As security threats grow, and credit card fraud worsens, it’s heartening to know that someone is looking around the corner and doing some rethinking about the future of credit cards.

Having said that, I will admit to being a bit surprised at the source – American Express.  This is their second really solid idea in just the last few years.  This from the company many had left for dead at the end of the 20th century.  I believe it was a top ten list in The Wall Street Journal that listed the biggest corporate blunder of the 20th century was the AmEx refusal to participate in frequent flyer points on credit card purchases, leaving the door wide open for Visa to, seemingly overnight, crush them like a tube of Pepsodent.  And with the stigma of higher merchant fees, it really didn’t look like there was any way for them to claw their way back.

Then in 2009 or 2010 came the black card, now known as the Centurion card.  It turned out to be urban legend that there was a black credit card you could get from AmEx that required an incredibly high bar of proving your personal wealth to get this card which came with all sorts of privileges.   So what did the folks at AmEx do about this urban legend about an incredibly desirable product?  They did what they should have done, which was to take the urban legend as the blueprint for what is now the very real Centurion card.  I still haven’t seen one, but I look forward to it.

That’s great for fortifying the brand, but by definition only a tiny percentage of people qualify for this product.  What would they do to get the masses?

Well that question has been answered. Emphatically.

The new prepaid card from AmEx does a couple of really smart things,

1) Drastically reduces the risk of credit card fraud because thieves can never take more than you store on the card.

2) Gives people a good way to avoid the criminally high interest rates most credit cards charge (which I have blogged about before).

Now this isn’t perfect.  AmEx still charges merchants too much, but as soon as they sort that out, Visa is in real trouble (not that there’s really anything to stop Visa, but for now AmEx has a big first mover advantage on this).  The other asterisk which isn’t really avoidable is that by having to load the card with money before you spend it, there’s a good chance AmEx is going to make money on that float, which no doubt covers some of the money they would otherwise be getting from the high interest rates,  but for people who are really diligent about loading up their cards just ahead of need, that’s not a huge issue.

Well done AmEx. 

I don’t think this would have been as relevant ten or even five years ago, but with the recent PlayStation security breach that compromised so many cards, I think the timing on this is right on the money.  There’s probably a great partnership opportunity for Sony and AmEx to use your prepaid card for a monthly subscription and then just get AmEx or Sony to send you a monthly reminder to move your money.   In that case it would make more sense to have AmEx do it for all of your monthly subscriptions, making them more central to your day-to-day financial activities.  I’d sign up for that. . . .

I bet Michael Fertik at Reputation.com would like this idea.  He might be another smart partner for AmEx,

-Ric

I have written before about businesses predicting how lazy we want to be, or how increasingly we perceive ourselves too busy to perform pretty basic tasks.  Well, once again the envelope has been pushed.

“No one ever went broke underestimating the American public” – that’s a pretty famous H.L. Mencken quote.

And comedian Jim Gaffigan is well known for his observations about bacon, including the point that bacon is so good, that people wrap certain foods in bacon to make them taste better.  Good point.

 This past weekend, my friend Tracy and I were at the grocery story picking up a couple of items when we saw  a large display in the middle of the aisle and it was a product from Oscar Mayer (Gaffigan also has some thoughts on a product for which they are known – bologna).

There it was.   Far from refrigeration.  In a box.  Fully Cooked Bacon, ready to eat.  . . .Or leave on a shelf unrefrigerated for the next year.  

Scary.

Then we saw that this craziness wasn’t limited to Oscar Mayer.  We also saw similar products from Hormel and the Safeway (where we were shopping) generic brand.  The actual product weighed 2.1 ounces and cost about $5, which means they are selling it for about forty dollars per pound, which is about twice the price of Copper River Salmon (which is an item that evokes a more P.T. Barnum quote – “there’s a sucker born every minute”).

Initially we were horrified.

But then, with three separate brands pushing the same item for about the same price, we realized that they can’t all be awful or there woudln’t be a market for this extreme expression of laziness.  And we had some fresh maple bacon waiting for us in the refrigerator (because that’s where meat  items belong, right?).  So we decided to do a taste test of Hormel, Oscar Mayer, and fresh.  Tracy heated up the two “fully cooked” products and then cooked some of the fresh bacon,  all using a microwave.   The results were very surprising.  Yes, the maple bacon beat the competition more decisively than Usain Bolt would beat me in a 100 yard dash.  We agreed that the Hormel product was awful, too thin, bad texture, and almost no flavor.  What was shocking was that the Oscar Mayer product was good.  Good texture, good flavor, good crispiness.  I don’t plan to buy fully cooked unrefrigerated bacon again (partially on principle, partially because bason is too salty to be a regular part of my diet, and partially because the amount of packaging from 2 ounces of bacon that will end up in a landfill is shocking).

So in the spirit of rethinking, I do tip my hat to these companies for staying in touch with what their customers want, and bravo to Oscar Mayer for making it yummy.

-Ric

Exactly why did Linkedin beat Plaxo?

I distinctly remember a conversation nine or ten years ago with a high school classmate of mine named Tom who now lives out of town, we were excahnging contact details, and I asked if he used Plaxo or Linkedin and he said he used both because they were about the same and his contacts were split among the two.  At that time, neither was clearly dominant in terms of users or functionality.  In fact, both were pretty klunky as I recall.

How times have changed.

Last week Linkedin went public and took off like a rocket ship and I didn’t see a single mention of Plaxo in the news.  These days I have over 600 contacts on Linkedin and I use it several times a week.  I can’t tell you the last time I logged on to Plaxo.  I am not sure I even remember my Plaxo password. 

What happened?

It’s pretty obvious why Facebook beat out Myspace (and lots has been written about that so I won’t re-hash that), but the last time I was a regular user of both Plaxo and Linkedin, no one was any better than the other in terms of features and function, and as far as I know Plaxo didn’t stumble in any big way (as Myspace did).   Was it just a tipping point?  Was it viral?  Was it the suggestions to re-connect with old friends (was Plaxo too passive while Linkedin got more proactive)? Was it the business services that Linkedin offers?

I don’t have a good answer, so I am really asking – send me your comments and feedback.

-Ric

To my knowledge the newly launched search engine Blekko is the first to have its own superhero (Blekkoman – on the left).

Buy that’s the only reason I like it.

I read this article by Damon Darlin and could not have agreed more with the basic premise of the company, which is that because search has proven to be a many billion dollar industry, any dent they can make in terms of attracting users will be worth a slice of the many billions, and with *only* $25 million in venture back, even a $100 million slice makes it a worthwhile bet.  Smart business.  You don’t have to win – you just have to be a little bit relevant to be in the game.

So I went out and tried Blekko on some things that I commonly search and I have to say, their results had much more relevant first page results than I ever get from bing or Google.  So from my subjective perspective, they are already on to something.

I also like Blekko’s blend of humans and technology where they combine the muscle of smart algorithms with a bit of dirt-under-your-fingernails human input by having “experts” rank the relevance of content (a la the Amazon Mechanical Turk, but with free wiki-like input, as Darlin explains).  I think this is some great rethinking and I bet Blekko has a very bright future at this rate (though there’s nothing to stop bing or Google from fast-following this approach).

Having said that . . . if I were a venture capitalist working with Blekko, I would give them some additional guidance.    While I think the use of slashtags (described in the article) is a very good way for us to improve our search results, if I really wanted to carve out a search niche, I would really focus on some top search verticals, such as healthcare and look to not just get a raw X,000 searches per day in the land of ComScore, but have it be industry/category specific.  Once you have established at least a toe-hold on a niche, that’s a lot more interesting and valuable to advertisers and that makes you a lot more interesting as an acquisition target.  Follow the money and the money will start to follow you.

I did already add Blekko as a favorite site, and if I continue to get better results, I will make it my homepage.  If I had to make early guesses on who should buy Blekko, I would think bing before Google, but Blekko could also license their model to specific industries, and I would think someone like WebMD would love to have better search, as one example of a less expected suitor.

-Ric

Uber is a cool new car service  that Jenna Wortham recently wrote about in this article for The New York Times.  Intersect is an equivalently cool new site that for all practical purposes is the opposite of Twitter that is all based on location and what is happening in a specific location at a particular time so it becomes a chronology of everything that happens at that location.  Their web site does a better job of describing it than I do. 

So what?  And what do these two totally different companies have in common?

I’ll get there, but it reminds me of something my friend Tom, who is an executive at Microsoft, was telling me a couple of years ago about modern phone technology (in this case the design of Windows Phone 7).  He pointed out something pretty obvious, but at the same time prettty incredible.  Historically with computer technology the size of the screen of the device software was written for was known and fixed.  Also, things like “up” and “down” were fixed.  Now with mobile devices like phones and tablets, we expect to turn the device upside down and have it turn the screen around for us, and if we want to change the amount of information in the screen, we are now able to pinch in and pinch out and slide – and we expect that.  That has been trasformational for mobile devices.

Back to Uber and Intersect.

It wasn’t so long ago that it was a safe assumption that when we were on the internet and using technology, that we were sitting down looking at a screen in a pretty knowable location, such as home, work, a coffee shop.  What has changed just in the last couple of years is that more and more of us use our mobile devices all the time all over the place, checking sports scores, checking to see if The White House is going to release the recent photos of bin Laden, e-mail, you name it.

So it shouldn’t be surprising that Intersect is taking that fundamental shift in assumption, and they are assuming they want to write about what they are doing wherever they are.  Foursquare makes a similar assumption.  Intersect takes a different tack and uses the location of the cars to determine which car is closest to the customer and then lets the customer track where the car is as  it gets closer.    The Intersect assumption is that everyone (in their target market) has a mobile device with location services and they then use that location information to bring together two people who don’t know each other, and who haven’t met, and who might never see each other again.  Location based supply and demand in real time.  That wasn’t possible  for the masses until very recently. 

It’s companies like these that are going to continue to transform the way we socialize and transact business and rattle core assumptions we used to have about how we get through our day.  It’s all opportunity for the entrepreneurs out there, and all risk for the established organizations that don’t take a step back and rethink what this means for them.

-Ric

My friend Mark at Level 11 Consulting just told me about Wordle and it’s really a great way to instantly create a visual image of data or as they call them “word clouds”

Here’s a Wordle of my first book, Rethink.

Give it a try.

In fairness, this issue isn’t limited to UPS, that just happens to be the source of my most recent bad experience with this.

What’s the shipping dinosaur?  SIGNATURE REQUIRED.

When you ship something to your workplace, it’s no big pain. The delivery person seems completely disinterested in who signs as long as they get a scribble on the wireless device they use to document receipt.  I get that, but it’s not really a very useful step in the process when anyone in your office can sign for something, whether they are your boss or a temporary worker you don’t really even know.

At home it’s an entirely different story. 

I recently ordered a birthday present for my son who will be ten next month.  The shipping organization chose to send the package “signature required” and didn’t give me any other alternative.  So when it shipped, I went online to track the package and checked every box there was to check to have them notify me via email when the package got closer to delivery.   In my limited experience, FedEx does a decent job of this going so far as to tell you when it’s on the truck to give you some idea of at least what day it will arrive.  In the case of the birthday present for my son, I got one alert, notifying me that it had left Hong Kong.  Not very helpful.

So the next day I get home from work and there’s a sticker on my door that they tried to deliver it and that they would be back the next day before 10:30 AM.  It just so happened that I had very important meeting at 9:00 AM that day and there was no way for me to be home at that time.  I called family,  friends, and neighbors and that time was bad for everyone. 

So why is this such a dinosaur?

In this day and age, when shipping organizations have satellites circling the globe, and we now have very mature GPS tracking technology, it seems that there ought to be a much better way for the shipping organizations to ask us if there are some preferred times to receive the package (the birthday is still three weeks away, so I was in no rush at all) and do a much better job of sending me messages about projected arrival time.  Moreover, even though I am not a huge fan of going to the UPS customer service building in South Seattle, I certainly would have preferred just going to pick it up there when it got to Seattle than work on blocking a two and a half hour delivery window that UPS was proposing.   After three failed delivery attempts they would have to sent it back to the shipping organization and that gave me some stress. 

To be fair, this isn’t limited to the signature required world.  Sometimes people order perishable things in the mail so it’s vital to not have a failed delivery attempt.  And this isn’t just FedEx, UPS, DHL and that crowd, this applies to the USPS as well.  The USPS comes to our houses six times a week.  That’s nutty if you stop and think about little of the mail we want (never mind the jumk mail we don’t want) is really urgent in the first place.  The folks at doxo have figured that out, but when you realize that there are probably a healthy percentage of people like me who are willing to go pick things up at UPS, and sometimes at the USPS, given the cost of gas and scheduling and resources, it’s a little hard to believe we haven’t already seen more rethinking in this area.

I did get the package for my son in time.

-Ric