"If there’s one thing that can compete with free, it’s convenience"
This is my 2nd note talking about Convenience as a theme. Last year I wrote the following post- Convenience will Create the Next Big Profit Pools which highlighted certain observations that made me realize the power of convenience.
Since then, my conviction on Convenience as a theme has only grown as I observe how these businesses are growing.
One of the core tenets to my bullishness on this theme comes from an understanding that we are in the 2nd leg of convenience led businesses wherein the initial leg work of making consumers habitual to convenience by offering them services at breakeven or loss has already been done by 1st set of convenience led businesses like food delivery, ride sharing, e-commerce, streaming etc.
And now the next set of convenience led businesses that are being built have an existing platform in terms of habit formation and thus monetization would be quicker and even higher.
This tenant got further solidified from reading the following post- The Illusion of Acceleration
I’ll highly recommend everyone to read that post in entirety. The post basically talks about certain factors which defines the rate of adoption of newer technologies.
One of those factors is Compatibility. The post compares the rate of adoption of telephone vs cellphones and highlights why cellphones adoption was so much faster than telephones.
Snippet from the blog-
“The reason, again, is pretty obvious: in the early days of the landline, when fewer people had them, there were fewer people to call. Telephones are only useful when you have someone to call. In addition, it wasn’t yet an accepted part of everyday life to call your mother every Sunday. Phones were less compatible with people’s lives.
““Cellphones were also compatible with the previously introduced telephone: when you got a cellphone, you could call anyone, not just other people with cellphones. Cellphones were much more compatible and so they were adopted more quickly.”
The crux here is that if consumers have used a similar service or paid for a similar service, they will be quick to adopt a new & better innovation in the same space.
The same is playing out for newer convenience led businesses like quick commerce wherein you already have a large customer base who is already used to ordering products & services through their mobile apps for better convenience.
And thus, the rate of adoption of quick commerce and even the monetization is so much faster than what it took for something like food delivery or e-commerce.
My closing thoughts here would be same as what I shared in my last year’s post;
The more I think & reflect on this, the more I realize the kind of impact convenience has had in creating profit pools in the last few years and how powerful convenience as a theme is, in its potential of creating substantial profit pools in the coming decades.
In fact, at its core, the entire internet economy has been built on the model of providing a new & convenient way to do things like booking tickets, carrying out financial transactions, social interactions, consuming content, conducting business and so much more; and all of these have either expanded existing profit pools or created new profit pools.
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