insights! episode #1: what do GAFA companies do well?

What do GAFA companies do so well? Today it's about GAFA companies, that's Google, Apple, Facebook and Amazon. What these firms do particularly well, you'll find out now.GAFA are Google, Apple, Facebook and Amazon. For some of us these firms are actually foundation of our existence. For others they're exact opposite. And to shed a bit of light on that, we recorded this session. GAFA, and I'd like to approach this via numbers, are gigantic. These four firms are worth as much as gross domestic product of fourth largest country in this world: India. You just need to let that sink in, these four firms are as big as India. And they've also grown massively. Question is when these four firms will be even bigger than largest country in the world. That's one thing. On other hand, these firms can grow, grow endlessly fast. They have on one hand few marginal costs and on other hand almost endless liquid funds. And that's also a bit of the problem we see here. While one or other as an Instagrammer earns money and generates advertising through that, or as marketplace trader sells products there, it's the case that other firms get squeezed so hard by their respective industry that nothing remains. We had this whole thing already almost a hundred years ago, when supermarkets simply displaced small corner shops. Something similar will happen again today and tomorrow, but then across many industries. We need to be aware of this when we support these four firms, buy something there or use something. Interesting here is, why is that so? On one hand they're the Fantastic Four for one person, for another they're the Four Horsemen of the Apocalypse. All four firms do one thing particularly well, namely they put customer at centre. They know how to talk to customer. They know what customer expects and can play this keyboard perfectly. Here's a personal example with Amazon: shortly before Christmas, that's now a few years back, but still valid, the parcel still hadn't arrived. It should've been there long ago, actually I'd barely have time left to get anything new. So I called Amazon and asked, do you know where the parcel is? And they said, yes, it's at delivery warehouse of such-and-such logistics provider. But they have a problem. Wait a moment, would you be interested in us simply talking three-way? To which I said, how three-way? Yes, three-way, with relevant staff member of the logistics company. Sure, gladly, and within shortest time I had a staff member from there in the call too. And they said, yes, I could offer him something personally, namely you come by. Because we unfortunately can't go out with our lorries, since everything's so frozen over that we probably won't be able to do it for the next two days either. Brilliant! Why is that brilliant? Amazon took my concerns, my fear that parcel wouldn't arrive quickly enough, seriously. They tried to bring about a resolution, even if that meant I'd have had to drive 80 kilometres. And on other hand I understood background of the problem. In the end Amazon understood ideally how to pick me and my pain up. And that happens exactly the same way at the other firms. Facebook earns money with advertising. And how does Facebook manage to place as much advertising as possible? Sure, because I use Facebook, or Instagram.And how does Facebook manage to get me to use Facebook, Instagram? With the right push notifications. Not for nothing have they hired an army of psychologists who find out exactly when I get triggered how, when I respond to what and what not. And whatever I respond to, they of course then push much, much more often, because I then get shown advertising on Facebook. And that of course does something to us, everyone knows it, we use these media intensively in a completely omnipresent way, at work and also at home.Interesting is that these four, from my view, aren't simply the bad guys, even though businesses certainly also go under because of this, can no longer survive. But those might also be the ones who wouldn't have made it in four to six years anyway. What's special is that this customer/company interface is served so ideally. And that's something many firms in Germany still don't do well from our view. Actually not just Germany, but also in Europe and beyond. Namely those who come rather from retail, from being a brand. Those are significant changes. Ten, twelve years ago there was a conference with the Institute for Retail Research, and there it was also asked, what's one of the biggest points for coming years? I said then, click and collect, that's what omnichannel retailers in particular need to look at much more intensively. Some have done it, some do it very, very well, like Decathlon. And others call it call and collect. Experience is though, call twice, pay somewhere at the till and then collect it! So not a good process. Call twice, because taking the order over phone with my name wasn't even that easy. And that's what I'm getting at, that's core point of why some companies are successful and other companies aren't successful. That's the customer experience behind it. We need to do that, and in these sessions that will follow now, we'll go deeper into individual topics. And I'm glad you're staying with us! Thanks for listening and I wish you a nice day or evening. You can subscribe to this podcast on all common channels. Also tell your colleagues and friends about it, the bigger the community grows, the more content and discussion we can bring and create for you.