Sunday, January 19, 2020

Innovating Pizza

Nobody is going to get rich by DISRUPTING PIZZA. Sure you can get rich setting up a new pizza chain. Appealing (whether good nor not) product, good branding, the usual thing. There is no TECHNOLOGICAL INNOVATION that is going to do it. What's it cost to make a pizza, Michael? NOT THAT MUCH! How much can you charge for it? NOT THAT MUCH!
SoftBank-backed Zume is laying off 360 employees, accounting for about 50 percent of its workforce, and shuttering its robotic pizza business to focus on food packaging.

We want to make pizza! Um, with a robot! OK here's eleventy zillion!

Oops weirdly we can't make money that way, so we're going to pivot to being the "Amazon of food" which means, "we are going to be worth eleventy zillion dollars for reasons and get gullible journalists to write it up."
But to Zume’s fans, just because it is easy to mock doesn’t mean there isn’t an opportunity there. For starters, preparing and delivering pizza pies made by robots to Silicon Valley diners isn’t even Zume’s main business anymore. The four-year-old company has largely pivoted to an enterprise model where it works with restaurants that have no storefront and prepare their food in shared centralized kitchens, or “cloud kitchens”; with delivery providers like DoorDash and Postmates; and with existing pizza companies to build a hub-and-spoke model for the entire delivery industry. The company has been trying to morph into a data and logistics provider, part of an effort by founder Alex Garden to become “the Amazon of food.”

That pivot is not widely understood by the jokesters, who wonder how Zume can compete with the Pizza Huts and Domino’s of the world in the $10 billion pizza-delivery industry. The food-delivery sector is riddled with sky-high customer acquisition costs, given weak consumer loyalty and rampant subsidies made possible by venture capital.
That last bit was written... a whole month ago.

There's always a "the critics just don't understand the brilliance" stuff coming from these guys, when, no, usually they do.

I think we're finally getting to the end of the era of "Campbell's soup, but with an app." Not sure what the next era will be!