Uploaded byRishi Dean
Child care in the on-demand economy: 10 keys for building successful P2P marketplaces
The document discusses the disruption of the child care industry by leveraging on-demand economy principles akin to those used by companies like Uber. It emphasizes market dynamics, platform strategies, and the potential for creating a two-sided market in child care to enhance efficiency and trust among users. Additionally, it outlines challenges such as initial adoption and the importance of network effects for sustainability in the marketplace.
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Child care in the on-demand economy: 10 keys for building successful P2P marketplaces
- 1. Child care in theon-demand economy Current Topics in Marketing October 27, 2015 Rishi Dean Sittercity.com
- 2. Case Readings § HBRArticle: Strategies for Two-Sided Markets (Oct 2006) § Steve Schlafman (RRE Ventures): Uberification of the US Service Economy § MIT Sloan Management Review: Strategic Decisions for Multi-sided Platforms (2014)
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- 4. 1) Underlying marketdynamics
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- 6. 3) How tothink like a pirate
- 7. Class Agenda 1. Marketdynamics & case preview 2. Academic underpinnings 3. Practical frameworks 4. Case deep dive 5. Presentations & Feedback 6. Epilogue & Closing thoughts 3:05-3:15 3:15-3:30 3:30-3:45 3:45-3:55 4:15-5:15 5:15-5:30
- 8. The disruption ofthe global service economy
- 9. How many ofyou have heard of Uber?
- 10. How many ofyou have heard of Uber? …has anyone not used Uber?
- 11. Let’s rewind 4years (almost) today
- 12. Well, it wasactually more like this…
- 13. 63 countries, 300+cities Market creation vs. market share 5 years to $60-70B valuation*
- 14. Playbook for nextgeneration businesses § Collision of underlying tech trends § Integrated consumer experience § Labor force changes
- 15. Welcome to thenew, “uber” inspired economy § Mobile apps that aggregate consumer demand, then fulfill via offline services § Delivering a “closed loop”, end-to-end experience
- 16. Incumbents innovate viaincremental improvements Focus on improving existing (premium) products TIME QUALITY minimum customer need sustaining innovations
- 17. The “next bigthing”, looks like a toy at first Initially, “cheaper”, “low quality”, “just a feature”, or “unattractive market” TIME QUALITY minimum customer need sustaining innovations disruptive innovations
- 18. “Good-enough” is thetipping point Eventually reach a flashpoint where they begin eroding share– focus and depth accelerates this TIME QUALITY minimum customer need sustaining innovations disruptive innovations
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- 21. Sittercity invented theonline child care category 6MM caregivers “Demand-side” subscription model “Matchmaking” vs. “transactional” 3MM parents
- 22. …but also createda competitor in the process
- 23. …who was aboutto get bigger
- 24. Can we “uber-ify”the child care vertical? On-demand mobile services to “professionalize” the supply and to participate in the transactional market $50B annually 5MM “entrepreneurial sitters”
- 25. Marketplaces are the foundationof the internet
- 27. The internet makesmarkets efficient § Aggregate long-tail supply and demand where offline would be inefficient § Tools to seamlessly communicate § Platform-mediated payments / transactions
- 28. Dominant Offline “Create &push” B2B / B2C Dominant Online “Facilitate interactions” P2P / B2B Enables “Platform” vs. “Pipe” business models
- 29. Examples of Platformbusinesses Strategies for Two-Sided Markets, HBR ARTICLES | Thomas R. Eisenmann, Geoffrey Parker, Marshall W. Van Alstyne | Oct 1, 2006
- 30. …almost every massively successfultech business is a platform, many of those are marketplaces
- 31. And the markethas proven this § ~20 years of consumer internet § 24 public companies >$1B x 2 for acquisitions § 140+ private “unicorn” companies § 2/3 are “platform” businesses Source: James Slavet, Greylock
- 32.
- 33. 2-sided market incentives DemandSupply 1) Initial Adoption 1) Initial Adoption 2) Same- side Effects 2) Same- side Effects 3) Cross-Network Effects o Increase in liquidity Cross-side Effects o Increased liquidity Platform Strategies for Two-Sided Markets, HBR ARTICLES | Thomas R. Eisenmann, Geoffrey Parker, Marshall W. Van Alstyne | Oct 1, 2006 o Why do seekers initially adopt? Initial Adoption o Why do providers initially adopt? o How do more seekers help one another? Same-side Effects o How do more providers help one another?
- 34. Keys to building P2Pmarketplaces
- 35. I) Select anattractive industry i) Big transaction potential ii) Ripe for disruption iii) Inherent network effects
- 36. 2) Catalyze thenetwork iv) Providing instant utility v) Liquidity: finding what you need vi) Capturing commensurate value
- 37. 3) Protect &grow the platform vii) Control the customer lifecycle viii) Cost-effective expansion ix) Cultivate competitive lockout
- 38. x) Leverage emergingdynamics
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- 40. Not all marketplacesare created equally Transaction initiator § Buy-side, sell-side, hybrid Transacted Item § Product or service § Commodity or high-consideration Market scope § Horizontal vs. vertical Revenue Model § Subscription vs. transaction
- 41. Commodity Regular Low ServiceType Frequency Consideration http://rdean.me/marketplacematrix Type 1: “Uber for X” Commodity Ad-hoc LowType 2: “Long-tail commerce” Experiential Regular LowType 3: “Recurring Relationships” Experiential Ad-hoc LowType 4: “Delegation & Indulgences” Commodity Ad-hoc HighType 5: “Big-ticket commerce” Experiential Ad-hoc HighType 6: “Episodic significance” Experiential Regular HighType 7: “Trusted Advisors”
- 42. Initial Search Trust barrier Liquidity/ Supply-side curation Ongoing Management Reuse incentive Disintermediation 2 keys in platform design and management
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- 44. Describe how you(Sittercity) will disrupt the child care vertical, by leading it into the on-demand economy Provide a brief outline of the key dynamics of two-sided platforms (HBR article) you would leverage to ensure initial adoption (overcoming chicken & egg dynamics of establishing trust), and to ensure long-term sustainability through network effects (e.g. staying on platform)? ALL COMPETITION: Discuss why your offering will win, and guard against imitation from competitors (Care & UrbanSitter)? 4 1 ADOPTION: How would you help consumers overcome the initial “trust hurdle” to adopt Chime at-scale? 2 RETENTION: What tactics would you use to keep consumers using Chime, and avoid “disintermediation” – to the point where users would recruit their personal networks? 3 GROWTH: How might Sittercity “unlock” non-vetted supply, in order to scale Chime more quickly and reach new geographies, while balancing the need for quality & safety. PRODUCT: What relationship should the new “Chime” product have with the core Sittercity business line? 5
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- 47. Disrupting yourself ishard 1. Core revenue streams 2. Comfort & complacency 3. Cost of doing business 4. Controls over operations 5. Culture / lack of precedent
- 49.
- 50. What do youneed?
- 51. Choose one ofour amazing sitters…
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- 56. P2P marketplaces canreduce “economic slackness” (i.e. unemployment) § Change lives for parents and children § Provide meaningful economic opportunity and empowerment to sitters
- 57. Child care isa national problem § 71% of moms work outside the home § Only 1 in 5 U.S. kids live in a house with a married stay-at-home mom § 61% of kids 0-5 yrs are cared for by adults other than their parents
- 58. Not Affordable More or less Affordable EasilyAffordable 25% of households <5% of households Who we can serve today
- 59. Not Affordable More or less Affordable EasilyAffordable Who we can serve today
- 60. Tomorrow: “Everyone’s PrivateNanny”? More or less Affordable Easily Affordable
- 61. Current Topics inMarketing October 27, 2015 Rishi Dean Sittercity.com Child care in the on-demand economy