Without argument, some Initial Coin offerings (ICO’s) are vague in business plan description, market relevance, technological fit and strategy for on-ramping, customer access (technology and service), customer acquisition, traction and service monetisation. This ambiguity around market fit, need and relevance may be as a result of a poor execution of the requirements of the ICO’s WhitePaper however, at times it is due to the omission of experience, recognition, investigation of competitive market, and examination of all or most of the above.
From time to time an ICO is introduced where the prospective ICO proposes a new solution to a mature and well understood problem. These new solutions are disruptive, but as they support a well understood footprint, their collective value proposition is a little easier to understand. They do not sell the task of creating a new industry from the demise and rubble of an older inflexible siloed architecture, but disrupt to the point of evolving an older industry into a new democratised ecosystem. These innovative ‘digital David’s’ offer a new way of doing things, under a new architecture of inclusion, transparency, democratisation and provenance, where new solutions offer new or speciated benefits, terms, synergies, participants and economies, giving new attractive outcomes to an already attractive industry space.
The Coze Value Proposition – redefining who sits at the seat of power
On initial reading of the WhitePaper the Coze value proposition seems axiomatic and very straight forward. The WhitePaper describes the value proposition as:
“…[sic] derived from the access and demand on the current hotel booking economy. A truly decentralized token, Coze is usable at the owner’s discretion across all crypto markets and within the Coze platform. For customers, the token can be used within the Coze platform to book hotels, spend in the rewards store, and redeem for cash. Hotels can serve customers with tailored rewards and offers, allowing customers to build a strong reputation. This will maintain and strengthen the hotel’s relationship with their guests.”
When thinking on the above paragraph I come to the conclusion that the content itself is strong however the meaning attributable to that content is overwhelmingly strong. There appears an enormous amount of information contained in this seemly straight forward paragraph and it is the potential of the paragraph’s meaning that excited me on my second and third read of the WhitePaper. So compelling is the paragraph’s potential for a redistribution of an industry’s ‘seat of power’ and so closely is this model aligned to similar businesses in other industries that I believe it deserves further comment, beneath.
Coze - defining the customer relationship in favour of the Hotelier
Found in an industry position of privilege, power and trust many OTA’s demand exceedingly high booking fees and charges. So excepted now is the fees and charges they are considered fixed costs meaning an underlying cost not considered, in many instances, changeable or actionable. Although OTA’s have been very good of putting ‘bodies in beds’ they have placed excessive strain on Hoteliers dwindling margins. Many in the hotel industry argue the OTA’s are commoditising the hotel industry, along standard offerings and set price points, with little margin left available for the Hotelier to uniquely customise, incentivise and maximise the standard of stay for the guest.
All of the best globe Business Management Courses uniformly teach, the customer relationship is paramount to today’s success, but more importantly, critical to the success of the business, tomorrow. Many organisations of siloed protection, business Goliaths, have been destroyed by a small, nibble, quick to develop, start-ups, ‘digital David’s’ who have intermediated themselves between the customer and the traditional gate-keeper.
It is Coze’s plan to redefine the customer relationship in favour of the service provider where the digital David intercedes for the value of the Hotelier, the customer and the industry alike, and disintermediates the OTA’s. Coze plans to do this by virtue of Platform architecture, BlockChain transparency and immutability, and expertise within the industry domain.
Platform, economics and addressable market
Start-up success is hard to determine. There are, I believe some, some rudimentary truths, which if planned for careful, can increase the likelihood of a successful launch and realisation of early traction. I believe the success of any BlockChain/Platform as a Service, service will come down to three important things. These are: (i) execution of the platform build, (ii) the health of the Platform Ecosystem economics, and (iii) the size of the addressable market. Let’s discuss briefly the three start-up ‘MUST-HAVE’S’ in respect of the Coze ICO.
In respect of execution of the platform build, intricate knowledge of the industry the start-up will support as well as disrupt is critical. Knowledge of BlockChain technology, in isolation, without learned knowledge of the OTA industry and hotel/leisure booking industry, will not be enough to ensure success. Although a business methodology is inspired by the traits of fairness, transparency and democratisation, a unique understanding of where the economies of opportunity lie in respect to that industry is of upmost importance. The Coze team, on the basis of their webpage, has a mix of expertise across the converged domains of BlockChain, OTA industry and hotel/leisure booking industry. A combination of these existing skill sets is critical to making the Coze service offer. Inclusion of a mobile application and wallet is critical to the ‘business matrix of success’ and the Team has correctly identified this ‘low hanging fruit’ as a service must-have. I look forward to commenting on this aspect of the Coze architecture specifically, in coming articles.
In respect of the health of the Platform Ecosystem economics, an easy understood value proposition towards the Hotel industry should precipitate some early adoption. Third party ecosystem vendors are also expected to join the ecosystem seeing token velocity grow at each addition, to the digitised ecosystem. Motivation for fee-less commission and no cost bookings together with other rewards and incentives will form the basis of growing a community based movement on the premise of removal, reduction or containment of costs and a redistribution of the value of the industry within the hotel industry ecosystem.
In respect of the addressable market, it is huge and growing. The Coze ‘defining footprint' is based on their strategy of placing the direct customer relationship back in the charge and control of the direct service provider, the Hotelier. There is also a larger, longer-term strategy of building a defining ecosystem of inclusion and participation around the hotel booking industry model. Also, access to great hotel offers, through 'immutable marketplace economics' appears to support the great economic opportunity for others to join the ecosystem with new services and value, not yet conceived. The potential for a widening of the opportunity footprint seems high.
Building a profitable small-market company is difficult and carries a great risk of failure.
Building a profitable large-market company is also difficult and carries a great risk of failure.
But the marginal risk in building a company decreases as the addressable market increases.
The growing value of Data defining future services growth
Data and its inherent value, is set to soar. The Coze value proposition gives the direct customer relationship back with the service provider, the Hotelier, away from the intermediary, OTA. This is particularly important for Hoteliers looking forward, wanting to become more than a commodity service provider and designer of their own destiny, as data is set to drive the new digital economy. This is a marketplace where mobility, flexibility, transparency and choice is ‘served up,’ just-in-time and exactly where it is required and at a value understood and transparent to the customer.
Via the unique Coze utility token (COZE) and platform architecture the Hotel industry shares in the service knowledge continuum. The coming together of customer, service provider, community and ecosystem participant enables the growing of a symbiotic relationship. With symbiosis new levels of customer understanding is achieved as the information paradigm is serviced beyond the borders of a single service towards an entire experience cognition. At this level of customer connectivity new services are born. These services are less prone to rejection risk as they represent a better informed marketplace and understanding of supply and demand.
This is illustrative of the new value distributive ecosystem model and is definitive of a democratisation of the Hotel Booking Industry and why the Coze offer will resinate with all who learn of it, use it, participate and partake in its shared and growing value.
The marriage of a Digital David (Coze) with a non-innovative Goliath (Hotelier)
Business relationships come in many different forms and are definitive of many different wants, expectations, hopes and outcomes. Success in business relationships is often a result of pairing the organisation, individual or company with the trait, skill, knowledge, ability or experience missing in their own organisation. One of the most sensible relationship pairing I have noticed is the bringing together of a nibble, flexible digital David with a traditional, inflexible, non-innovative Goliath. The collaboration of a hotelier with a nibble, flexible, fast to develop Coze, provides the cash flow rich Hotelier with a digital knowhow, previously missing. This relationship is symbiotic as the Hotel is allowed to focus towards its traditional competitive advantage while trusting there collaborator to provide the digital tools to ensure a new level of customer learning while ensuring revenue erosive aggregation and customer thefts are kept way from their front door.
Onramp to service use, value and participation, easy to conceptualise
Notwithstanding the technology, the intent of a fairer more transparent intermediating technology and fairer model of value redistribution around a large and growing industry, this is not an ICO where we, the ICO participant, will need to wait years before seeing real growth in the business indices that matter. These include (i) growing of a customer collaboration base (Hoteliers), (ii) growing a cash flow in terms of COZE token velocity, (iii) growing a customer user base supported by the COZE token, and (iv) growing new vertical market opportunities that make sense to the COZE platform and ecosystem business model.
Initially, customer acquisition ‘call to action’ will be provisioned to a number of demographic groups seen as early adopters. As a believer and supporter of community activism, the Coze Team will actively engage with the Coze community, seeking activism and evangelism. Collaborating Hoteliers will be empowered with digital tools enlarging and enabling the Hotelier to take control of their own domain in a manner that is cost effective and easy to administer.
New customer provisioning will be as easy as downloading a mobile app and registering for an account. Cryptographic complexity will be hidden from the user and although functioning in the background will not complicate the on-boarding of new customers seeking a direct relationship with the service provider again. Coze converges the ease of web services with the freedom of mobility together with an immutable record of transaction transparency via a “BlockChain” to deliver dis-intermediating, open, decentralised platform supported by a digital currency of fairness, inclusion and transparency and roadmap date for service launch is circa Q4, 2018.
Conclusion
Perhaps the Coze value proposition can best be summed up in terms of a reference to the mimic octopus and its ability to camouflage its body to appear as a poisonous sea snakes, thus being over looked and hence avoiding its predators. The relevance to Coze, in this regard, is via Coze’s simple to understand but perhaps easily overlooked multiple seeded value proposition. The value is inherent via (i) the current and growing industry value Coze is set to disrupt, (ii) strong value proposition for Hoteliers and customers alike, (iii) the Coze plan for disruption is arguably ‘corollary’ to what has come before it and therefore easy to conceptualise, (iv) strong desire to participate in an open and transparent system where participation and activism is rewarded and not ignored or taken for granted.
The Coze ICO is not about ‘boiling the ocean.’ It is about introducing a new ecosystem model seeing a fairer redistribution of the value within an industry, away from a siloed, secrete and protected service provider towards a model where the ‘BlockChain’ is used to redistribute participation value in an open, transparent and distributed manner. Arguably the Coze model represents the next revolutionary step forward, away from exclusive and secrete revenue models of the current aggregating OTA’s, towards a model where the Hotelier service provider takes charge of their customer, business and ecosystem for the benefit of their customer, their business and their ecosystem.
One thing I know for sure, Platform architecture and BlockChain technology is the atheist of banality and the status quo. If you want to support this Aussie born act of disruption, entrepreneurship and evolutionary change, while supporting a redistribution of value within the Hotel booking industry seeing value returned to the hotelier, customer and ecosystem participant, please support the ICO at launch.
Disclaimer
I am an experienced Senior Manager, Innovator and SaaS Entrepreneur, a BlockChain technology evangelist and enthusiast. I am proudly a SaaS/BlockChain adviser and contributor to the Coze Team. Please see my LinkedIn Profile here: https://www.linkedin.com/in/peter-reid-03503012
Reference:
https://coze.io