At The Value Engineers we like to think about Shockwaves; imaginary, yet plausible future scenarios that would have dramatic implications for businesses. This challenges brands to think critically about their current strategy and direction. The most destructive Shockwaves tend to be the ones that prevent a brand from doing business at all. But of course that rarely happens in real life.
It seems though, that sometimes life can throw up shockwaves of its own…
A few weeks ago Uber’s application for a new licence to operate in London has been rejected on the basis that the company is not “a fit and proper” operator. This means that, after a 21 day period, Uber could in theory not be allowed to operate in London at all. Specific details on this are currently unclear, although it seems their supposedly relaxed approach to passenger safety and driver vetting may be driving the decision by TFL.
It will be interesting to see how this story will evolve:
Will consumers revolt, and urge Uber to challenge the ruling as they shudder at the prospect of travelling only via the Night Tube, buses and regular black cabs?
Will new competitors sense the opportunity to move in and disrupt the world’s biggest disruptor with a better (and regulatory sound) product? Could Lyft seize this opportunity to enter the UK market with a more ethical approach?
What impact will this have on the Uber brand, already on the ropes following several internal crises?
Regardless, with Uber integrated into the lives of so many Londoners, the question on everyone’s mind must surely be this: what on earth are we all going to do that first Saturday night without Uber?
MH370 and MH17. Two flight names that have been at the heart of two disasterous events and have scarcely been out the news over the past few months. The disaster of flight MH370 put Malaysia Airlines squarely in the global spotlight, and the events of the MH17 flight over Ukraine kept it there.
Much has been said about the impact these two events have had on Malaysia Airlines- their share price has collapsed and they have suffered a significant drop in ticket sales. Although the loss of MH17 was not due to a mechanical fault but rather terrorism, the suspicion is that many business and leisure passengers will ultimately fear boarding a Malaysia Airlines flight in the future, and avoid flying with the airline completely. Regardless of the logic behind this behaviour, how does the Malaysia Airlines brand recover when consumers now have such a strongly negative association with it?
To me, they have two options: either Malaysia Airlines scraps the brand totally and reinvents itself, or they keep the brand and seek to rebuild trust and credibility in their carrier. Neither option will be easy or come cheap. Although it may initially seem simpler to reinvent an entirely new brand, the Malaysia Airlines brand is so historical, well-established and (regrettably) far too famous given recent events for it to viably disappear quietly into the ether and return under the guise of a new brand.
So it looks like they need to engage in an intensive rebuilding campaign centred around trust, safety and reassurance. It will take time and money- neither of which are in good supply if Malaysia Airlines’ financial reports are to be believed. Cost-cutting measures to fill planes is a short-term solution, but ultimately it may still prove ineffective if passengers feel they are sacrificing their safety in exchange for cheaper flights. The battle will ultimately be won through long-term brand building. Let’s hope that Malaysia Airlines will be afforded the time to convince passengers to fly with it again.
So, what to make of the news that eBay and Argos have decided to team up and offer customers the ability to order eBay goods online and collect them from an Argos store? The tie-up of these huge retailers is an exciting proposition, with both companies seeking to utilise each other’s points of strength to create a more well-rounded shopping experience. eBay will benefit from the vast network of physical Argos stores, whilst Argos will be able to leverage eBay’s expertise in online retail to boost its own online offering.
eBay are looking to humanise their shopping experience which until now has been almost completely online and offer their customers a physical point of contact when visiting an Argos store. The benefit of this is two-fold: eBay shoppers will not have to wait for their purchases to be delivered, and instead can collect them from an Argos store when convienient. This will surely be a welcome relief to those who have spent countless hours hanging around for the delivery man. Another weak point of online shopping currently is the inconvenience of returning unwanted goods. How many times have you kept something you bought just because it was too much hassle to send back and get a refund? Having a physical store will certainly make it easier to return items and for eBay to keep its customers happier.
And how will Argos benefit? The connection to the eBay brand will undoubtably add credibility to the Argos’ online offering, who themselves are operating successfully online but are traditionally seen as an offline, bricks-and-mortar retailer. The stream of eBay shoppers collecting their goods in-store will undoubtedly drive more potential customers into Argos stores too, who may previously have not considered shopping at Argos.
The key motivation of this venture for both companies stems from their competition with online behemoth Amazon. Both companies consider Amazon, albeit from slightly differing perspectives, as a serious competitor, and this joint venture could prove to be the first real challenge to Amazon’s dominance in the online space. By providing a physical point of difference and an opportunity to interact with consumers in the offline world, eBay and Argos can offer consumers a certain human interaction which Amazon currently does not. It certainly looks like in the case of the online shopping experience, two brands may well be better than one.