by Tiffani Bova
“Companies typically track”: Allen Miller, Ben Vonwiller, and Peter Weed, “Grow fast or die slow: Focusing on customer success to drive growth,” McKinsey & Company, https://www.mckinsey.com/industries/high-tech/our-insights/grow-fast-or-die-slow-focusing-on-customer-success-to-drive-growth.
In April 2017: Richard Kestenbaum, “Subscription Businesses Are Exploding with Growth,” Forbes, August 10, 2017, www.forbes.com/sites/richardkestenbaum/2017/08/10/subscription-businesses-are-exploding-with-growth/#51961b5d6678.
more than 80 percent of software vendors: Christy Pettey, “Moving to a Software Subscription Model,” Gartner.com, November 12, 2015, www.gartner.com/smarterwithgartner/moving-to-a-software-subscription-model/.
lost 77 percent of its daily active users: Cherie Hu, “Spotify’s Churn Rate and Inactive Subscribers: Should the Music Industry be Concerned?,” Billboard, March 26, 2018, www.billboard.com/articles/business/8258220/music-industry-spotify-churn-rate-inactive-subscribers.
typical U.S. wireless carrier: Dina Gerdeman, “A Smarter Way to Reduce Customer Churn,” Forbes, Leadership, November 11, 2013, www.forbes.com/sites/hbsworkingknowledge/2013/11/11/a-smarter-way-to-reduce-customer-churn/#76ee339d2c0a.
returning shoppers spend: Sarabjit Singh Baveja, Sharad Rastogi, Chris Zook, Randall S. Hancock, and Julian Chu, The Value of Online Customer Loyalty, Bain & Company/Mainspring eStrategy Brief, April 1, 2000, www.bain.com/Images/Value_online_customer_loyalty_you_capture.pdf.
companies that focus on retention: Forbes Staff, “Investing in Customer Retention Leads to Greatly Increased Market Share, Says Forbes Insights Study.”
nearly 50 percent more likely: Jason Grunberg, “A Forbes Insights Study: Linking Customer Retention with Profitable Growth,” Sailthru, September 14, 2016, www.sailthru.com/marketing-blog/a-forbes-insights-study-linking-customer-retention-with-profitable-growth.
“controlling it all the way”: Neisser, “How Spotify Curated the Ultimate Playlist for Brand Growth.”
“We don’t think of”: Daniel Frankel, “Sling TV’s Lynch: ‘We Don’t Think of People Leaving the Service as Churn,’” FierceCable.com, May 7, 2015, www.fiercecable.com/cable/sling-tv-s-lynch-we-don-t-think-people-leaving-service-as-churn.
expected to show a growth rate: “Digital Media Market Report,” Statista, April 2018, www.statista.com/study/44526/digital-media-report/.
As of January 2018: “About: What Is Spotify?,” Spotify.com, Press, n.d., https://press.spotify.com/us/about/.
triple that of Apple’s: Micah Singleton, “Spotify Now Has 140 Million Active Users,” TheVerge.com, June 15, 2017, www.theverge.com/2017/6/15/15807826/spotify-140-million-active-users.
Spotify’s churn rate among premium subscribers: Spotify Technology S.A. Registration Statement, United States Securities and Exchanges Commission, February 28, 2018, www.sec.gov.
“You never get a”: Attributed to Will Rogers. Original source unknown.
“Scaling Spotify’s support”: Patrick Haughey, How Spotify Keeps 99% of Its Customers Happy, Voxpro.com, podcast, October 14, 2017, www.voxprogroup.com/customer-experience/how-spotify-keeps-99-of-its-customers-happy/.
“Price is what you”: Benjamin Graham, as quoted by Warren Buffett, Berkshire Hathaway letter to shareholders, February 27, 2009, www.berkshirehathaway.com/letters/2008ltr.pdf.
its conversion rate is: Benjamin Brandall, “Freemium Conversion Rate: Why Spotify Destroys Dropbox by 667%,” March 29, 2016, https://www.business2community.com/digital-marketing/freemium-conversion-rate-spotify-destroys-dropbox-667-01497671#cqiZvz54UaXJkGCx.97.
help Spotify differentiate itself: Tom Turula, “Spotify Will Now Sell Listeners Makeup Products Inspired by Popular Music Artists,” Business Insider, November 13, 2017, www.businessinsider.com/spotify-to-sell-makeup-products-2017-11.
as Spotify surpasses 170 million: Anita Balakrishnan, “Spotify stock plunges after reporting earnings for the first time,” CNBC, May 2, 2018, www.cnbc.com/2018/05/02/spotify-earnings-q1-2018.html.
Controlling Churn for Spotify: Sanjeev Sularia, “iTunes, Spotify, Kindle: Reinventing How You Spend,” Brand Quarterly, December 19, 2017, www.brandquarterly.com/itunes-spotify-kindle-reinventing-spend.
Fifty-three percent of consumers: Kimberlee Morrison, “Consumers Want Personalization in Exchange for Their Data (Infographic),” Adweek, October 21, 2016, www.adweek.com/digital/consumers-want-personalization-in-exchange-for-their-data-infographic/.
Netflix was one of: Thomas Franck, “Buy Netflix Before Earnings Because Subscriber Growth Will Top Street: UBS,” CNBC, October 4, 2017, www.cnbc.com/2017/10/04/buy-netflix-before-earnings-because-subscriber-growth-will-top-street-ubs.html.
ratchet up marketing spending: Todd Spangler, “Netflix Blasts Past Q4 Subscriber-Growth Expectations, Shares Soar to All-Time High,” Variety, January 22, 2018, http://variety.com/2018/digital/news/netflix-q4-2017-earnings-stock-1202672341.
At the beginning of 2017: Marketwired, “Parks Associates: 19% of U.S. Broadband Households Cancelled an OTT Video Service in the Past 12 Months,” Yahoo! Finance, February 1, 2017, https://finance.yahoo.com/news/parks-associates-19-u-broadband-140000232.html.
more than 50 percent of U.S. OTT subscription: “More Than One-Half of OTT-Subscribing Households Pay for Multiple OTT Video Services,” ParksAssociates.com, November 30, 2017, www.parksassociates.com/blog/article/pr-11302017.
subscribing to five or more services: Ibid.
“Netflix plans to spend”: Nick Statt, “Netflix Plans to Spend $8 Billion to Make Its Library 50 Percent Original by 2018,” TheVerge.com, October 16, 2017, www.theverge.com/2017/10/16/16486436/netflix-original-content-8-billion-dollars-anime-films.
nearly 50 percent of the content: Jessica Rawden, “Netflix Is Adding More Originals but There’s a Definite Downside for Users,” CinemaBlend.com, n.d., www.cinemablend.com/television/1605310/netflix-is-adding-more-originals-but-theres-a-definite-downside-for-users.
Netflix was the top earning: Sarah Perez, “Netflix Was 2017’s Top Non-Game App by Revenue,” TechCrunch, January 12, 2018, https://techcrunch.com/2018/01/12/netflix-was-2017s-top-non-game-app-by-revenue/.
Netflix Q1 2018 results: Tim Mulligan, “Netflix Q1 2018 results: Hiking Prices or Fighting Churn?,” Midia Research, April 18, 2018, www.midiaresearch.com/blog/netflix-q1-2018-results-hiking-prices-or-fighting-churn/.
profit of roughly 50 percent on DVD: Michael Liedtke, “Netflix’s Shrinking DVD Service Faces Uncertain Future,” Associated Press, January 19, 2017, https://www.apnews.com/7bdf66b8c20d4f6889eb825b33f72780/Netflix’s-shrinking-DVD-service-faces-uncertain-future.
“Consumer preferences for food”: Abigail Stevenson, “Campbell Soup CEO: Stunning Disruption in the Ecosystem of Food,” CNBC, “Mad Money with Jim Cramer,” July 21, 2016, https://www.cnbc.com/2016/07/21/campbell-soup-ceo-stunning-disruption-in-the-ecosystem-of-food.html.
Home-delivered “meal kits”: Bob Goldin and Barry Friends, “Meal Kits: Are They a Real Threat to Foodservice, Retail or Both?,” Pentallect POV, June 27, 2017, http://pentallect.com/wp-content/uploads/2017/06/Pentallct-POV-Meal-Kits.pdf.
multitrillion-dollar food industry: Ibid.
class-action “stock drop” lawsuit: Katie Roof, “Blue Apron Hit with Multiple Class Action Lawsuits,” TechCrunch, August 21, 2017, https://techcrunch.com/2017/08/21/blue-apron-hit-with-class-action-lawsuit-from-shareholders.
According to an analysis: Daniel McCarthy, “A Detailed Look at Blue Apron’s Challenging Unit Economics,” LinkedIn Article, June 27, 2017, https://www.linkedin.com/pulse/detailed-look-blue-aprons-challenging-unit-economics-daniel-mccarthy.
for Q4 2017, it reported: Blue April Holdings, Inc. Reports First Quarter 2018 Results,” BusinessWire, May 3, 2018. www.businesswire.com/news/home/20180503005277/en/Blue-Apron-Holdings-Inc.Reports-Quarter-2018-Results.
“Our initial indications”: “Bl
ue Apron Holdings’ (APRN) CEO Matt Salzberg on Q3 2017 Results—Earnings Call Transcript,” SeekingAlpha.com, November 2, 2017, https://seekingalpha.com/article/4119692-blue-apron-holdings-aprn-ceo-matt-salzberg-q3-2017-results-earnings-call-transcript.
“bitterness of poor quality”: Attributed to Aldo Gucci. Original source unknown.
retaining existing customers: Khalid Saleh, “Customer Acquisition vs. Retention Costs—Statistics and Trends,” Invesp, n.d., www.invespcro.com/blog/customer-acquisition-retention.
PATH 8 PARTNERSHIPS
“Partnership is the way”: Attributed to Alanis Morissette. Unknown source.
Forty-eight percent of global CEOs: “Joint Ventures and Strategic Alliances: Examining the Keys to Success,” PwC.com, 2016, www.pwc.com/us/en/deals/publications/joint-ventures-strategic-alliances.html.
Two-thirds of CEOs: Now or Never: 2016 Global CEO Outlook, KPMG.com, June 2016, https://home.kpmg.com/content/dam/kpmg/pdf/2016/07/2016_Global_CEO_Outlook_Final.pdf?logActivity=true.
Eighty-five percent of business owners: Grow from the Right Intro: A Report on the Strategic Value of Business Alliances and Compatible Partner Matching, Powerlinx, BPI Network, and CMO Council, September 2014, www.powerlinx.com/blog/grow-from-right-intro-strategic-partnerships/.
Michael Dell launched PC’s Limited: “About Dell: Our History,” Dell.com, www.dell.com/learn/us/en/uscorp1/our-history.
Dell found itself: “Direct the World Over: Dell Fiscal 2006 in Review,” Zonebourse.com, n.d., www.zonebourse.com/DELL-TECHNOLOGIES-31257688/pdf/73012/Dell%20Technologies_Rapport-institutionnel.pdf.
“If you are not partnering”: Challenge or Be Challenged: How to Succeed in Today’s Business Environment, Forbes, Insights, in association with Gap International, 2017, https://i.forbesimg.com/forbesinsights/gap_international/ChallengeOrBeChallenged.pdf, 8.
Gateway closed all 188 stores: Jamie Holguin, “Gateway Closing Stores,” CBS News, April 2, 2004, www.cbsnews.com/news/gateway-closing-stores/.
$43 billion under the newly formed DELL-EMC partner program: Lynn Haber, “Dell EMC Shores Up Partner Program for 2018,” February 7, 2018, Channel Futures, www.channelfutures.com/channel-futures/dell-emc-shores-partner-program-2018.
“Partners have been”: Mark Haranas, “Cisco CEO Chuck Robbins: The ‘5 Key Elements’ of Cisco’s Digital and Channel Strategy,” CRN.com, November 1, 2017, www.crn.com/slide-shows/networking/300094906/cisco-ceo-chuck-robbins-the-5-key-elements-of-ciscos-digital-and-channel-strategy.htm.
Cisco Systems discontinued: Mark Reilly, “How Flip’s Demise Got GoPro on Best Buy Shelves,” Minneapolis/St. Paul Business Journal, June 20, 2013, Bizjournals.com, www.bizjournals.com/twincities/morning_roundup/2013/06/how-flips-demise-got-gopro-on-best.html.
GoPro became one of: R. D. Greengold, “How Best Buy’s Success Could Be a Blessing for GoPro,” Motley Fool, September 9, 2015, www.fool.com/investing/general/2015/09/09/how-best-buys-success-could-be-a-blessing-for-gopr.aspx.
“We’ve always felt”: Christopher Heine, “Red Bull and GoPro Team Up to Create More High-Flying Videos,” Adweek, May 24, 2016, www.adweek.com/digital/red-bull-and-gopro-team-create-more-high-flying-videos-171648/.
“As partners, Red Bull”: “GoPro and Red Bull Form Exclusive Global Partnership,” GoPro.com, The Inside Line, May 24, 2016, https://gopro.com/news/gopro-and-red-bull-form-exclusive-global-partnership.
According to Statista: “Most Popular YouTube Brand Channels as of October 2017, Ranked by Total Number of Video Views (in Billions),” Statista.com, n.d., www.statista.com/statistics/277765/most-popular-youtube-brand-channels-ranked-by-views.
On its fourth-quarter 2017: “GoPro Announces Fourth Quarter and Full Year 2017 Results,” PR Newswire, Cision, February 1, 2018, www.prnewswire.com/news-releases/gopro-announces-fourth-quarter-and-full-year-2017-results-300592276.html.
GoPro has made partnerships: Leo Sun, “Do Any of GoPro Inc’s Recent Partnerships Matter?,” Motley Fool, March 2, 2016, www.fool.com/investing/general/2016/03/02/do-any-of-gopro-incs-recent-partnerships-matter.aspx.
“We view this as”: Adam Rogers, “What Do Analysts Expect from GoPro in 2Q16?,” Market Realist, July 15, 2016, http://marketrealist.com/2016/07/gopros-major-partnerships-2q16.
“It is literally true”: Attributed to Napoleon Hill. Original source unknown.
Airline Deregulation Act: David Morris, “Airline Deregulation: A Triumph of Ideology over Evidence,” Huffington Post, The Blog, December 13, 2013, updated April 19, 2017, www.huffingtonpost.com/david-morris/airline-deregulation-ideology-over-evidence_b_4399150.html.
Civil Aeronautics Board (CAB) set fares: Ibid.
largest domestic U.S. carrier: Madhu Unnikrishnan, “A Law That Changed the Airline Industry Beyond Recognition (1978),” Aviation Week Network, June 4, 2015, http://aviationweek.com/blog/law-changed-airline-industry-beyond-recognition-1978.
number of air passengers tripled: Jeffrey M. Jones, “Airline Satisfaction Remains High,” Gallup, December 13, 2007, http://news.gallup.com/poll/103237/airline-satisfaction-remains-high.aspx?version=print.
expects 7.2 billion passengers: “IATA Forecasts Passenger Demand to Double over 20 Years.”
The International Air Transport: “IATA Forecasts Passenger Demand to Double over 20 Years,” IATA Pressroom, press release, October 18, 2016, www.iata.org/pressroom/pr/Pages/2016-10-18-02.aspx.
Airline ticket prices have fallen: Derek Thompson, “How Airline Ticket Prices Fell 50% in 30 Years (and Why Nobody Noticed),” Atlantic, February 28, 2013, www.theatlantic.com/business/archive/2013/02/how-airline-ticket-prices-fell-50-in-30-years-and-why-nobody-noticed/273506/.
frequent flyer programs: Julian Mark Kheel, “Do Loyalty Programs Make More Money for the Airlines Than Flying?,” ThePointsGuy.com, March 31, 2017, https://thepointsguy.com/2017/03/do-loyalty-programs-make-money/.
leverage the partnership: Hugo Martin, “Frequent Flier Programs Generate Profits for Airlines and Frustration for Travelers,” Los Angeles Times, September 15, 2017, www.latimes.com/business/la-fi-frequent-flier-programs-20170914-story.html.
“Our partnership with American Express”: Ibid.
Best Airline Alliance: “Skytrax World Airline Awards,” WorldAirlineAwards.com, n.d., www.worldairlineawards.com/Awards/worlds_best_airline_alliance.html.
“It doesn’t matter”: Kelsey Murray, “Mark Cuban Says It Doesn’t Matter if You Fail, You Just Have to Be Right Once,” ThriveGlobal.com, June 5, 2017, https://journal.thriveglobal.com/mark-cuban-says-it-doesnt-matter-if-you-fail-you-just-have-to-be-right-once-e19b32b4de0c.
commission rates for iTunes affiliates: James Vincent, “Apple Clarifies Commission Cuts for iTunes Affiliates,” TheVerge.com, May 8, 2017, www.theverge.com/2017/5/8/15577104/itunes-affiliate-program-commission-rate-changes.
“A strong relationship with”: Donald V. Fites, “Make Your Dealers Your Partners,” Harvard Business Review, March–April 1996, https://hbr.org/1996/03/make-your-dealers-your-partners.
PATH 9 CO-OPETITION
“No one can succeed”: Thomas L. Friedman, “Collaborate vs. Collaborate,” New York Times, January 12, 2013, www.nytimes.com/2013/01/13/opinion/sunday/friedman-collaborate-vs-collaborate.html.
Creating partnerships or: Now or Never: 2016 Global CEO Outlook, KPMG.com, June 2016, https://home.kpmg.com/content/dam/kpmg/pdf/2016/07/2016_Global_CEO_Outlook_Final.pdf?logActivity=true.
Eighty-five percent of CEOs: Architects of a Better World: Building the Post-2015 Business Engagement Architecture, UN Global Compact–Accenture CEO Study on Sustainability, September 2013, https://acuns.org/wp-content/uploads/2013/10/ARCHITECTS-OF-A-BETTER-WORLD.pdf.
“While the law”: Andrew Carnegie, The Gospel of Wealth.
“In order to advance”: “Fiat Chrysler to Aid in the Development of World-Leading Autonomous Driving Platform,” BusinessChief.com, August 17, 2017, htt
p://europe.businesschief.com/technology/1402/Fiat-Chrysler-to-aid-in-the-development-of-world-leading-autonomous-driving-platform.
“The companies are talking”: Dean Takahashi, “Fiat Chrysler Joins Intel and BMW to Develop Self-Driving Cars,” VentureBeat.com, August 16, 2017, https://venturebeat.com/2017/08/16/fiat-chrysler-joins-intel-and-bmw-to-develop-self-driving-cars.
“The two factors”: Ibid.
According to A. T. Kearney: Michael Romer, Steffen Gaenzle, and Christian Weiss, How Automakers Can Survive the Self-Driving Era, ATKearney.com, 2016, www.atkearney.com/automotive/article?/a/how-automakers-can-survive-the-self-driving-era.
“The future of transportation”: Phil LeBeau, “Fiat Chrysler Joins BMW and Intel to Develop Self-Driving Cars,” CNBC, August 16, 2017, www.cnbc.com/2017/08/15/fiat-chrysler-joins-bmw-and-intel-to-develop-self-driving-cars.html.
“the most powerful alliance in tech history”: Aaron Tilley, “The End of Wintel: How the Most Powerful Alliance in Tech History is Falling Apart,” Forbes, March 10, 2017, https://www.forbes.com/sites/aarontilley/2017/03/10/microsoft-intel-divorce/.
“Wintel is a computer trade industry term”: Wintel definition, TechTarget, http://searchwindowsserver.techtarget.com/definition/Wintel.
Gates proposed to acquire: Alice Kreit and Jessica Wanke, “Timeline: Bill Gates. From Geek to Gazillionaire to Do-Gooder,” NPR, www.npr.org/news/graphics/2008/june/bill_gates/gates_timeline_04.html.
The great lesson of the Wintel story: Ajay Shah, “Windows + Intel = Wintel?,” Mayin.org, 1998, www.mayin.org/ajayshah/MEDIA/1998/wintel.html.
“Cisco and EMC”: “Cisco and EMC, Together with VMware, Form Coalition to Accelerate Pervasive Data Center Virtualization and Private Cloud Infrastructures,” Cisco.com, Newsroom, November 3, 2009, https://newsroom.cisco.com/press-release-content?type=webcontent&articleId=5211915.
Cisco’s CEO at the time, John Chambers, remarked: Steve Kaplan, “Customers Embracing Vblocks, but VCE Sales Harmony a Work in Progress,” BytheBell.com, October 19, 2010, http://bythebell.com/2010/10/customers-embracing-vblocks-but-vce-sales-harmony-a-work-in-progress.html.