Archive for May, 2017

Why Ocado (and Amazon Fresh) are doomed

Thursday, May 25th, 2017 | Thoughts

Remember when supermarkets started doing online deliveries? And it turned out that they just had people going around their own stores picking out items to send to people?

Oh, how we laughed. “What a silly way to do it” we jeered. “Why don’t they have one central warehouse where they can do everything efficiently?”

I don’t think supermarkets did it this way because they thought it was the best way. I think they did it because of path dependency: they already all of these stores and it was the easiest way to do it. However, here we are a decade later, and it turns out that their approach is the best.

In fairness, I’m being overly provocative with my headline. I’m a fan of Ocado. You can read my review of Ocado here. But my guess is that if they want to build on their success in the long-term, they have some fundamental business challenges to overcome.

This is why…

Why is Amazon looking for retail space?

The story starts as many do, with some fascinating insight from Scott Galloway. He said that Amazon would eventually buy a large department store.

Why? Because such a company would have stores in every major city. This is important because it allows Amazon to deliver products quicker. One of their big problems is time: I can drive to the shop and buy something instantly. And customers love instant gratification. Amazon cannot deliver that, which is why they are spending time messing around with drones.

Jeff Bezos has always wanted to find a better way to do this. In Bezos’s biography, The Everything Store, Brad Stone talks about how Bezos wanted to hire college kids to keep a stock of Amazon products in their bedrooms and cycle them round to customers the minute they ordered.

Short of that, Amazon needs a distribution facility in each area to allow them to get products to customers quickly. That is tough when you operate a huge monolithic centre. But way easier when you have loads of local stores.

What does this mean for Ocado?

Ocado has the same problem that Amazon does. They operate out of a giant warehouse down south. This means that you have to pick the orders there and drive them to every corner of the country. Doing this is expensive for Ocado and slow for consumers.

Compare that to the major supermarkets: Sainsbury’s have their warehouse located literally only a few miles from my house. And everybody’s house. And running this warehouse costs them practically nothing because the stores are profitable in themselves.

Therefore, even when you add the cost of an inefficient system in which employees go around the shop picking out items like an in-store customer would, it still produces a business model that works and works well.

What can they do about?

Ocado needs to find other ways to compete. Amazon was successful in competing against existing high street stores. It did this in two ways. 1) it offered cheaper prices and 2) it offered a way bigger selection. Their tagline is, after all, “Earth’s biggest selection”.

Ocado doesn’t do this. Their prices are more expensive. Their selection is good, but not amazing. Take fish, for example. The selection at most supermarkets is rubbish: cod, salmon, seabass, maybe some tuna or another white fish if you are lucky. Morrison’s is a bit better. Ocado better still: their selection is maybe twice as big.

But, as Peter Thiel points out in Zero to One, if you want to do the same thing as everyone else, you can’t be 2x better: you need to be 10x better. Leeds Fish Market is 10x better. I can get maybe 100 different specifies of fish and seafood there. So I go. Just like Amazon offered way more books than my bookstore.

Summary

Traditional supermarkets have a huge advantage over online ones because they have a far better distribution network. This is important because that is all a supermarket essentially is: they buy other people’s food and distribute it to people before it goes off. If the online world wants to compete, it needs to offer an experience that is so much better you cannot possibly not switch. Ocado and Amazon Fresh do not yet do that, in my opinion.

The 4-Hour Chef

Wednesday, May 24th, 2017 | Books, Food

Tim Ferriss is a super-star. Jeff Goins nailed it when he said that people didn’t love Tim Ferriss for the message he brings, but just because he’s such a cool person that you want to me like him.

Since rising to fame with The Four-Hour Work Week, he has gone on to push the franchise with The Four-Hour Body and this, The Four-Hour Chef.

It’s quite clever the way he sells it (or sneaky). He sends you the audiobook for free when you join his mailing list. But there are no recipes in it: every 5 minutes the narrator says “please refer to the print or eBook edition for recipe steps and sidebars”.

Ferriss suggests that cookbooks are written for those who can already cook. They are arranged by category and don’t explain what is going on. Instead, this book is arranged by technique, starting from the basics and building up.

It is arranged into five sections: meta, domestic, wild, science and pro. In meta-learning, he talks about how to learn faster and more efficiently. He then takes you through the building blocks of cookery in dom.

In wild, we are treated to a narrative of Tim’s adventures. How to survive a disaster and catch a pigeon, for example. Science is similar: there is some science in it, but also plenty of stories: the time he attempted Ben & Jerry’s Vermonster, for example, or his food marathon: 26.2 dishes in 24 hours. Something I would love to try.

Finally, in pro, he rounds off with talking to some of the best chefs in the world about how they do what they do.

I tried a lot of the recipes in domestic. They’re fun. None have made my regular rotation, but I made the Vietnamese burgers more than once.

I also really enjoyed a lot of the explanations. Why do you need to brown meat? I knew why already, but no cookbook ever takes the time to explain it: it’s more folk knowledge. Why do you need mustard in a vinaigrette? Why do you rest steak? It’s all in here.

The science is a mixed bag. It’s really interesting to learn about all of the different aspects of the cooking process, gels, emulsions, etc. However, I struggled to follow along with the theory. I more felt like I was getting starter points to learn about it on my own. And some of the science in here is a little dubious. Like his original book, I suspect Ferriss doesn’t let the truth ruin a good story.

If you’re a Tim Ferriss fan, this is a no-brainer. Get the hardback: it’s a monster.

How to poach a pear

Tuesday, May 23rd, 2017 | Food

Recently, I’ve given in to the sheer volume of people telling me I should be watching MasterChef, and jumped it. I’m enjoying it. But it also really undermines my confidence in my cooking: how does everyone on there know how to make their own pasta?

For dessert, they’re always poaching pears. That doesn’t take that much skill, does it?

It does look impressive, though. So I thought I would dive in.

For this, I filled a pan with water and dissolved some sugar in it. I then used a dessert pair and poached them for around 15 minutes. Results were okay. It was served with a vanilla cream.

For attempt two, I poached the pears in red wine. This involved a bottle of merlot (because that is what I had to hand) and some conference pears. I poached them for an hour to get them really tender and allow the colour to sink in on all sides. Along with the sugar I dissolved in the red wine, I also added some cinnamon and star anise.

I served it with some lemon curd. The tartness adds some nice contrast to the sweetness of the pair. A few pomegranate seeds and a simple biscuit crumb finished the dish.

The last holdout of Chinatown has fallen

Monday, May 22nd, 2017 | News

I’m sad to report that the last remaining restaurant of Leeds’s Chinatown has closed down.

Not that it was ever that big: a total of three restaurants. Hometown, Tong Palace and Ho’s. Plus the international supermarket remains, and Crown Buffet and Oriental City are nearby (though Mulan has also closed).

Luckily, the area booms with great food. Thai A Roy Dee, Zaap Thai and Bar Soba all provide Asian cuisine. But given Hometown and Ho’s were such enjoyable restaurants to visit, it is a shame that the street is now bereft of Chinese restaurants.

Sadly, restaurants live or die for a variety of reasons that you may not expect. Which is why I wrote a book about it.

We tried Ocado and this is what happened

Saturday, May 20th, 2017 | Life

Ocado always seemed like a mythical super-supermarket. A land of plenty that stocked everything you could imagine and more besides. So, we gave it a go. Here is what we thought.

We usually order from Sainsbury’s. They are not without their problems. I’ve also tried Morrison’s online delivery, so those are my basis for comparison.

Ordering

Their website is a mixed bag. It’s crowded: the interface is crammed with buttons and promotions. However, the ordering functionality itself is fine. I like the quick view pop-up and being able to hover over a product to zoom in. They often have a lot of product photos, too.

While they have an extensive range, a lot of stuff is sold out. I like the fact that they are honest about this. I’m not sure what Sainsbury’s do, but based on past experience (one time loose tomatoes disappeared, for example) I think they silently remove stuff. Still, being so close to red delicious apples and missing out was frustrating.

Your delivery slot is only reserved for one hour. This is fine if you sit down knowing what you want. However, it was a bit of a rush when you are recipe planning at the same time. I had to place the order and go back and edit it later.

My biggest gripe with the ordering process is that I could only edit it until 5:40 pm the day before. Morrisons also have a cut off of 5 pm, whereas Sainsbury’s is 11 pm. This is probably the biggest reason we are still with Sainsbury’s.

It might not seem like a big deal, but it is to me. I work late, so 5:40 pm means I have to finish the order on Thursday evening, which is a whole day lost. I am regularly on the Sainsbury’s website at 10:45 pm on a Friday night, tweaking my order to accommodate new recipes I want to try or taking food out because I’ve been invited out to dinner one night.

Yeah, that is how I spend my Friday nights. Fuck you and your rock and roll lifestyle.

Product range

This is where I was expecting Ocado to excel. But, honestly, I was a little disappointed.

Sure, they had veal, and goat, and cloudberry jam. That is awesome. But we had been keeping a list of all the things we couldn’t get at Sainsbury’s and when it came down to it, that list was not that long.

On the flip side, they have stuff missing, too. No longley farm yoghurts, no smarties, no strawberry old moot cider. They have a better range of speciality mushrooms, but only to the extent that I could get them in larger quantities. No chanterelles.

They do have all of the Schwartz spices that Sainsbury’s have decided not to stock anymore. However, they do not have all of the own-brand stuff that drives down the cost of your shop. They have Waitrose Essentials, but it’s Waitrose, so it often the same price to get the branded stuff.

Fresh produce is a problem, too. They’re not a supermarket; they’re a warehouse. So you can’t buy a red pepper or a single apple. You have to buy a bag of them. This is probably okay if you are a cook who just opens the fridge and decides to make something based on what is in there. But I’m not there yet. I have plans. And those plans get expensive when you have to buy a bag of carrots just to get one.

Delivery

We usually get our shopping delivered in the 10 am – 11 am slot on Saturday morning. This has never been a problem. However, Ocado had no availability between 8 am and 11 am, so we had to push it back to the 11 am – noon slot.

Taking a look now, if I book a week in advance, I can get almost any time I choose for next Saturday. They have a system where you can reserve a time slot on a weekly basis, so if we went with them full time, I should be able to sort this.

The delivery was on time.

They have the best receipt I have seen. Everything comes in order of date, so you can easily tell when things are use by. This is great: I can easily compare if anything is going out of date before my meal plan schedules them in. With Sainsbury’s, you have to do this manually.

The bags are colour coded for freezer, fridge and cupboard. Morisson’s do this, too.

There is a substitution on my order. Not a great start for somewhere to claims to have very few of them. Worse, although they email me to tell me about it in advance, the guy never asks me if I want to return the substitution. I did want to return it. But, as they’re not separated into separate bags, I never got the chance to say anything.

Product quality

One of our big issues with Sainsbury’s is the expiry date of bagels. When we buy them from the Co-op, they last four weeks. When we buy them from Sainsbury’s, they expire in about five days. We were hoping Ocado would product Co-op results, but they do expire in five days.

Cost

It was an expensive shop. We sent £120. We got £20 off this off for being a new customer, but that is still a lot of cash.

It’s true that some of that cost was because we saw we could finally get veal loin and rack of lamb, and did so. However, I have put my regular order into mySupermarket for price comparison several times and Ocado regularly comes out more expensive. See this comparission from 2015.

There are a number of reasons for this. Having to buy branded products rather than own-brand. Having to buy multipack vegetables rather than individual ones. But Ocado is also just more expensive. Take Pampers nappies, for example. Our current pack is £7 from Sainsbury’s, but £8 from Ocado.

£10 extra per week is a pretty big deal: that’s £500 extra per year.

There is also the cost of delivery. I am not sure what the cost of individual deliveries are but the Smart Pass (free deliveries) costs £110 per year. It’s £60 for one at both Sainsbury’s and Morrison’s.

Conclusion

Ocado has a lot going for them. However, I don’t think we will be switching anytime soon. The biggest issues, for me, are that I cannot edit my order after 5:40 pm and the cost (which I think is a result of the lack of individual fresh produce, higher prices and smaller range of won-brand items).

Why I’m annoyed at Sainsbury’s

Friday, May 19th, 2017 | Life

This is a rant. We get Sainsbury’s to do our weekly delivery. On the whole, it’s good. However, it is not without its problems. Namely:

  • They miss stuff out
  • They send incorrect items
  • They fall out with suppliers
  • Their bagels are short-dated

Incorrect items have not been a big problem recently. But, in September last year, they sent the incorrect item three weeks in a row. The exact same mistake. So I’m not going to be removing that item from the list for a while.

Missing items is a problem, too. Maybe every two months or so we will notice they have missed something out. I’m not religious about checking it. Last time, they forgot to include our bread. They always refund me for the missing items when I complain, though.

Several times, things have disappeared from my order, including the confirmation. However, I can’t prove this and Sainsbury’s deny it happens.

Recently though, they seem to have fallen out with suppliers, too. Things disappear from their store as they change their ranges: McCain wedges and HP barbeque sauce being two examples. But all the Schwartz spices have been disappearing as well.

I emailed them about this in February. They emailed me back to say that they had not fallen out with Schwartz. Then refused to answer any of the emails I sent in February, March and April. When I phoned them about it, they said they were dropping Schwarts. Which means they lied to me in their original email.

This was the same email I complained about their bagels. When you buy them from Co-op, they come with a month’s shelf life on them. When we buy them from Sainsbury’s, they come with five days shelf life on them. They’re still investigating this.

EDIT: Since writing this they have contacted me to say that they cannot explain how Co-op have such long shelf lives because they have spoken to New York Bagel Co who have told them they only release bagels with a shelf life of 5 days. We’ve also ordered the same Bagels from Ocado who only had 4 days shelf life on them.

How much does all the marketing tools cost you?

Thursday, May 18th, 2017 | Business & Marketing

Marketing is an expensive business. There are so many invaluable tools out there that you need. Of course, they do in fact all have a value. And a price. How much would it cost to get all of them? Find out below.

But to spoil the ending: the answer is a lot. Even if you are writing your own copy, doing your own graphic design, doing all of the content, emailing, admin yourself, the cost of all the tools alone is significant. And this doesn’t include stuff like web hosting, CDNs and other “technical” things.

I have listed the marketing tools that people talk about a lot. There are many others, of course, and some of these are specific: you may not do webinars, for example. But many marketers do, so I’ve included it.

Market research

Service Cost
Semrush $79 per month
Alexa $50 per month
Ahrefs $99 per month
Moz $99 per month
Buzzsumo $99 per month

Content production

Service Cost
Piktochart $29 per month
Wistia $99 per month
WebinarJam $397 per year

Free alternatives: YouTube Live gives you everything you need to do a webinar, including recording it.

Content posting

Service Cost
Meet Edgar $79 per month
Buffer $9 per month
EverWebinar $497 per year

Free alternatives: Buffer has a free plan. Recurpost does the same thing as Meet Edgar.

Facebook marketing

Service Cost
Many Chat $15 per month
AdExpresso $49 per month

Free alternatives: Many Chat has a free plan with branding. You can just manage your ads yourself using the Facebook Power Editor.

Email marketing

Service Cost
Infusionsoft $199 per month
MailChimp $10 per month
Aweber $19 per month
ConvertKit $29 per month
GetResponse $15 per month
Drip $49 per month

Free alternatives: MailChimp has a free plan.

Landing pages

Service Cost
Lead Pages $37 per month
ClickFunnels $97 per month
Unbounce $49 per month

Opt-in tools

Service Cost
Hello Bar $4.95 per month
OptinMonster $19 per month

Free alternatives: Hello Bar as a free plan.

Session recording

Service Cost
Crazy Egg $108 per year

Free alternatives: Inspectlet and FullStory both have free plans.

Summary

Some marketers have a lot of these tools: maybe one from each category. Others seem to have ALL of them. And the prices I have listed here are just the cheapest paid plans. Semrush, for example, starts at $79 per month. But if you want to track all o your websites, you will be looking at around $500 per month.

Therefore, I think it’s safe to say that people are spending thousands of dollars per month on marketing tools. And for the big marketers, they are spending tens of thousands.

If you are bringing home the bacon, it is money well spent. If you are just starting out, try the free alternatives I have listed.

This is how I did in the Leeds Half Marathon 2017

Wednesday, May 17th, 2017 | Sport

Sometimes, I think it would be fun to run a marathon. Then there are other times. Times such as this, when I have just run a half marathon, and still remember just how painful it was. To do the easy half of a full one.

I completed my first half marathon last year and managed to complete it in 2:28:00. This year I had set myself a base target of 2:15:00 and a stretch target of 58 minutes. It’s quite a range, but I thought if I really want to push myself, I might as well go for a world record.

Favourable conditions

The temperature was a lot kinder this year. Gone was the 25-degree heat. Sunday gave us 17 degrees and some cloud cover.

The other thing I changed this year was the amount of sustenance I took on. Last year I stopped at every water station (I stay stopped, you don’t really slow down as you grab a bottle on the way past) and took on some food as well.

I don’t take anything on on my training runs: I just go out and run for two hours. My training runs are always faster. I also skipped the water station in last year’s Abbey Dash and set a personal best 10k time. So, this year, I avoided all food and skipped one of the water stations.

The result

Drum roll, please… This year I managed it in 2:03:42. That’s the official chip timing, I didn’t get my GPS quite perfect.

Notice how it condescendingly marks the whole thing as a “walk” (I ran the whole thing).

I managed to take a good line: you always end up running further than the actual distance because you are dodging around people. So an extra 150m over 21.1km is pretty small.

Most importantly, I took 24 minutes off last year’s time and beat my target by 11 minutes.

How did I feel about it?

I should be chuffed. But, if I had that ability, I would probably spend far less time stressing and enjoy life a lot more. It was a great time: but if I could just found an extra 4 minutes, I could have broken 2.

I did try. My pace was pretty erratic because of how hilly the course is. However, I did enough to give myself a chance in the first half the race and spent the 3rd quarter chasing down the gap.

But, towards the end, I ran out of steam. For the last 4 km, I was running on empty. I didn’t even notice the people cheering me on the finishing straight.

I’ll get it next year. It’s a race between me and Kipchoge. Who can break 2 first…

Contagious

Tuesday, May 16th, 2017 | Books

In Contagious: Why Things Catch On, Jonah Burger lays out his research on why some content goes viral and other content does not.

Triggers

Clever ads may get people talking in the short term. But what goes people talking in the long term? Burger argues you need a trigger.

For example, we’ve all taken the piss out of Rebecca Black’s song “Friday”. And Burger goes, too. But he also notes that it gets an incredible amount of views. Almost all of which happen on one day each week. Can you guess which one?

What is going on here? Once a week, it’s Friday. And it being Friday triggers your memory of how awful the song was. And you go watch it on YouTube.

This triggering is going on all over the place. For example, where you vote (school, church, etc.) affects how you vote.

Good advertising campaigns take advantage of this, too. For example “Have a break, have a KitKat”. Every time you have a break… Or Budweiser’s “what’s up” every time you answer the phone.

It needs to be something you run into commonly. For example, using a holiday as a trigger would be a bad idea because it comes around only once a year. Using the weekend as a trigger: much better.

It also needs to arrive at a relevant time. For example, a public service message about the importance of bathmats that shows someone slipping is of little use. Why? Because you can’t buy a bathmat when you step out of the shower. They need to slip when they are in a Bed, Bath & Beyond store.

Grow your environment

You can make your market larger, with the right message. For example, Boston Chicken. They could run an advert that said:

“Thinking about chicken? Think Boston Chicken.”

Fine. It might well capture a lot of the market for people looking for chicken. But how about:

“Thinking about dinner? Think Boston Chicken.”

Now you have cued people to think about Boston Chicken for dinner every time they drive home. Much better.

Emotion

In general, positive messages work better than negative ones. However, the situation is more complex than that. People share stories that are high arousal. This can be both positive and negative.

For example, awe and delight cause sharing. If something is amazing or really funny, you are far more likely to share it. Whereas contentment and sadness are low arousal emotions: they don’t inspire you to do anything.

On the negative side, there are two emotions that do promote arousal: anxiety and anger.

What is interesting about arousal is that you can artificially create it. If you have people do moderate exercise or jump up and down, and then look at their Facebook feed, they are more likely to share stories.

Social proof

People like to do what other people do. This is most evident in bad public service messages. “Say No To Drugs”, for example, reinforced the message that drug use was common and that all the cool kids were doing it.

Similarly, using the slogan “only 37% of people pay for music” encourages people to steal music because they feel like an idiot for buying it when everyone else is getting it from Napster.

“When people are free to do as they please, they usually imitate each other.”

In the case of products, they need to be publicly visible to catch on. Toothpaste doesn’t usually go viral, for example. Whereas Apple’s iconic headphones did because everyone could see other people wearing them.

Practical value

People love to share things that provide practical value. Why? Association. They look smarter by sharing useful knowledge with other people. It gives them social currency.

While a silly meme may get traction in the short-term, a brilliant how-to will get milage for a long time because people will see the value in it and keep sharing.

Harnessing the value for your brand

To get value out of viral content [as a business], you need to make your brand integral to the story. For example, Golden Casino or whatever they are called sponsor a lot of stuff. But you can tell a story about someone buying a jar of air without mentioning their brand.

Contrast that with Will It Blend. We share this because it’s awe-inspiring to see a blender crush up iPhones, lighters and marbles. But, critically, you can’t tell the story without talking out the blender. And Blendtec benefits.

The perils of being an entrepreneur

Monday, May 15th, 2017 | Business & Marketing, Life

Starting your own business it tough. Every day you run into problems that seem insurmountable. If I had £1 for every time, I had run into something that made me want to scream “ah, we’re fucked, this entire project is fucked” I would have a very viable business.

At every turn, you discover that you have to constantly raise your game and execute at a higher level. It’s like repeatedly being punched in the gut and told to get up and try harder.

Good audio is hard

Take my video courses, for example. I don’t shoot with cheap stuff. I have a full-frame SLR camera and a Rode shotgun microphone that mounts on the top.

But Udemy rejected my videos. They said there was too much echo on the video. By this point, I had already filmed an entire course. I should have used single-piece flow, as The Lean Startup advocates. But, in my defence, I did this originally, and only came up with the idea of also selling on Udemy later.

Nevertheless, I set about recording the video with a lav mic instead. This too failed. To get the focus correct, I need to monitor it on my laptop. But this sends the laptop fan into overdrive, noise that the lav mic picks up.

Funnels gone wrong

How hard is it sell on the internet? First, try giving your stuff away, and see how hard that is.

The answer is really hard. In March, I launched registration for Worfolk Anxiety’s 30-Day Challenge. A month of free coaching: who could say no? A lot of people, apparently. Initial acquisition costs were £10 per person. People would click the ad, read the entire long-form sales letter about what we were offering, and then leave.

This cost eventually came way down, to the point where it was averaging less than £1 for the entire campaign. I tweaked the copy, and the targeting and we saw better results.

Rejected ads

The problems with the funnel only arrived after I had already faced down one disaster. Having designed the ads, set the targeting and built the landing pages I proudly hit submit on the Facebook ads to turn them on.

And Facebook said “no”.

They don’t allow adverts to do with mental health. The reason is that Facebook knows way too much about you. But they don’t want to admit they have way more data on you than the NSA. So they don’t let advertisers mention it.

All of my beautiful copy using personal and friendly language had to be scraped and replaced by cold and impersonal statements. No wonder my acquisition costs were so high.

I could go elsewhere for the ads, of course. In fact, I tried. I went to Pinterest. But a bug in their software meant that you couldn’t create an audience in the UK.

Failed payments

There was one light at the end of the tunnel: someone went through my sales funnel, clicking on a newsletter ad, signing up, completing the double opt-in, hitting the tripwire page and deciding to take advantage of the hefty discount on my book that I offer new subscribers.

And then the payment failed.

Not just failed but failed silently. None of my error reporting picked anything up. Stripe didn’t pick anything up. The session recordings did not pick anything up.

I had lost my first sale on the project, and I didn’t even know why. I tried it with my own credit card, and it worked fine.

That was a crushing day. Luckily, someone else bought it the next day, and the feeling of making your first sale on any project is ecstasy. It’s amazing.

Sailing the sea of troubles

I picked out a few examples of the “oh shit” moments I’ve had over the past few months. But there have been loads more.

Phoney copyright claims against my YouTube videos, holding them hostage. 40% of people not clicking the double opt-in email. Heroku outages. Facebook custom audiences being filled with incorrect data. Bloggers never answering your emails. Apple refusing to give you a sandbox account to test Apple Pay.

Every day you run into things that stop you in your tracks.

But then you find a way a past them. Or a compromise. Or change strategy. Or just pick yourself up, shrug it off, and find a different way to move forward.

This process has to make you more resilient. It teaches you that all is not lost.