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🐇Rabbbits Weeekly: Own The Demand 🕳️
Why you should aim for demand over supply. A not-so-Merry Christmas for Meta. Plus some headline-like stuff if you like marketing and market news-like things.
Hey, it’s Kyle, the guy who, I don’t know, clicked a lot of links this weeek so you didn’t have to?
This weeek: why you should own the demand, Meta’s metaverse and EU woes, and some headlines about ads, retail, the æconomy, analytics, algorithms, and attack vectors. Plus, links to a few other things I wrote.
Own The Demand
We live in the Platform Era. Aggregators rule the day—from Amazon and Google to TikTok and Uber.
It’s the marketplaces that make the money.
In our current era, attention and currency are synonymous so “marketplace” doesn’t have to mean commerce, a la Amazon. TikTok is a marketplace of content. Google is a marketplace of information. Facebook is a marketplace of connections.
Of course, when framed as marketplaces it makes everything feel more like an extension of history. The market has been the center of activity for towns, cities, regions, populations for a long time now. It’s been the maker of fortunes and the spreader of news. The market has been the gathering place. The difference now being that it’s been digitized and the major players have gone meta—owning the space the market happens within instead of just participating within it.
This rabbbit hole line of reasoning is brought to you by: this post called Own The Demand.
It argues (rather convincingly, even if it is just a reflection of the current Silicon Valley vault of 10x’ing playbook) that it is both better and safer to own the demand instead of the supply. The same level of pricing/market power with fewer production concerns.
There’s this famous comment that “Uber owns no cars; Airbnb no real estate; Facebook no content; and Ebay or Alibaba no inventory.” If you can get away with being 1% as capital-intensive as your competitors while extracting greater profits, why wouldn’t you do it?
In logistics, it’s all about the “last mile”. That’s the hardest, most expensive part of any delivery chain. It’s also what connects the supplier to the end consumer. Controlling that “last mile” is owning the demand.
If you want a shot at a mega-business, control the last mile for the sandbox you’re playing in.
As an aside, Uber’s mission statement used to be way better:
Uber is a two-sided marketplace, yet its mission statement used to be “transportation as reliable as running water, everywhere and for everyone” (is it now “We ignite opportunity by setting the world in motion”).
The newer one feels grandiose and aspirational, but what does it mean? What vision does it instill?
The original is both clear and a useful decision-making check: “does this make transportation as reliable as running water?”
(Maybe the NYC Uber air taxi idea failed that question filter so the mission had to become more abstract to allow it. Optionality strikes again?)
Not So Merry Meta-mas
The head of VR hardware development at Meta, John Carmack (co-creator of DOOM), is leaving. But he made sure to leave a flaming pile of poop on Zuck’s front porch on his way out.
In an internal memo (that leaked, naturally), he said things like:
We have a ridiculous amount of people and resources, but we constantly self-sabotage and squander effort. There is no way to sugar coat this, I think our organization is operating at half the effectiveness that would make me happy.
He also said (more or less) that his ideas are mostly ignored and openly complained about things during a recent Meta event keynote.
A year ago he was saying:
we should be wary of "architecture astronauts" who do a lot of high-level hand-waving instead of building viable products that customers find useful.
Hell of a way to end the year for Zuck’s dream-turned-nightmare.
The EU doesn’t like Facebook Marketplace. One reason is because Big Blue users automatically get access, “whether they want it or not.” Another is the data collection possibilities, which, have you met a large internet company? (Or a retailer with a store brand?)
On one hand I understand the concerns. Especially since the EU is more concerned about competition and anti-monopoly positioning than “consumer benefit,” usually via the method of price (the US flips that). On the other hand this seems like a clear signal that incumbent companies shouldn’t try to innovate.
This ruling could more firmly entrench the trinternet. And could push large internet platforms to “localize” operations to a certain extent.
TikTok is the (technically) non-Chinese version of Douyin. And Project Texas is supposed to mean US user data gets processed and stored on US soil (what happens if you like a video from someone in Japan? where does that data live?). The Trend Machine could be on the forefront of another trend, this one more technical and less interesting (probably) to users.
Retail Tea Leaves
The season of gifting to others is over, ‘tis the season of self-gifting now. As shopping picks back up to end the year—a result of people getting cash or gift cards or not getting what they wanted—some retailers are keeping the sales going to capitalize.
Amazon will level the playing field for third-party sellers thanks to a settlement with the EU. Will these measures extend beyond the bloc’s borders? (Consider this a counterpoint to the Meta story.)
Last weeek I mentioned a bipartisan bill to ban TikTokin the US, which is apparently gaining in popularity. But it appears The Trend Machine has to deal with more than just “what ifs” at the moment.
As state governments ban TikTok on government-issued devices, so do public universities. Bans range from just restricting access on university-issued/owned devices up to blocking access on all campus networks. This should be interesting to watch.
Oh, and, some Chinese Bytedance employees definitely accessed personal info on a couple US journalists over the summer “as part of an unsuccessful effort to investigate leaks of company information.” But don’t worry, they’ve been fired, so everything is fine now. Right?
Not specific to TikTok, but beware of social media scams, especially around holiday gifting and shopping. People lose a lot of money to them, don’t be one of them.
The FBI is recommending ad blockers to combat malicious ads that impersonate legit brands to trick users to install data-stealing malware.
Wonder why you’re seeing that video in your For You feed? TikTok will tell you now.
Tumblr is doing it live. Live-streaming that is.
Apple, Google, and Mozilla are teaming up to create a next-gen browser benchmark that their browsers can then be measured against.
Microsoft is working on programmatic in-game advertising for streaming games that would aim to blend with the game environment and only display during “low action” moments.
Facebook’s all-in-on-automation Advantage+ Shopping campaigns are awesome and totally work! (Says Meta (a friend got beta access early on and said it was garbage but this should be a feature that gets better with time so hopefully we’re seeing those improvements already.)
Google Analytics 4 has added more features that make it almost ready for release, except it’s been out for a while and now Big G is desperate to get people switched over. Now you can: use Sheets to migrate your audiences from Universal Analytics and personalize the home page metrics. Almost like the tool is supposed to serve you instead of vice versa.
Inflation not enough for you? Add in a dash of avian flu and watch the price of eggs soar. Food prices are rising across the board, but eggs are lapping the field.
A Few Other Things I Wrote About Recently
Thanks for reading! Apologies now if I blow up your inbox the rest of this weeek to close out the year.