insights! episode #6: the Benjamin button effect

Today it's about the Benjamin Button effect, and that's the fifth of eight top elements that the GAFAs do better than many other companies.

But what is the Benjamin Button effect?

Benjamin Button is a ten/fifteen-year-old film about a person who was born old and became younger and younger, eventually dying as a baby. That's a symbol of the fact that products, once released, age and immediately lose value. We see this with vehicles - immediate loss of value after first registration. Buy a PC - lose value a month later.

Television also good example, every year new models appear, old ones then much cheaper. There too, value loss happen straight away. But superproducts from these GAFAs manage to become more valuable after release.

How do they manage that?

On one hand, they connect – meaning every new user of these products, these services, adds value. Simply put, Google, Facebook, Amazon and co play that brilliantly.

Take Facebook: every additional user grows the network and the chance that I, as a user, can connect. And the more I can connect, the more valuable it becomes for me as a user, and the more valuable it becomes for Facebook. Advertising on it naturally gets much better the more people are on it. And advertising now, with the AI components, with the digital twins, gets even better the more people I can evaluate accordingly there.

There we see, if we manage to generate these products in such a way that new users, new usage, make it more valuable, it's a product that has the Benjamin Button effect.

As a service company, we acquired a start-up, namely brytes. Brytes is a personalisation engine that, based on digital empathy – body language, how I move around the website – works out where this one session, this one person, currently stands.

Does she want to buy something? Is she unsure? Does she not yet know what to buy? Is she unsure about the company or about the shop itself?

The more customers we get onto this platform, the more different customers come on board, the better we can evaluate and understand it. And also understand the users of this platform, i.e. the customers of our customers. If we understand them better, we can also interact with them better again. If I know an employee or user doesn't know how to do the check-out, or is struggling because of a technical problem, or is in our price comparison, or looks at 60 products and keeps hopping back and forth in the same segment, then I can play out the next step very, very well.

Especially in moments like when I'm searching for something, can't find it, and scroll endlessly, I can use his behaviour to tell him, use the filter, use the chat, maybe it's just sorted differently – and then guide him to the right result. This example is simply meant to show: if I manage to create a product that becomes more valuable with more usage, with more customers, then I've got the Benjamin Button effect. And then I've also got a product on the rise that, after its successful birth, becomes far, far more successful the more it's used. That's what you should strive for.

You should check whether there are ways to build that in exactly like that.

That's the fifth tip on why the GAFAs manage to get significantly further ahead here and combine the mix of growth and margin to increase both together.

Combined with verticalisation, that's the sixth point. And that will take you to a whole new level. Verticalisation follows next week on Insights.

Thanks for listening, look forward to next episode!

Have a nice day or evening. You can subscribe to this podcast on all common channels.

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