Instructor

This CNET article discusses how Instagram is testing a checkout option that lets users purchase products without leaving the app. The article also mentions that this is one step in Instagram’s plan of “long term investment in shopping.”

This feature is a great new revenue stream for Instagram, as they will certainly get a cut of any sales made in the app. It also is a great complement to a lot of the most popular content on the platform. Instagram is dominated by public figures and “Instagram celebrities” who use the app to build their brand. For all these people who are promoting products and doing ads on their page, it means their followers are even more likely to buy.

The payments will be processed through a partnership with Paypal and the user’s payment information will be stored within Instagram, which could be a point of tension, since Instagram is owned by Facebook. This development will likely lead to an increase in targeted ads on the app as well as an increase in companies using this new sales portal.

Do you think this change will improve the user’s experience by allowing them to check out even easier? Or do you think they will become overwhelmed with the influx of ads on the app?

– Drew Holt

In the New Yorker article “The Disruption Machine: What the Gospel of Innovation Gets Wrong,” Jill Lepore describes the flaws in Christensen’s theories on disruptive innovation. She cites his selective sampling, where incumbents’ successes and disrupters’ failures are ignored in favor of examples where incumbents were toppled by new entrants who disrupted the market. 

Lepore uses Toronto Dominion bank’s success during the financial crisis. She describes the subprime mortgages and mortgage-backed securities that caused the eventual financial crisis as disruptive innovation. More people were getting homes, and banks and bankers were making more money, but TD bank, a relatively small foreign company new to the US market, decided to ignore the innovative new strategies and continued its core business. According to Christensen, this should have resulted in TD’s failure at least in the US market where most major banks quickly adopted these now-infamous policies. Instead, while the majority of American banks were reeling from the market collapse and recession, TD was still growing and was able to acquire competitors like Commerce Bank to expand its presence. Today, TD is the 8th biggest bank in the US. 

As soon as Lepore mentioned the financial services in her article, I knew where it was going. Last summer I had the privilege of interning with TD bank, and on the first day of orientation, CEO Greg Braca spoke to us about who TD is as a company. He emphasized that TD is a value driven bank, and specifically explained that subprime mortgages and risky lending didn’t fit the company’s values. The bank could have pursued the profits that those practices promised, but instead doubled down on their core offering: convenient, customer-focused banking. He wanted to stress that the bank’s current success was owed to that decision not to pursue a seemingly industry-disrupting practice. Disruptive innovation isn’t always good, and it isn’t a theory that can be applied to the future. There is too much uncertainty for a theory based on historical data, especially when based on a small, biased sample of said data, to be applied looking into the future. As Lepore says, disruptive innovation is a theory that can explain why a business failed in the past, but not much more. 

 

Source: https://www.newyorker.com/magazine/2014/06/23/the-disruption-machine

Mojahed Ibrahim

Companies are coming to realize, slowly but surely, the importance of data and analytics. One of these companies GE has recently become more active in using data correctly. In the article GE’S BIG BET ON DATA AND ANALYTICS it states “The company is putting sensors on gas turbines, jet engines, and other machines; connecting them to the cloud; and analyzing the resulting flow of data. The goal: identify ways to improve machine productivity and reliability.” Stating to us that even an industrial company so huge has started to implement the possibilities that data and analytics open for you. Personally I believe that this is important to realize, that even companies in different industries are realizing the use cases and benefits of technology, data, analytics, and etc. Data is defined as “a collection of facts (numbers, words, measurements, observations, etc) that has been translated into a form that computers can process” showing us the importance that as technology grows the more accurate data we can provide for it them more tech can continue to grow and help us succeed.  These companies such as GE betting on data are learning that using data has efficiently helped them succeed and have made it the way of their future. In the article it states “‘GE has made significant investment in the Industrial Internet,’ says Matthias Heilmann, Chief Digital Officer of GE Oil & Gas Digital Solutions. ‘It signals this is real, this is our future.'”. Correctly using data is not only GE’s future but should be regarded as our future as a whole.

Sources

https://sloanreview.mit.edu/case-study/ge-big-bet-on-data-and-analytics/

https://www.import.io/post/what-is-data-and-why-is-it-important/

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