Yesterday, the WSJ had a super-interesting article on Amazon's strategy with their connected homes, and Alexa speakers.
Since the early 2010's, the retail and tech giant had a plan. Sell speakers and peripherals at or below cost, and with hundreds of millions of people in possession of them, they will buy Amazon products.
This is not a new concept. In what feels like a hundred years ago, Chris Anderson of Wired wrote the seminal work in the software as a service space called "Free". Give away free trials, get in front of people, and sooner or later they will pay.
This, however, failed miserably at Amazon. People don't "pay", they just use the speakers:
"Hey Alexa, is Irad going to force his way out in the third?"
According to the article, Amazon has lost billions and they're remonetizing.
What doesn't work for Amazon, though, does work for horse racing.
But this sport sadly never embraced it.
This is rebating. By giving lower takeout back, bankrolls last longer, and people can become long term customers. Even those of you who don't get CAW rebate money know this well. Each and every one of us bet that $37 that's deposited the next day in our accounts.
What do long term customers do? We open the PP's. We bet. We buy horses. We visit racetracks. We plan trips around big events. We spend lots of money on the sport.
The fewer of us there are, the fewer hands go up at horse auctions. Flights are booked for the Final Four, not the Haskell.
Horse racing, like so many others businesses and verticals who have, could've made "Free" work.
They just never really tried.
Have a really nice day everyone.
No comments:
Post a Comment