🌶 Amazon + Whole Foods = Greater Than Sum of Parts 🌽

Amazon Whole Foods

All the talk of Amazon buying Whole Foods revolves around Amazon getting its tentacles even more into the grocery business. 

Talk about underestimating Amazon. Two articles I suggest reading to understand how Amazon thinks: Why Amazon is Eating the World and Amazon’s New Customer

Amazon is a different breed of company. Why? Its service-oriented architecture (SOA) structure. The Wikipedia definition of SOA: “services are provided to the other components by application components, through a communication protocol over a network.” In short, autonomous components that know how to talk to each other. At first glance, this would not seem revolutionary. Plenty of big businesses already have silos that never talk to each other and compete against each other for budget and credit. Sure I am sarcastic, but how does Amazon do SOA?

Amazon’s silos service customers internally and externally. They start out with an existing large internal customer, but they are designed to be used externally as well. Their warehouses are not only for Amazon merchants but any third party who needs order fulfillment. Selling through amazon.com is not a requirement. AWS is similar. It was created to power parts of the website but became a product to rent out.

Most companies build a product or provide a service. Imagine what happens when all the core activities are profit centers by using them internally and externally. How you create a product, service, or function changes. It is building a business that can thrive in a world of constant change. Instead, we have companies creating innovation labs whose outputs will have to be bolted onto existing processes and systems…unsuccessfully.  

As Ben Thompson points out, Whole Foods is not about getting into the grocery business. It is taking the Whole Foods logistics, re-architecting it so it can be used internally for Whole Foods, but any other industry/vertical that buys food whether its hotels, restaurants, assisted-living homes, schools, and so forth. They will be competing against Sysco and U.S. Foods.  

We thought Uber’s was in the logistics business because of UberEats and flower deliveries. However, that is small potatoes compared to Amazon when it wants to do everything from payment (money logistics) to drone deliveries and everything in between. 

A Real Organizational Chart

Whenever brands talk about change transformation, usually there are three pillars: process, technology, and communication.

The people component is assumed to be elements of all three.

Unfortunately, the hard part is people.

Externally you have investors, analysts, regulators to satisfy.

Internally you have competing power structures and budgets, misaligned incentives, matrix reporting structures.

In reality, the roadblocks are much more significant:

Example of Real Organizational Chart

Add in the fact humans don’t like change. Plus everyone’s favorite topic, corporate risk management.

We can try offshoring, nearshoring. We can try to add another piece of technology. We can try newsletters and coffee mugs.

None of it addresses the real problem.

How do people change or become comfortable with change in a faster-moving world?

Are alternative org structures like Wirearchy and Holacracy really a path forward?

Disruption and the Upcoming Chaos

Disruption and the Upcoming Chaos

Ben Sasse wrote a piece in the WSJ about how the political sphere is not dealing with economic changes head on. It’s written as if a government can do something about it.

When he talks about education and retraining, the problem is worse than he describes. Companies don’t train anymore. That’s because the fundamental purpose of business has changed. Ruthlessly (potentially) optimized to provide a product or service for maximum profit at all costs. People are a liability. Not only that, the skills most people can learn here, anyone anywhere in the world can learn and do it cheaper. If the radiologist can be sitting in Malaysia reading the chart of a patient in Midtown, an accountant in India is working on taxes for Deloitte, what job exactly does Sasse think will stay in the US? He says there are many potential policy responses available. Doubtful. None of them will be sustainable. Especially none that he can get through a Republican Congress. We won’t even get into automation.

Sasse alludes to it, most of the rules/religions we have and what we expect out of our lives were designed for living on farms when the family was the economic unit. It was for a time when having a bigger family meant more money. A boy knew as much as he was going to know about farming by the age of 15. He needed to start on the baby makin’. Concepts like waiting for marriage before being intimate meant something different 2000 years ago. Protestant work ethic was great when people were traveling on a wagon trying to stake out 100 acres in California in the 1850s. Will Durrant wrote about this. In an agricultural world, you could see religion in action, the cycle of birth, death, rebirth. It does not have the same impact when most of the population lives in dense areas, commuting, and pushing around pointless (digital) paper feverishly all day indoors or staring at tiny screens in our hands.

Whatever tribe (family, church, country, etc.) protected us and gave us comfort previously doesn’t know how to deal with the current avalanche of changes. We are in the ugly middle where the old ways don’t work anymore, but we haven’t found anything new to replace them with yet.

And anyone who says they have the answers is full of shit.

Alexa is Not about Voice Commerce

Alexa is Not about Voice Commerce

Many consumer brands are trying to incorporate voice interactions or voice commerce into their products. Apple has Siri locked in its ecosystem. So does Google for the most part. But Amazon is pushing Alexa to be the first mainstream voice touch point.

I wonder if that is the end goal. Sure Amazon would like a frictionless interface for consumers to buy more. My hypothesis is Alexa is meant to convince developers and startups that Amazon has all the products and tools that any “technology” company would ever need. The product line has everything from $5/month VPS instances that compete with Godaddy to running oil and energy market-related applications for GE. All infrastructure and data processing needs can be fulfilled within the Amazon ecosystem.

You would think that Google and Microsoft would leverage their expertise into selling more cloud infrastructure. Google’s revenue is overwhelming based on advertising. Microsoft’s comes from Office and licensing enterprise software. Both are in the process of shifting their mindset, but it is not a natural process. This direction might be in Amazon’s DNA or at least related to their previous experience with AWS. They built their website and realized they could leverage that knowledge and rent it out to others. They were the first big cloud provider that enabled developers and shadow IT groups to test, build, prototype and run their products in the cloud. Once hooked those customers were not going anywhere else as they developed more sophisticated products and moved on to other jobs. The use of AWS was organic. It had to be. They didn’t control any of the touch points like the operating system or devices (even though they tried).

How will we know if this hypothesis is correct? The easy answer is we see an uptick in new voice products developed on AWS. It will take time. Voice interactions or commerce have challenges. For example, the discovery of skills or apps. Can you search for Alexa skills without a phone or going through a website? We can’t turn the knob and find more content like on radio. Any form of monetization will be intrusive. How about interjecting ads? We all know how much consumers love pop-ups and interstitial ads. These points of friction require resolution. Otherwise, voice technology will have a short hype cycle.

Marketing Skills of the Future

Marketing Skills of the Future

Scott Brinker interviewing chief marketing technologist of Xerox:


8. Any advice you’d offer to someone starting out their career in marketing today?

Get very comfortable with fundamental martech tools, hone your creative and storytelling skills, and fearlessly dig into data exploration, analytics, insights, and visualization. I believe the future of marketing is in the hands of people who can compose a compelling blog post with personally-generated creative, while laying a few lines of Javascript and building a visualization of the results of the post with some code from D3.


Compare to the email sent out in preparation for the first course in Udacity’s Deep Learning Nanodegree Foundation:


Our team has compiled an excellent selection of resources for you, so please review these as you use this week of preparation to your full advantage:

Are you completely new to the world of Deep Learning? Read this fantastic introduction to Machine Learning.

Need a refresher on the basics of Linear Algebra? Have a look at this Udacity course.

Do you want to brush up Python skills? This Intro to Data Analysis Udacity course covers the Python libraries NumPy, Pandas, and Matplotlib.

Want to play around with a real neural network right in your browser? Check out this cool Neural Network Playground.

Never worked with TenserFlow before? Follow these instructions to download and install it.


We are severely underestimating the knowledge employees and agencies will need to have to optimize for the customer journey in the future.

If most brands can’t get digital right, or more thoroughly digital transformation (which includes big data), how will they take advantage of AI? Which to be successful, requires…big data.

State of…WordPress 2016

State of…WordPress 2016

You would think WordPress would be an easy sell nowadays. WordPress is not the right tool for every website, but the size of that pool is shrinking. It powers a significant chunk of the web.

Automattic has already leveraged WordPress into business with their VIP WordPress service, meant for high traffic sites. Facebook runs their company blogs on it. Practically every large news publisher has something running on VIP WordPress, like NY Times, Washington Post, CNN, and many others. Using that platform, now it is actively (aka spending ad dollars) going after the SMB market with a hosted solution against the lower priced services like Bluehost or Host Gator.

Still…

WordPress has a yearly “State of the Word” thingie. The most recent one:

The significant bit during the speech was the creation of the WordPress Growth Council. Why? Proprietary CMS competitors will spend $320 million on advertising, some of it directly against WordPress. In Matt’s words (around 27:30 in the video):

“Advertising does work…even though I think we have a better product and infinitely better community, we are starting to see in certain markets these tools which are typical proprietary, start to pick up shares.”

The Growth Council as a concept is not flushed out, but Matt / Automattic wants to start working on it, and he wants a small number of companies that work with WordPress to help figure it out. It will be interesting to see what direction they take.