Friday, August 2, 2013

Incremental innovation by Google: increasing power by new gmail changes

1. Apparently, a small change. Gmail inbox messages are now automatically allocated to three default tabs: promotions, social (from social networks, including google+) and primary (all the remaining messages: the most import ones for most of the professional people).
My own experience: great! And fewer concerns about opening non primary messages - including the promotional ones. I may get a look at the titles, but very rarely open anyone of them. Digital life quality has improved ... due to an (apparently) small change.

2. This is a typical incremental innovation by Google, that has implications for near half a billion of gmail users. Google basics is a disruptive innovation that gave Google a unique competitive advantage: free use for all, kindly paid by advertisers. I have discussed Google innovation in a recent paper (see here, chapters 5 and 6).
But sustainability of Google depends on a continuous flow of incremental innovations, not of a new radical changes. Small changes with impacts on millions of users. These are technological changes: technology changes when the object changes (the new gmail tabs), the way you use the object changes and consequently the "community of believers" do change. The change is positive when the "community of believers" increase in numbers or satisfaction, meaning additional value for users.
This gmail technology change is typical of all these changes.

3. Consequences may seem disastrous for advertisers. That could be argued to be dangerous for Google business model. FT Tech Blog has posted an interesting piece (here) with first data about the impacts of the changes. The implications are non linear: yes, people opens less promotional messages (see figure, from FT), but google spam filters are now less restrictive, and those users that that usually open promotional mails seems now to open even more messages. As summarised by one email intelligence company (cited by FT post):
  • The key takeaway here is that the people that matter the most to email marketers won’t read less email now. In fact, it’s likely they’ll read more.
  • Marketers may see a decline in engagement from less active subscribers, and if this group still drives a lot of revenue and conversions, then it’s likely marketers may have cause for concern. 
FT Tech Blog conclusion:
  • What is clear, however, is that Gmail, which has more than 425m active users around the world, is evolving constantly and marketers will need to adapt their strategies to keep up.
There another name for this: power, driven by apparently small, non disruptive, technological innovations. Google way to do business.