Jul
20
Most marketers know a push from a pull strategy. True to its name, a push strategy pushes a product the market has yet to demand. 3M brand Post-It Notes provide a great example. People the world over had no idea how badly they needed those little yellow stickies until they found themselves at wits’ end when their free, introductory supply ran out.
A pull strategy, no less true to its name, obliges markets with already-desired, that is, “pulled-for” products. While it’s easier to fill a known demand, learning what markets want is tricky. Ask any marketer who, after rave focus group reviews, introduced a product for it only to flop.
Digital products are of a necessity a bit of both push and pull. Technology heretofore unimaginable has no choice but to go looking for a market. Take, for instance, smartphones. In 2007, Apple had little luck pushing its newfangled iPhone on a market that demanded neither a touchscreen nor a device that was big and clunky next to sleek, miniaturized phones. Users began pulling only when Apple pushed out third-party apps. “That’s when the iPhone discovered that its killer app wasn’t the phone, but a store for more apps,” wrote Brian Merchant in his book The One Device.
Digital payments began as a push strategy. People liked portable devices and convenience at the point of sale, but it was unknown if they’d go for combining the two. The growth of point-of-sale payment systems must have brought a collective sigh of relief to early backers.
The gig economy pulls apps
The gig economy is pulling payments apps in a big way. Gig economy refers to work on a limited-time, non-employee basis. This can include temp workers, independent laborers, freelancers, babysitters, Uber drivers, handypersons, and the like. The gig economy has been around for as long as individuals have been charging for short-term work. What’s new is the way digital payments are solving the age-old problem of timely payment.
Companies that retain or broker gig workers usually pay by check and often take 30, 60, 90, or even 120 days to do it. Such delays can cripple the independent worker. According to a Pymts.com article by Karen Webster, 84.3 percent of gig workers said they would do more gig work—indeed, more than half have day jobs they’d cheerfully give up for full-time gig work—if payment were faster.
Solutions are fast emerging in the form of specialized apps that connect gig workers with eager customers while facilitating fast payment. Uber and Lyft, prime examples of gig economy apps, collect fares and disburse them almost immediately to drivers. Airbnb similarly collects and distributes rent. Bill.com lets businesses pay freelancers via the ACH, charging the latter only 49¢ per transaction instead of the more typical three percent. Amazon recruits delivery drivers and pays them via Amazon Flex. People blessed with strong backs can earn extra bucks moving furniture thanks to Bellhops.com. Independent homecare nurses, pet sitters, and childcare providers can collect via Care.com. Solo drivers let restaurateurs add delivery to their menu using TryCaviar. (The list goes on. A Wonolo article, where I found the foregoing examples, lists 50.)
$1.4 trillion
Since individual gig transactions tend to involve smaller amounts, it might be tempting to assume the gig economy is too small to pull the current profusion of apps. But small, individual transactions add up. According to pymts.com, American gig workers are headed toward racking up a good $1.4 trillion in 2018.
That’s certainly enough to pull more than a few apps.