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1 © The Futures Company futuresco # jwalkersmith Uber All J. Walker Smith Executive Chairman.

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Presentation on theme: "1 © The Futures Company futuresco # jwalkersmith Uber All J. Walker Smith Executive Chairman."— Presentation transcript:

1 1 © The Futures Company futuresco # jwalkersmith Uber All J. Walker Smith Executive Chairman FutureView 2015 LIVE Tomorrow’s Vertex of Value in On-Demand, Premium, Dynamic Pricing and Personal Services

2 2 © The Futures Company futuresco # jwalkersmith FutureView LIVE The digital reengineering of business models … Into on-demand personal services … That are more affordable for most … While unlocking hidden niches of … Premium demand and value-added pricing. Uber All Economy

3 3 © The Futures Company futuresco # jwalkersmith FutureView LIVE Uber All Economy Today’s Agenda Rough ride economy Liftoff Uber All Facing forward Switching over Tight fit

4 4 © The Futures Company futuresco # jwalkersmith FutureView LIVE Uber All Economy Rough ride economy Liftoff Uber All Facing forward Switching over Tight fit Today’s Agenda

5 5 © The Futures Company futuresco # jwalkersmith Rough ride economy “Despite setbacks, an uneven global recovery continues. Largely due to weaker-than-expected global activity in the first half of 2014, the growth forecast for the world economy has been revised downward to 3.3 percent for this year, 0.4 percentage point lower than in the April 2014 World Economic Outlook (WEO). The global growth projection for 2015 was lowered to 3.8 percent. “Downside risks have increased since the spring. Short-term risks include a worsening of geopolitical tensions and a reversal of recent risk spread and volatility compression in financial markets. Medium- term risks include stagnation and low potential growth in advanced economies and a decline in potential growth in emerging markets.” First things first … Global economy running slow IMF

6 6 © The Futures Company futuresco # jwalkersmith https://www.youtube.com/watch?v=DB5MAiFrmhg Rough ride economy Conference Board First things first … Global economy running slow We project global growth in 2015 at 3.4%, marking the fourth consecutive year of disappointing performance. Jobs, investment and productivity continue to be weak. Add geopolitical tensions and you get real pessimism. We may see a mere 3% average annual growth between now and While the world economy is not about to fall off the cliff, 3% will likely not satisfy the increased health, housing and safety needs of growing middle classes in emerging economies or service the world’s aging populations. Bart van Ark, Conference Board Chief Economist

7 7 © The Futures Company futuresco # jwalkersmith Rough ride economy First things first … U.S. economy also running slow Federal Reserve Longer run Sept June Sept June Sept June 2.0 % to 2.2 % 2.1 % to 2.3 % 2.6 % to 3.0 % 3.0 % to 3.2 % 2.0 % to 2.3 % 2.1 % to 2.3 % Range of annual real GDP growth forecasts during 2014 FOMC meetings among Federal Reserve Bank Presidents and Board Members March 2.8 % to 3.0 % 3.0 % to 3.2 % 2.2 % to 2.3 %

8 8 © The Futures Company futuresco # jwalkersmith Rough ride economy A sizable output gap in U.S. economic performance BEA/CBO Potential GDP Real GDP Potential GDP $868 billion below potential

9 9 © The Futures Company futuresco # jwalkersmith Rough ride economy Closing the output gap is going to take time BEA/CBO

10 10 © The Futures Company futuresco # jwalkersmith Rough ride economy What about the record-setting November jobs report? The question is not whether it was a great jobs report. It’s whether it foreshadows a change in economic trajectory. The answer is that it was a great but not a game-changing report. Michael Strain Deputy Director, Economic Policy Studies American Enterprise Institute

11 11 © The Futures Company futuresco # jwalkersmith Rough ride economy It takes more than jobs – wages must grow, too

12 12 © The Futures Company futuresco # jwalkersmith Rough ride economy Macroeconomy mirrored in consumer economy

13 13 © The Futures Company futuresco # jwalkersmith Rough ride economy Macroeconomy mirrored in consumer economy P&G Profit Up Slightly; Sales Growth Remains Sluggish Company Tries to Get More Consumers to 'Trade Up' to Pricier Products (WSJ, April 23, 2014) Unilever reports slowest sales growth in 5 years (FT, October 23, 2014) 'Urgent' Walmart Memo Lays Out Strategy To Boost Grocery Sales (HuffPost Business, November 12, 2014)

14 14 © The Futures Company futuresco # jwalkersmith Rough ride economy Key takeaways The old models of doing business face powerful headwinds Strong revenue growth is becoming much more challenging Consumers are struggling to stay even, much less spend freely A new business model will be better suited to these circumstances There is big growth potential in a better match of model to situation

15 15 © The Futures Company futuresco # jwalkersmith FutureView LIVE Uber All Economy Rough ride economy Liftoff Uber All Facing forward Switching over Tight fit Today’s Agenda

16 16 © The Futures Company futuresco # jwalkersmith Liftoff Uber All In a lukewarm economy, Uber is red hot Its recent investment round of $1.2B that closed in early December puts Uber’s current market cap over 2X its June valuation of $17B.

17 17 © The Futures Company futuresco # jwalkersmith Liftoff Uber All It’s about Uber-like business models for everything $ 4.8 B + invested to date in on-demand start-ups including $ 2.2 B + in past 12 months e-on-demand-economy

18 18 © The Futures Company futuresco # jwalkersmith Liftoff Uber All “An Uber for dry cleaning and laundry” Go ahead, pick a category, any category Laundry detergent

19 19 © The Futures Company futuresco # jwalkersmith Liftoff Uber All Go ahead, pick a category, any category Laundry detergent

20 20 © The Futures Company futuresco # jwalkersmith Liftoff Uber All Every consumer category is going to be affected “Aided by the playbook of GrubHub/Seamless, Uber, and Airbnb [restaurants, transportation, hospitality], service providers in newer categories are anticipated to reach scale rapidly. “In a survey conducted by The On-Demand Economy of 18 high- profile industry “influencers,” grocery, home services, and local events were the most likely to experience explosive growth over the next three years.” The 'On-Demand Economy' Is Revolutionizing Consumer Behavior — Here's How Mike Jaconi, CEO of Button July 13, 2014

21 21 © The Futures Company futuresco # jwalkersmith Liftoff Uber All Established companies putting a toe in the water

22 22 © The Futures Company futuresco # jwalkersmith Liftoff Uber All But the future demands a more aggressive posture Monthly average price for an individual (nonfleet) medallion: $871,667 $840,000 Nov.

23 23 © The Futures Company futuresco # jwalkersmith Liftoff Uber All “A lot to learn” from the Uber business model “Last October, Boloco co-founder and CEO John Pepper resigned his job after a tussle with directors about the (regional burritos) restaurant chain's direction. “In that situation, lots of other entrepreneurs might take time off to travel, or become an ‘entrepreneur in residence’ at a college or investment firm. “Pepper decided to become a part-time Uber driver.” Q. Did you sign up because you wanted to learn about Uber? A. Whatever business I do next, there's a lot to learn from their model … I think they could really affect the world of restaurant and retail. What happened when Boloco founder John Pepper became an Uber driver (Boston.com, February 7, 2014)

24 24 © The Futures Company futuresco # jwalkersmith Key takeaways Liftoff Uber All Uber All is the new motive force in the marketplace It is the path to explosive value growth even in the current economy This new model is being rapidly pioneered by well-funded start-ups At the very least, this is a huge new competitive threat But established companies should tap into this opportunity, too

25 25 © The Futures Company futuresco # jwalkersmith FutureView LIVE Uber All Economy Rough ride economy Liftoff Uber All Facing forward Switching over Tight fit Today’s Agenda

26 26 © The Futures Company futuresco # jwalkersmith Switching over Uber business model Personal service … … available on demand … … and priced by usage.

27 27 © The Futures Company futuresco # jwalkersmith Switching over Uber business model Idle assets Products-plus Substitution Personal service … … available on demand … … and priced by usage. From one use to another

28 28 © The Futures Company futuresco # jwalkersmith Switching over Uber business model Idle assets Products-plus Substitution Mobile Apps Fulfillment Personal service … … available on demand … … and priced by usage. From one use to another From “go to” to “come to”

29 29 © The Futures Company futuresco # jwalkersmith Switching over Uber business model By the slice Occasions Premium Idle assets Products-plus Substitution Mobile Apps Fulfillment Personal service … … available on demand … … and priced by usage. From one use to another From “go to” to “come to” From flat rate to tiered

30 30 © The Futures Company futuresco # jwalkersmith Switching over Places and head spaces

31 31 © The Futures Company futuresco # jwalkersmith Switching over Blooms and Bouquets

32 32 © The Futures Company futuresco # jwalkersmith Switching over Grocery retail

33 33 © The Futures Company futuresco # jwalkersmith Switching over The Pivot to Passive will power Uber All Pizza Hut menu picks toppings for you by tracking eye movements za-hut-eye-menu/

34 34 © The Futures Company futuresco # jwalkersmith Switching over The three-legged stool of Uber-ization Anchor value in a service Execute with immediacy Charge by usage Performance Pricing Proposition The driver’s seat

35 35 © The Futures Company futuresco # jwalkersmith FutureView LIVE Uber All Economy Rough ride economy Liftoff Uber All Facing forward Switching over Tight fit Today’s Agenda

36 36 © The Futures Company futuresco # jwalkersmith Tight fit 1. Service is where the action is 72 % If I am getting bad service, I will walk out of a store even if they have exactly what I am looking for Source: U.S. MONITOR 2014

37 37 © The Futures Company futuresco # jwalkersmith Tight fit 1. Service is where the action is 68 % Mexico 77 % Colombia 70 % Brazil 59 % Argentina 76 % Turkey 62 % Russia 64 % South Africa 71 % Kenya 91 % Nigeria 86 % India 74 % Indonesia 84 % China 85 % Thailand Somewhat/very likely in next 12 months to pay for a service that provides extra convenience in your life (Source: Global MONITOR 2014)

38 38 © The Futures Company futuresco # jwalkersmith Tight fit 2. The future of service is immediacy Amazon has led the way in retail with a relentless focus on speed

39 39 © The Futures Company futuresco # jwalkersmith Tight fit 2. The future of service is immediacy Cheap Quality Fast UberX Uber Black Uber SUV UberXL Uber is budget or premium. Both are fast. There is no price or quality at which there is any such thing as ‘slow Uber.’ Adapted from …

40 40 © The Futures Company futuresco # jwalkersmith Tight fit 3. Perfect analogue to future labor markets Software and robotics are fundamentally upending employment Computers put “47% of total US employment at risk … [in] perhaps a decade or two.”

41 41 © The Futures Company futuresco # jwalkersmith Tight fit 3. Perfect analogue to future labor markets A bifurcation of work into those who manage technology and those who provide various personal services for those who manage technology “As workers are displaced by smart machines in manufacturing and other areas, more individuals will be employed as personal trainers, valets, private tutors, drivers, babysitters, interior designers, carpenters, and other forms of direct personal services … The middle of the distribution is thinning out and this process appears to have a long ways to run.” “We can expect a lot of job growth in personal services … The more that the high earners pull in, the more people will compete to service them, sometimes for high wages and sometimes for low wages.”

42 42 © The Futures Company futuresco # jwalkersmith Tight fit 3. Perfect analogue to future labor markets Uber is exactly this – the intersection of tech and personal services Uber is run by people who manage the technology Uber employs people selling a personal service Similarly, Uber-like business models will thrive by virtue of being structured appropriately to tap directly into the labor and skills pools of the future job market

43 43 © The Futures Company futuresco # jwalkersmith Tight fit 3. Perfect analogue to future labor markets Woman opens professional cuddling shop – gets 10,000 customers in first week Hair strokes, hand-holding, caressing and conversation is also available November 19, 2014 Professional cuddler Samantha Hess has opened a pro cuddling shop, where for $60 customers can get an hour's worth of spooning and "the level of human contact that we want or need in order to be our optimal selves." Located in Portland, Oregon, the shop is called Cuddle Up To Me and is already very busy. 42A

44 44 © The Futures Company futuresco # jwalkersmith Tight fit 4. Right match for household resources Household finances are being squeezed -$5,500 Housing College savings Health care Child care Retirement Groceries Clothing Phone Emergencies https://www.americanprogress.org/issues/economy/report/2014/09/24/96903/the-middle-class-squeeze/

45 45 © The Futures Company futuresco # jwalkersmith Tight fit 4. Right match for household resources Payment on demand is already widespread – and spreading rapidly Foundation Capital associate Zach Noorani and early Uber investor Shirven Pishevar

46 46 © The Futures Company futuresco # jwalkersmith Tight fit 4. Right match for household resources Unlocks value-plus pricing opportunities Not targeting people willing and able to pay a premium Fewer and farther between Targeting occasions in which people of all means are price indifferent Service on demand worth it

47 47 © The Futures Company futuresco # jwalkersmith FutureView LIVE Uber All Economy Rough ride economy Liftoff Uber All Facing forward Switching over Tight fit Today’s Agenda

48 48 © The Futures Company futuresco # jwalkersmith Facing forward The imperative … Figuring out how to Uber-ize Services The future of service, service types and formats

49 49 © The Futures Company futuresco # jwalkersmith Facing forward The imperative … Figuring out how to Uber-ize Services The future of service, service types and formats Immediacy Benchmarking against trends shaping expectations

50 50 © The Futures Company futuresco # jwalkersmith Facing forward The imperative … Figuring out how to Uber-ize Services The future of service, service types and formats Immediacy Occasions Benchmarking against trends shaping expectations Super-sale and Superstar Segmentation of Now ®

51 51 © The Futures Company futuresco # jwalkersmith Uber All J. Walker Smith Executive Chairman FutureView 2015 LIVE Tomorrow’s Vertex of Value in On-Demand, Premium, Dynamic Pricing and Personal Services Thank you!


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