Killing Netflix “Profiles” - A Stupid Business Decision
Netflix is ending its longstanding policy of allowing customers to hold multiple profiles under a single account. The announcement was sent to users today:
We wanted to let you know we will be eliminating Profiles, the feature that allowed you to set up separate DVD Queues under one account, effective September 1, 2008.
Each additional Profile Queue will be unavailable after September 1, 2008. Before then, we recommend you consolidate any of your Profile Queues to your main account Queue or print them out.
The profiles feature was an excellent way for multiple people living in a single household (husband/wife, roommates, etc) to maintain separate queues and profiles of the movies they have liked, disliked, etc., while keeping a joint account of discs sent to the same address for billing purposes and convenience.
The rationale for the move is not substantially explained in the Netflix communication.
While it may be disappointing to see Profiles go away, this change will help us continue to improve the Netflix website for all our customers.
The most likely explanation is that Netflix has determined that joint accounts are causing them to lose revenue due to their pricing structure. In effect, multiple users in a single household gain scale efficiencies because it is cheaper to have a single account sending 4 discs at a time ($23.99) than it would be sending 2 different accounts 2 discs at a time ($13.99 x 2, or $27.98, a $4.00 difference). If multiplied across millions of accounts on a monthly basis, that could mean a lot of additional revenue for Netflix.
… IF it doesn’t turn a large number of their customers away.
The real shocker can be found on the FAQ linked from the email sent out today:
You will not be able to transfer your Profiles data to a separate new account
Consider moving all DVD titles in your Profiles Queues to your main account Queue
How does that make any sense? Does Netflix seriously expect the wives and roommates and brothers and sisters who have been sharing accounts to merge their accounts into a single account and lose all of the individuality and “social profile” data that they used to enjoy from the site? This mass of data, and the power of the Netflix recommendation engine was one of the major differentiators that kept its users on the site.
To quickly come to my point, this is a plain stupid business decision. Here’s why:
- Users will now have to pay two bills where they used to pay one
- Users will lose all of the data they have built up over time while using Netflix, eliminating the barrier that once kept them from switching to a competitor, such as Blockbuster
- Users who decide to stay with Netflix will be forced to spend hours re-entering their movie ratings and rental queues
- Users who have been too lazy to close or downgrade their accounts won’t renew their accounts, killing the “momentem” that once kept them paying every month
- Users who do decide to turn their single account into two different accounts will feel like Netflix is nickle-and-diming them, forcing them to pay more for a less convenient, equivalent service that they used to pay less for
- New customers that might have been attracted to the idea of a single Netflix account per household (it’s easy to convince a new roomie to pay $3.00 a month to move from a 2 to 3 disc account, when they might not have been willing to pay $9.00 a month to get an account of their own)
Who wins from this decision?
- Traditional competitors who can take advantage of the mass of new potential customers shopping for a DVD rental service (e.g. Blockbuster)
- New competitors (e.g. iTunes movie downloads) who will open their arms to an influx of users who no longer have any reason to stay with Netflix and its old DVD-by-mail technology
Am I missing something here, or did Netflix just make a huge blunder?
Apple’s MobileMe: A Good Idea for the Wrong Price
Apple’s new MobileMe service, which will allow consumers to sync their mail, calendar, contacts, and other content across their phone, personal computer, and any other device which can access the web, has been been called “The Most Interesting part of this year’s WWDC” and heralded by some to be poised to “Crush Exchange and Google.” While the enthusiasm for a clean, integrated connectivity service is understandable, it exaggerates the willingness of consumers to pay for a service that, while imperfect in its implementation today, is almost entirely available today FOR FREE.
I don’t believe that MobileMe adds enough incremental value for consumers to be willing to shell out $99 - $149 per year for the ability to do what they can already. MobileMe is a service that is too expensive and too late.
Seamless connection of email between mobile and web? Try Gmail and its handy mobile application for the iPhone and Blackberry.
Seamless connection of calendars? Try Google Calendar and Google Sync for mobile, which smoothly integrates into your Blackberry.
Photos hosted on your desktop and online? Try using Picasa Web plugins for iPhoto, or the Picasa application for PCs.
Getting this kind of functionality today does require that users plug the pieces together on their own. And it isn’t necessarily perfect. Admittedly, some of the features offered by MobileMe are not offered elsewhere - at least that I know about. For instance, constantly synchronized filing and sorting images and files (if I merge two albums in iPhoto, after both have been uploaded to Picasa Web, I have to duplicate that action on the Picasa website) and synchronized contacts (my BlackBerry integration with Lotus Notes or Outlook is perfect, but MobileMe, which is positioned as “Exchange for the rest of us,” is clearly targeting users that have neither) are both new and useful services, but are not justifiable at this price point.
Apple announced its new MobileMe service yesterday at the WWDC in San Francisco. The service is not yet available on Apple’s website (you can currently only sign up to be notified when it is ready), so I can only speculate as to its full functionality. MobileMe will replace its existing .Mac service. Given how weak customer enthusiasm had been for the original .mac service (which I also feel is largely due to its price relative to other offerings from Google and Yahoo), however, MobileMe’s heritage isn’t exactly a bragging right.
One reason MobileMe could win some users initially, however, is that consumers may rush in to claim valuable username real estate. “Mitch@Me.com” has a certain ring to it…
What do you think? Are MobileMe’s features enough to win consumers over? Will they be willing to fork out $100 for features that can essentially be pieced together for free online today?
Coverage of the announcement of MobileMe:
Greystripe - Developing a Complete Mobile Phone Advertising System from Scratch
After attending a presentation yesterday by CEO and Founder, Michael Chang, and VP of Operations, Kurt Hawks, about their startup, Greystripe, I have a newfound appreciation for the challenges that face entrepreneurs innovating in a part of the market where there is so much uncertainty. Greystripe’s primary revenue stream is from the sale of visual ads placed on mobile phones, but the story of how they got there, and the challenges they had to overcome, was both inspiring and daunting. I want to share a condensed version of that story, although I apologize in advance if any of it has been mangled in the retelling.
Where they are today:
Greystripe is an advertising network, content publishing partner, and distribution network for mobile phones that is VC backed by Steamboat Ventures, Incubic, Monitor Ventures. Its most recent capital round, a series B, raised $9 million. Their free, ad-supported games are being downloaded at a rate of 250,000 per day, by users all over the world.
How they got here:
Chang’s presentation focused on how the company has evolved since getting off the ground in 2005, and the multiple iterations the company has gone through in creating its current business model. The company started with a focus on mobile advertising in a single vertical: location based services. Inherent from day one in this business were challenges of developing content for different screen sizes, across different phone manufacturers (e.g. Nokia, Samsung, Motorola) with different operating system software (e.g. Palm, RIM, Microsoft), operating on different telephone networks (e.g. AT&T, T-mobile, Verizon), with different wireless technologies (e.g. GSM, CDMA). The complexity would not stop there.
As it became clear that location based services were evolving much slower than they had hoped, Greystripe’s focus shifted to a different vertical, gaming and applications. Games were sourced from publishers (e.g. Digital Chocolate, Hands-on Mobile), modified with the company’s AdWRAP technology, which inserts additional blank screen pages for advertisements before and after gameplay, and offered for free to users to download on their mobile phones. The next challenge, then, was to find advertisers who would pay for the full-screen advertising real estate within these games. Their search for an advertising network which could effectively source those ads on their behalf turned up empty, and again the fledgling company was back to the drawing boards.
Developing an advertising network, which places ads on behalf of companies and advertising agencies, would require a larger sales force, and a different business model than Greystripe had originally envisioned. A sales team was hired, relationships developed, and the first ads were placed. As the network took shape, and advertisers began to take notice, two new challenges would emerge. First, visual modifications would have to be made to the ads to serve the multiple screen sizes and formats, and second, the games would have to be distributed to users for download. The second would prove to be particularly daunting: it became clear that there were no effective distribution avenues available to ensure that games could actually reach users.
The next iteration of the company therefore took on this challenge: developing a diverse set of distribution channels for publishers. These have evolved to include mobile providers’ own catalogs of games and applications available for download, the sites of the game publishers, and GameJump, a portal developed by Greystripe.
Greystripe today is fully functional end-to-end, and is revenue generating (though not yet profitable). The company is now in its fifth iteration of its business model, and both Chang and Hawks sounded optimistic that even if not the company’s last, that it offered their greatest chance for success to date. Chang acknowledged that future developments could include gathering more detailed profile information about the users of its ad supported games, layering on location sensing technologies, and using it to more precisely target ads to specific users, allowing them to demand a higher premium per screen view from advertisers.
For the potential entrepreneur’s in the audience, Chang offered several tidbits of advice - including the importance of this kind of iteration and evolution in the formation of a business: “Push things far enough to really test the business model, but without pushing them so far that you run the company into the ground.”
TripIt and Dopplr - A Match (which could be) Made in Heaven
I was recently introduced to TripIt, a “next generation” travel site which has really impressed me in my first day as a user. It replaces Dopplr (which I have used for approximately four months now) as my favorite startup travel destination on the web for two major reasons: its superior input methodology and the practical usefulness of the site’s main service: itinerary aggregation.
While these sites are clearly competitors, I think they might find that if a collaboration agreement could be reached, the sum would be greater than the parts.
Primary Functionality:
If you were to ask me what Dopplr’s primary purpose was - its raison d’être - I would say creating community around travel, particularly for frequent travelers. It notifies me when I will be in the same place as one of my friends (still hasn’t happened to date, but I like the idea) so that we might meet up and grab dinner or a drink, or perhaps to share travel plans and tips. It also allows users to share their ideas and expertise about the places the visit frequently with other users online. In other words, it is a site that’s all about community. Unfortunately, there isn’t much of one yet. Until it has gained the faithful participation of more of my friends and acquaintances (which it has certainly been doing in the last few months), it just isn’t very useful to me.
TripIt, on the other hand, has a pretty compelling service from the get-go. It offers to aggregate the disparate elements of my travels into a single master itinerary. In effect, it does all those nice things your assistant would do for you when planning your travel, if you were lucky enough to have one. It allows me to look to a single location for all of my travel details: what flight I am on, what time it leaves, when it arrives, what seat I am in, what hotel I am staying at (at what address, with what phone number), and which rental car company I will be using to get there. It even provides a few handy “value-adds” such as weather forecasts for the locations I will be in each day, and quick access to city maps.
In January, TripIt added some social functionality and is attempting to build a community element which appears similar to Dopplr. Nevertheless, it’s community appears to be even thinner than Dopplr’s, and has a long way to catch up.
Input:
Whereas Dopplr offers a fairly easy and intuitive method of inputting travel locations and dates, TripIt introduces an input methodology that is truly groundbreaking (in my experience, at least). Instead of requiring any real effort on my part, all I have to do is forward them my confirmation emails (from United, Hertz, and Sheraton, for instance) and it parses the information to identify all the pertinent details. It loads this detail into my calendar instantly and automatically, even capturing things like my frequent flyer numbers.
Another blogger who recently compared Dopplr and TripIt suggested an even better idea: setup an email filter to automatically forward travel plans to TripIt, eliminating even that minimal effort required to put the site to work for me. With an email filter in place, TripIt would automatically aggregate all travel details, update my travel calendar, and stream it through iCal to calendar programs like Google Calendars. (As a side note, am I the only person who wishes you could use an iCal stream as an input into an existing Google Calendar entry, rather than requiring you to establish a separate calendar for external feeds?)
Once in my Google Calendar, my travel plans (and location) would be easily shared with friends and colleagues. Even better, once they join the TripIt community, we can even build collaborative itineraries (such as a business trip with several colleagues making arrangements for the group individually).
The Case for Collaboration:
In summary, TripIt has quickly won me over on its practicality and simplicity. Where it still falls far short of Dopplr, however, is on the community element. Dopplr’s Facebook application and blog widget (which I use here as well as at mitchellwfox.com) allow me to quickly and easily allow others to track my location. The potential value of discovering that a friend’s travels will overlap with my own is strong enough to convince me to continue updating my itineraries there in the meantime. If, however, TripIt’s itinerary aggregation and input could be joined with the powerful potential of community I see in Dopplr’s model, it would be a match made in frequent-flyer heaver.
Where from Here:
It will be interesting to see how the TripIt business model develops. In my initial usage of the site, I didn’t see any obvious indicators of what their eventual business model would be. Following in the steps of the likes of TripAdvisor by adding advertising and the ability to book trips would seem a logical course of action. One interesting suggestion made by another blogger was to enable travelers to re-book previous itineraries through a simple interface asking for the dates of the repeat booking, which could then be executed through a partner, such as Expedia or Kayak. Given the convenience this would provide the user, you might be able to extract a small booking fee.
It is an exciting time in the development of online travel tools - I wonder what’s next.
Growing Excitement Around Product Recommendation Software
When you are shopping, a sales person who can quickly understand your needs, preferences, and budget and make a reasonable, logical recommendation is invaluable. While shopping online has typically required that customers already know what they were looking for, or that they conduct extensive research online in advance of a purchase, software is increasing playing the role of the sales person. While approaches to providing customer shopping recommendations have evolved with time, however, today’s software leaves considerable room for improvement. The recent funding of a Bay Area startup focused on customer recommendation demonstrates that venture capitalists have started to wake up to the potential this technology could hold.
Consumer recommendation tools online initially began by mirroring something that already existed in the print world: editor’s reviews and “product of the year” comparisons. Later came “Buyer’s Guides” which followed a simplistic logic to evaluate a few short responses to an online survey to provide a customer recommendation. Then came Amazon’s product recommendations, based upon the analysis of other customer decisions (”others who purchased this item also purchased…”). This basic methodology has since been implemented in a number of different places around the web, with varying success. I would argue that NetFlix has been the most successful - the one site where I have significant confidence in the accuracy of the recommendations I receive, and act upon them with little or no knowledge of the film recommended. NetFlix, unlike today’s iTunes or Amazon stores, however, does this by not only considered what I have purchased (or viewed) before, but also how much I liked it.
If other online stores were able to earn my trust to a similar level without requiring the lengthy initial interview NetFlix used to gauge my movie taste, and were able to more deeply understand my shopping parameters, tastes, and the reason I arrived at their site, they would stand to gain a greater share of my wallet. If Amazon had been able to successfully recommend a book to me which I enjoyed (rather than assuming the South American literature textbooks I bought for college courses indicate a passion for Spanish authors), I would be far more likely to trust their recommendations a second time, and to begin to rely upon this functionality, visiting their store on a consistent and regular basis.
Baynote, a software firm located in Cupertino, raised $10.75 million in a second round of funding last year from Steamboat Ventures. Its software attempts to understand customer intent by observing their actions on a website, and groups him or her into one of several customer archetypes to best deliver their anticipated needs. The challenge, however, is that a customer’s visit may be so short as to fail to give enough evidence of intent for the software to accurately predict their intent.
Richrelevance, a San Francisco based technology startup which yesterday announced it had closed a Series B round of investment valued at $4.2 million dollars backed by Greylock Partners and Tugboat Ventures, is attempting to deliver this kind of next-generation product recommendation software. Built by David Selinger, a leader from Amazon’s recommendations team, richrelevance promises the ability to enhance a web store by personalizing the shopping experience and providing relevant, high quality product recommendations. Unfortunately, however, its technology doesn’t appear to make any massive improvements upon the flawed system in place at Amazon.
Perhaps this shouldn’t be surprising, however. It turns out the challenge of substantially improving recommendation algorithms and technology is a very considerable one. Even NetFlix, which posed a large cash reward to the tune of $1 million for any person or team which could improve the accuracy of its prediction software by 10%, has been unable to meet this seemingly modest goal after over a year and a half.
I will watch with curiosity as other companies tackle this challenge. I believe it is a field with significant growth potential, and one where I would be excited to see more innovation and expansion. In the meantime, reasonably talented retail sales people need not worry about losing their jobs… just yet.
ING Direct Enters Low Cost Investing
With an email announcement sent to ING Direct customers last night, the integration of ING Direct and ShareBuilder is official:
I’m pleased to announce that ShareBuilder, America’s most innovative online brokerage, is now part of ING DIRECT.
… ShareBuilder was created by its pioneering founders to make it simple and affordable for regular folks to invest in the stock market. Thanks to ShareBuilder, investors big and small can now invest, big time.
The deal, which was first announced in November, introduces an interesting new element into the world of low cost brokerages.
Earlier this year, BusinessWeek covered several new players in the world of low cost equity investment, including the likes of TradeKing, Zecco, and ThinkorSwim, who use a powerful combination of social networking and low cost trading to target first time investors. First time investors value the social element because it helps them make sense of the world of investing through easy to follow blogs, forums, and FAQs. Users answer one another’s questions, reducing the need to hire an army of support staff to help them.
Yet first time investors are also the target audience for ShareBuilder, which earned rave reviews in Forbes “Best of the Web” for its investor starter packages that included an investment guide, investment certificate, and a copy of the Wall Street Journal Guide to Understanding Personal Finance; distinctly “old-school” approaches to targeting this same audience. Its online guides to investing in ETFs are similarly praised by Forbes, and 40% of their users invest in them.
So the question comes to my mind: why did ING pick ShareBuilder? From the little I know of the company, here is some common-sense speculation:
- Acquire a well-established (ShareBuilder has been around since 1996) with a good reputation and track record
- Acquire new customers for ShareBuilder, and use the existing base of ING Direct users to add new users to ShareBuilder
- Acquire a company with a similar target customer to ING Direct: the financially inexperienced
- Extend ING Direct’s product offering of simple investment offerings to include equity investments and ETFs
How can we analyze those criteria to understand the prospects for these new social investment sites to be acquired? The first two bullets don’t currently play well, as both are still young and have relatively small pools of users, but that could change with time. The third and fourth fit quite well, assuming there are some other big fish like ING Direct looking to get into the world of equity investments.
But it is the choice of ShareBuilder and its technology approach which has me thinking this morning. It seems to be part of the “old guard” of web investment (forgive the expression: web investing 1.0), lacking any significant social elements that the new players are using as their main differentiator. But which is the better approach to addressing the needs of new investors? Easy to use, self-service FAQs and free investment books, or forums and user-generated content?
Since obviously the answer to that will depend on the particular user, and their need and desire to interaction and personal advice, I suppose the question really becomes: how big is the pool of new investors who prefer “traditional” help tools, as compared to “social” tools? Are there enough new users comfortable with social networking to slowly erode share from eTrade, ShareBuilder, and the like?
An emerging generation of young professionals who spent their college careers on social networking sites would seem to bode well for Zecco and TradeKing, but it would be interesting to see an analysis: for every 100 new investors joining a brokerage online today, how many go to each? And what can the new players do to increase those figures to their advantage?
Power-ful Information: Efficiency in Energy
People are far more likely to take action when they have the necessary information to target their actions and measure their success. In the absence of high quality information, action becomes riskier, by for instance increasing the possibility of wasting resources on inefficient tasks.
It is with this in mind that I am particularly excited about a powerful new source of information that can help the world take smarter, better action in the fight to slow global warming and protect the environment. The Center for Global Development released yesterday CARMA (CARbon Monitoring for Action), a website and database of the carbon emissions of over 50,000 power plants and 20,000 power companies around the world. Using a combination of official information and computer models, they have captured the amount of electricity generated and resulting carbon output. With this information, they have been able to identify the worst polluting countries (USA) and most inefficient countries per capita (Australia).
The one thing which bothers me about CARMA is that they have failed to make efficiency the center of attention. Similarly, articles in Nature and BBC catch the significance of carbon emissions per capita, but fail to highlight the least efficient power stations, instead focusing on the worst polluting ones.
The city of Taichung in Taiwan is home to a power plant that emits more than 37 million tonnes of carbon dioxide into the atmosphere each year, the highest of any plant in the world.
Frankly I don’t care which power plant produces the MOST emissions, I care which ones are not only fouling the air, but doing so without producing a large amount of energy.
So what ARE the lease efficient power stations in the world? It is actually difficult to tell using the tools on their site, because you cannot easily manipulate the data. Without an easy filters for minimum size of plant, if you sort by “intensity” (tons CO2 per MWh Energy) you end up with a large number of very small power stations which, while inefficient, are producing relatively tiny amounts of emission. I can tell you this, however:
- Of the top 10 largest power stations in the USA, Jeffrey Station in Kansas, Owned by WESTAR ENERGY INC is the least efficient, pumping out 16,300,000 tons of CO2 while producing only 13,900,000 MWh of energy (intensity = 2,355)
- Abadie Station in Missouri is the most efficient of the top 10 in the USA, producing 16,400,000 tons of CO2 while generating 17,700,000 MWh of energy (Intensity = 1,849). Good work AMEREN CORP
- By contrast, the worst of the top 10 in China is Tongliao Station, owned by CHINA POWER INVESTMENT CORP, producing 17,800,000 tons of CO2 and only 12,300,000 MWh of energy (Intensity = 2,902), nearly 25% worse than the worst offender in the United States
With more time, and the right tools, this database could yield some powerful insights. Here’s to hoping that those insights can lead to important changes in policy and investment.
Others have also been characterizing CARMA around the web.
E*Trade Crash a Boon for the Likes of Zecco?
News of E*Trade Financial’s stock collapse on Monday made me wonder if there is an opportunity for new up-and-comers in the stock brockerage market such as Zecco to poach fleeing customers.
If so, what are the best short-term tactics to attract them over? Perhaps an easy “migrate your account” process with step-by-step guidance on the main page?
E*Trade Financial is a leader in the new generation of Internet-only lenders. But its stock got crushed Monday amid fears about a distinctly old-fashioned problem: a run on the bank.
Shares of E*Trade lost more than half of their value after the company said it expected additional asset write-downs and an analyst suggested that it might be forced into bankruptcy protection. While the bank assured customers that it remained “well capitalized by regulatory standards,” the analyst, Prashant Bhatia of Citigroup, theorized that a rush of withdrawals might leave the bank without enough funding to operate.
It also made me wonder if those firms were exposed to the same kinds of risks. I don’t have any statistics, but my understanding and personal experience from the dot com bubble is that during a recession there is less interest in stock market investment. Could that mean that some of the same E*trade challenges could affect the new shops?
Air France and Delta Trans-Atlantic JV
The International Herald Tribune reported today “Air France and Delta forming joint venture for trans-Atlantic flights.” This is yet another development in the airline industry as different players line up to take advantage of the impending change in regulation controlling flights between the United States and the European Union.
Many airlines are jockeying to take advantage of the “Open Skies” deal, which will allow airlines to fly from anywhere in the European Union to any point in the U.S. as of March 30.
The effect will inevitably play both to the favor of customers and airlines.
Customers will benefit from lower costs and more direct-flight options as more operators are allowed to cross the Atlantic, and to fly between markets which were previously not connected. Perhaps some intrepid airline will begin flying from San Francisco to Riyadh and make my life easier (yes, I realize Saudi Arabia isn’t part of the EU… yet).
With more possible destinations, airlines will be able to operate internationally at much lower cost (by, for instance, flying into London Luton rather than Heathrow or Gatwick). As different airports become viable options, airlines should have improved bargaining power when negotiating prices on landing slots and gates.
Could this be the way that US airlines break free from there historically abysmal profit levels?
The Gluten-Free Niche
Two years ago, my friend told me she couldn’t eat bread or drink beer, but that corn-tortilla-wrapped tacos were just fine. I did my best not to look at her like she was crazy.
Then last year I met a coworker with a similar ailment, and then just this summer, a new flatmate. That trend is telling, and apparently in-sync with the growing trend in diagnosis of “Gluten Intolerance” throughout the United States. As with any ailment, increasing prevalence or diagnosis of previously inexplicable symptoms leads to new business opportunities for those willing to customize their service and products to cater to the afflicted.
In July, The New York Times wrote about Risotteria, a descriptively-named restaurant in Greenwich Village with a menu that caters to the needs of the gluten intolerant (”For the Gluten-Averse, a Menu That Works“). The success of that restaurant would seem to be a harbinger of opportunity for restaurants and food-product manufacturers looking for a new niche audience to target. Indeed, many producers have already started to move to the scene.
It has become a popular dietary villain. Gluten-free foods are popping up on grocery-store shelves and restaurant menus, including those of national chains like P. F. Chang’s and Outback Steakhouse.
The diagnosis of Celiac’s Disease (the scientific name), an autoimmune disorder wherein sufferers have an adverse reaction to Gluten, a protein found in wheat, rye, and barley (read: bread and other baked goods, beer, and a whole host of things that use wheat flour as a thickening agent) is on the rise in the United States. The New York Times wrote in May about this trend, comparing it to the similar rise in lactose-intolerance in previous times (”Jury Is Still Out on Gluten, the Latest Dietary Villain“)
The prevalence in North America was previously estimated at about 1 in 3,000, but several studies published in the last three years indicate that it is closer to 1 in 100 — and 1 in 22 for those with risk factors like having an immediate relative with celiac disease.
Two or three restaurants and a few packaged foods, however, would seem to barely touch the surface of the trend that could lie ahead. Wrong Diagnosis puts the disease’s prevalence rate at 1 in 250 Americans, and according to the University of Chicago’s Celiac Disease Center, prevalence among otherwise healthy adults may be as high as 1 in 133.
Businesses can cater to the gluten intolerant through a variety of means. For the majority of the restaurants in the world, the option will be as simple as ensuring one or two items are suitable for those with Celiac’s Disease, and labeling them appropriately in the same way vegetarian options often are. In places where populations where disproportionately many “alternative” or “healthy” diners reside, such as San Francisco and Chicago, or where a particularly aggressive diagnoser has a clinic, there is likely a large enough customer base to support a restaurant dedicated to gluten-free items. The place to start would be to contact local support groups and physician specialists to get a better feel for the size of the opportunity.
And best of all, especially for the friends of the gluten-intolerant, it turns out that the food can be quite tasty. I ate at Risotteria while in New York last year, and found my shimp, pepper, and spinach risotto to be excellent. The gluten-free beer made from sorghum, on the other hand, was another matter entirely.
- Welcome to The Strategy Fox
Welcome to the professional weblog of Mitchell W. Fox, a management strategy consultant at Bain & Company in Sydney, Australia.Mitch was previously a Consultant at the Monitor Group, is a graduate of Georgetown University (MSB '05), and was the founder of Hilltop Consultants.