Product Ideas Newsletter #15

text analysis for small businesses, connecting Shopify to Amazon, and paying $500 a month for something like Stack Overflow

I took a little break, but now I'm back, and I'm not coming empty-handed. In addition to lots of new ideas, I've developed a new format for this newsletter.

It seems pretty obvious that people who subscribe to a newsletter that's titled Product Ideas are primarily interested in, well, product ideas. So starting with this issue, I'll provide more of that and cut out most of the rest.

Let me know if you liked the old format better or if there's anything specific you'd like to see more of.

Creative Opportunity

In the last issue I introduced a framework to come up with product ideas. (Try it here.)

Since then, I've used it myself with a little twist:

  • I made a list of products and services I use regularly and what I pay for them.

  • Then I asked myself: what would they need to offer to justify a 10x or 100x price point?

For example, I regularly use Stack Overflow and currently pay exactly $0 to use it. So what would a $5 a month, $5 a month, or $500 a month Stack Overflow look like?

At $5 you could maybe get rid of the ads and introduce some pay-to-win like features. Far more interesting are the higher price points.

What could make paying $50 or even $500 a month for a service like Stack Overflow a no-brainer for me?

First, it would be possible to get better answers much faster, if experts who participate would actually get paid for their time. Secondly, asking questions is currently a far from frictionless experience.

So I would happily pay $50 per month if I could just ask my questions in an otherwise silent Telegram channel and get quality answers in a matter of minutes.

At $500 per month you naturally have to be a bit more creative to justify the price. But luckily, in the investing industry there are several pricey "expert networks" like Tegus one can learn from.

Imagine the following: you have a special shortcut that launches immediately an IM or phone call with a relevant expert. That definitely would be worth $500+ a month to me. Of course, I could just hire someone on Upwork or Codementor for every single problem. But there is just too much friction in the process. You need to write a job description, vet the applicants etc. So oftentimes I end up not getting any help even though I know that I could probably save a lot of time and frustration that way. In particular, the problems I'm struggling with span many areas so hiring just one expert that's always available wouldn't do.

If you want to get really fancy, you could even think about a custom keyboard for knowledge workers or programmers similar to what Bloomberg is offering for investors. A noticeable feature is the "Help" button. If you tap it twice, you’ll get launched into an instant IM or phone call with someone at Bloomberg 24/7.

Unloved Product Opportunity

While there are many arguments for running your own Shopify store, it's undeniable that Amazon is king when it comes to driving e-commerce sales. 54 percent of product searches are now taking place on Amazon.

So, what if you could just use the best of both worlds? Manage and sell your products using Shopify but list them simultaneously on Amazon. The Amazon channel app by Shopify promises to do just that. Given that there are 180 reviews, demand seems to be high. However, the average rating is currently just 1.4 out of 5 starts.

Users complain about a lack of features, missing support, and that it often does not sync accurately. Oh, and on top of all that, it's priced relatively high with $39/month.

Now there are a few competitors that seem to do a better job. For example, Google, Amazon & eBay Cloud by Codisto starts at $29/month and seems to be working reasonably well. A similar alternative is Koongo which is a bit less popular but also seems to get the syncing between Amazon, Facebook, eBay or Google Shopping, and Shopify done.

However, none of these competitors focuses exclusively on the Amazon ↔ Shopify connection and hence they only include the most basic features. Many of the features that users of the Amazon channel app complain about simply don't exist in the multi-purpose tools. Hence, users who want to do a bit more than just cross listing their items, seem to be stuck with the barely working Amazon channel app.

A Shopify app that focuses just on syncing between Amazon and Shopify and really nails the interplay between the two therefore seems to be an opportunity worth looking into.

Downmarket Opportunity

While everyone's talking about GPT-3 there many companies that silently make bank which much simpler machine learning products. Monkeylearn is one of them. Founded in 2014, it's estimated that they currently make around $5 Million per year with just a handful of employees.

They specialize in text analysis. Their tools are used to analyze text from things like emails, chats, web pages, documents, tweets etc and the promise that it turns them into actionable data and helps in automating business processes. Their algorithms are able, for example, to extract the topic, aspect, intent, and sentiment from a given piece of text. In addition to out of the box models, they also offer users to train models themselves on their platform.

One big use case is customer support. Using the tools provided by Monkey Learn, support tickets can automatically be tagged based on topic, issues, intent, sentiment. Another use case is extracting insights from customer conversations and product reviews. But Monkey Learn's tools are intended as general purpose tools, and they're used in all kinds of applications.

I've played around with their tools and they indeed work quite well. Users rave about the great user interface, the many integrations and helpful documentation, how easy it is to use, and their extremely helpful support.

So what's the catch? Well, their plans start at $299 per month. And that's just for the API. If you want to use their nice user interface, you have to talk to their sales team first. So it's safe to assume the price is even higher.

It's hardly surprising that they are primarily focused on big customers, given that they've raised millions in VC money. But it also means that there is a huge opportunity to build a niched-down alternative that's available for $29 per month.

Existing competitors like Rapid Miner are even more pricey or like Amazon Comprehend much less user-friendly.

Instead of trying to build a general purpose tool, you could focus on one specific use case. For inspiration read the customer stories on the Monkey Learn blog.

Oh, and the best part is that you don't have to reinvent the wheel to compete with their ML stuff. Just spend a day playing around with what's available at Hugging Face, and you'll understand what I mean. Alternatively, you could start by building a user-friendly wrapper around a service like Amazon Comprehend and basically do a little bit of API arbitrage.

👋 End Notes

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