Tag Archives: Marico

Hyperbusiness Opportunity #1

On a recent trip to Singapore with my friend Nicola, I poked through an iPhone app named ‘ieat Hawker’, named after the famed ‘hawker’ food halls that dot the city-state. Nicola wanted to sample Char Kway Teow – a delicious Chinese fried noodle dish – at one of the hawker centers. I went through the list provided by my app, diligently checking its location on the map with our location. Each of them involved a hefty trek in a taxi or on the subway – and we were too hot, humid and hungry to embark on that kind of quest.

In a moment of exasperation, Nicola asked me, “Why can’t I tell my phone that I want some good Char Kway Teow – and then have it tell me when I’m near a hawker who can cook some up for me?” And indeed, location-based apps like Foursquare should work this way – you should be able to advertise your interest in something, and let the app find it for you. Instead, the apps work the other way around – they advertise to you all sorts of things that you’re never interested in, which is why none of them have been very successful for businesses.

Now that the market is everywhere, hyperbusinesses listen to what the market wants. Every individual can now advertise their needs in a way that allows the hyperbusiness to offer just what any individual needs, just when they need it.

The model of advertising that grew up in the era of mass media (even all the way to Google) has been turned inside-out by the presence of the pervasive market. Now we each advertise our needs as consumers, and businesses offer to fulfil those needs. This is just what Marico does when it sends its daily text message to coconut pickers. It’s vastly more efficient than a shotgun approach – or even targeted advertising, because rather than trying to gin up demand, a business is always satisfying an advertised need.

Markets Are Everywhere…

photo: v1ctor

Coconuts can be good business. In the southern Indian state of Kerala, families have planted coconut trees for countless generations, always keeping a close watch on them — as coconuts fall from ten meters high, they become dangerous projectiles. At some point someone decides something must be done, and someone gets dispatched to find the coconut picker. A village might have a few coconut pickers – wiry men with good balance who can scale the heights, snip the branch, and catch the coconut before it falls – but pickers can be very hard to reach. A good coconut picker will be up in the trees most of the day. Since he depends on customers coming to him, he has to hope his customers hear through the village grapevine who’s tree he’s climbing that day.

One day, in one village somewhere in Kerala, one of the coconut pickers bought a mobile. This wasn’t particularly unusual – India has nearly a billion mobile subscriptions – but it led to something completely unexpected. Now that his customers could reach him all the time – mobile reception is particularly good at the top of a coconut palm – he got a lot more work. Within a few days all of the other coconut pickers in the village were going wanting for work, because it was just too easy to make a call to the picker with a mobile, and too hard to search through the village looking for any of his competitors.

In a case of adapt-or-starve, within a few days all of the other coconut pickers in that village had their own mobiles. Now villagers could reach any of the pickers at any time, arrange a mutually convenient time for the picking, perhaps even engage in a little friendly negotiation – when your competitors are no more than a few digits away, your customers are more likely to shop around.

Now that almost everyone, everywhere has a mobile, everyone, everywhere is able to trade anywhere, at any time. The market has always been a place and time where people came together to do business. The mobile has made taken the market and amplified it, made it pervasive and ubiquitous. You don’t have to install a market app onto your smartphone, because we are the market makers. Teach a man to fish, and you’ve fed him for the rest of his life. Sell someone a mobile, and you’ve turned them into an entrepreneur.

Once a whole nation has mobiles, and everyone can do business, all sorts of businesses become possible.

In present-day India there’s a shortage of coconut pickers – the job lacks prestige, and a new generation of better-educated Keralans prefer to find their opportunities closer to the ground. But the demand for coconuts has continued to grow. Marico, an Indian manufacturer of health and beauty products, struggled to source a supply of coconuts – either they had to deal with unreliable middlemen, or establish relationships with hundreds of thousands of individual pickers. Neither alternative gave the company any sense of security regarding its supply chain.

Marico asked coconut pickers to register their mobile numbers with them; in return, each morning Marico sends those pickers a text message with the price it’s willing to pay for coconuts, and the pickers decide for themselves whether it’s in their financial interest to fulfill Marico’s order. Working directly with the pickers, Marico modulates the supply of coconuts harvested to meet its demand with small variations price it offers pickers. No middlemen, no supply chain headaches, and no infrastructure – Marico treats each picker as an entrepreneur, and everything else just happens, almost magically.

This capacity for self-organization is one of the benefits of pervasive markets. Marico advertises its need to the people capable of meeting that need, and the web of communication and connections does the rest. It’s an ‘invisible hand’, of sorts, hard to distort or disrupt, and easy to duplicate. Marico’s competitors for coconuts will need to make sure they get the numbers of those pickers, so they can make their own offer – on some days, a competitor would want to wait until after Marico’s sent their offer out, so they could better it. On other days, you might see price wars breaking out, as the competitors overbid each other into a market bubble, or price collapses, as competitors underbid one another in a search for the bottom. After such a collapse, you might even see a network of pickers band together in a syndicate, setting their prices and establishing long-term production contracts with coconut-consuming businesses. All of this is now possible – even easy – because markets are everywhere, even in the tops of trees.