Facebook Messenger: The Trojan Horse

messenger

In 2013, Facebook tried and failed to create its own phone.

Now Facebook has come back with a more considered vengeance, and announced today at F8, its developer conference, the inception of Messenger Platform, which will play nice with third party apps, and ultimately, I believe, achieve some of the results Facebook sought back in 2013.

Facebook seems to have taken two distinct paths with its platform:

1. It has actively unbundled apps from the “big blue F.” Acquisitions like Instagram and Whatsapp have stayed mercifully separate from Facebook’s primary service.

2. It has developed Messenger into an ecosystem unto itself, first by unbundling it from the primary Facebook app, and then by subsequently integrating payments, and now, other apps, into the service itself. This strategy borrows very heavily from international competitors like Line and Kik, which have offered banking and related services as part of their messaging apps for quite a while.

Facebook’s strategy is predicated upon slowly gobbling up the functionality of other standalone apps. Consider its new “Messenger for Business” feature, which allows firms like Everlane, USPS, or Zulily to communicate directly with customers. This feature could have been a standalone app by a different developer, but Facebook, with its unparalleled user base, is the perfect partner for retailers – who can presumably get more data – and for buyers, who’ll get quicker customer service on an app they already have installed.

And although it can’t own the device ecosystem, it’s slowly sliding a blue, chat-bubble shaped horse into Apple and Google’s camp.

Facebook Messenger: The Trojan Horse

Facebook Messenger, Now with Payments

paymentsFacebook recently announced the rollout of a payments service which will be embedded within its popular Messenger app, leveraging its already-vast user base. This move was obviously a long time in coming, and it follows on the heels of Google Wallet, Apple Pay, and, most similarly, Snapchat’s Snapcash feature. I am certain that, down the line, Facebook will use this new feature to more smoothly facilitate birthday gifts or online marketplaces.

The issue with most payment services is the “opt-in” nature. I’ve tried to pay – or be paid – by friends for various expenses, and the most common issue would be that I didn’t have Venmo, they didn’t have PayPal, or, in a commercial setting, that a vendor might not have an NFC reader for Google Wallet or Apple Pay.

Facebook’s ubiquity – both nationally and globally – means that there is a pretty minimal barrier to purchase or payment for the consumer, since he or she already trusts Facebook, and since, critically, no additional app is necessary. In contrast, Venmo is obviously less well-known than Facebook, and PayPal – despite its name recognition – still requires a new account. And both services require an additional app. By piggybacking on its Messenger platform, Facebook has managed to effortlessly opt into its users devices, without more than an update. Additionally, Facebook payments will utilize its customers’ debit – not credit – cards, which will permit lower costs per transaction.

And ultimately, anything that allows my friends to more easily send me Starbucks giftcards on my birthday is just fine by me.

Facebook Messenger, Now with Payments

Pricing The New Macbook

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The new Macbook took me by surprise: I didn’t expect it to come back, or at least not in its current incarnation. More specifically, I expected it to replace the Macbook Air on the lighter (and cheaper) end of Apple’s computer offerings. But given its $1,299 price tag, I think Apple will hold off for a year or two before merging the new Macbook and old Macbook Air lines. Two few reasons why:

1. I think $1,299 is probably about the cheapest it can sell the new Macbook, since the production lines are just ramping up, and Apple hasn’t yet achieved economy of scale.

2. This pricing preserves the more budget ($999) nature of the MacBook Air, and the for-now premium (but eroding) $1,299 price-tag on the Retina Macbook Pro. I think this pricing strategy will press most users to either the lower end of the new Macbook, or the higher end of the 15″ ($1,999) Macbook Pro with Retina.

I think that in 2016, Apple will simply merge the old Macbook Air and new Macbook lines, and bring down the price to the $1,000-range:

a. To preserve its two-laptop/two-desktop dichotomy, and keep its product levels simple.

b. For pure marketing reasons, I think Apple will remove the “Air” suffix, so as to suggest that  the extreme thinness and lightness of the new Macbook is now the standard – no qualifier needed.

Pricing The New Macbook

Shot on iPhone

Apple is running much-heralded ad campaign, showcasing the iPhone 6’s powerful camera in advance of the release of its new Photos app. This campaign fits with Apple’s larger advertising motif of demonstrating not so much its products, but what you can do with its products:

Contrast this with the Android’s advertising equivalent of “speeds and feeds” — basically a technical gloss of the new Nexus’s megapixel count and screen resolution.

Shot on iPhone

Twitter Advertising Goes HoC

So, House of Cards has clearly struck a nerve in the Twitter advertising world. It’s actually a little clever.

Twitter Advertising Goes HoC

The Three-Shot Espresso

Two weeks ago, Starbucks announced that it would implement a monthly subscription plan for its newly-introduced high-end line of coffees. This comes on the heels of the coffee giant announcing the opening of its coffee mega-mecca, the Roastery, in Seattle, providing a destination for coffee worshippers to come, pray, and purchase at the origin of, well, origin coffee. The implementation of a subscription program, and the generation of a coffee destination, seem part of a larger effort to combat encroachment on Starbuck’s territory by both niche coffeehouses, as well as high-end coffee delivery services. Starbucks is, like its corollaries in beer space, chasing the “craft crowd,” and it’s compelling to see the ways in which it’s innovating.

1. The subscription model: Starbucks obviously faces competition in the subscription space from firms like Craft Coffee and Tonx, among a million others. These subscription coffee firms offer the best of the rarified coffee-drinking experience – single origin, shade-grown beans – delivered to your doorstep at intervals of your choosing. Starbucks may yet have an advantage in drinkers’ homes, since it can dilute its coffee purity a little by offering K-Cups and Via packets in addition to beans – something its high-end rivals would sniff at.

2. The destination model: Starbucks has a lot of stores, and therefore doesn’t have the same destination appeal as small retailers like Blue Bottle or Stumptown. In response to the commoditization of blonde wood, hanging lamps, and Norah Jones CDs, Starbucks has undertaken an effort to redo many of its stores to fit with local tastes and aesthetics.

3. The mecca model: A variation on the destination model, the construction of the Roastery takes a page from the craft beer movement, with Starbucks flinging open the doors of its roasting facility to offer a behind-the-scenes look at the craft behind the coffee.

I don’t think that the Roastery will actually generate enough revenue to cover its costs, but I do think that it will provide a sort of halo effect that, coupled with the introduction of limited-run coffee blends (both in-store and by subscription), will help move the Starbucks brand upmarket while still defending the mid-tier end from encroachment by trendier, healthier options from Dunkin’ Donuts and McDonald’s. It’s certainly an effort worth watching. Pass the half-n-half.

The Three-Shot Espresso