can help push for more mainstream acceptance of the crypto-currency
  4. Microsoft introduces the Cortana personal assistant years after Siri and Google Now
  5. Google splits into two: GOOG (Class C, non-voting) and GOOGL (Class A) for Sergey Brin and Larry Page to maintain control

In Retail:

  1. Prada SpA falls due to slowing luxury sales growth, optimistic in new stores and improving its supply chain
  2. Alibaba buys 26% stake in Intime Retail, moves into brick and mortar stores
  3. UK online retailer Asos first half earnings down due to expansion investments in new stores and product offerings
  4. Marks and Spencer to open 250 stores over the next 3 years to grow global sales by 25% and profit by 40%
  5. Hudson Bay Company shares, owner of Saks Fifth Avenue, fall 9% as the company forecasts weaker-than-expected 2014 earnings and plans to spend more on e-commerce

Amazon Prime membership increase

News and commentaries

amazon_prime_email

So it did happen. As I’ve mentioned in my previous post here, I definitely have the willingness to pay the $99 price tag. As Mashable points out, $99 comes to $8.25/month which is only slightly more than Netflix or Hulu at $7.99/month. For my part, I actually cancelled my Netflix in favor of Amazon Instant Video and only watch the free version of Hulu. Besides, I have the benefit of coming off of a fresh Amazon student prime membership which means I will be paying the old rate of $79. So, yes, I will remain a Primer. Good stuff.

What about you? Does the $99 price tag turn you off of Amazon Prime?