Here’s an idea for an App that has tremendous viral potential:

Elevator Pitch:

A Mobile App that pushes out images of luxury fashion products and if you guess the same brand right 5 times – you receive a discount promotion from that brand.

The app could be expanded to include: automobiles, electronics, hotels, experiences, etc.

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Here’s a venture opportunity I shared with several Silicon Valley venture capitalists such as John Doerr starting early August, 2013. Don’t be surprised if this functionality shows up in Facebook soon.

DeeeSire!

What’s the Social & Psychological Context for DeeeSire?

Uncertainty is a certainty…more than ever before.

Whether we admit it or not, there is anxiety, doubt, and trepidation in virtually every aspect of our lives.

Despite enormous freedoms enjoyed by us today, an inescapable sense of lack of control pervades over our affairs. This is an endemic affliction (and sign) of our times. Our fate increasingly seems to be shaped by other people’s motives. As a consequence, we seem to be living in a “high-beta” world – where anything is possible.

We can gain a tremendous amount quickly; we can lose it just as quickly as well…infact, in the blink of an eye.

Freedom from uncertainty is what we all crave: in our personal relationships, in our workplace, in what we buy, in what we get, in how we’re served, in how much we pay for things, and so on.

We seem to want, perhaps quite understandably, more control over own affairs…our own desires.

We are exposed to scores of messages to tickle, stimulate – even provoke – our impulses and our desires…from the moment we wake up to the moment we go to bed.

We say to ourselves: I need, want, wish, crave, covet, desire…tens – even hundreds – of times a day.

We yearn for our “desires” to be fulfilled in a context where we have freedom from uncertainty. We want greater control over the process of fulfilling our desires.

In essence, we want to consume and experience — without uncertainty, ambiguity, judgment, or fear.

What’s the DeeeSire application’s concept?

Along comes DeeeSire ™.

Imagine an application that allowed all the products, services and experiences you ever “desired” to be aggregated in one place – and accessible to you (and your chosen ones).

You would have access to your list of desires – DeeeSire List ™ or D-List – whenever you want and however you want – and they could be fulfilled at your desired price.

You control what goes on to your DeeeSire List ™ or D-List™.

You control who can view your D-List.

Vendors, who make the cut on your DeeeSire List™ or D-List™, would be made aware of your “DeeeSired” products or services. They could, then, send you personalized offers based on your D-List preferences.

Friends and family can select and purchase gifts for you from your D-List.

Never again will you have to settle for what comes your way – inadvertently.

You decide what you want, when you want it, how badly you want it, where you receive it, and at what price.

Without ambiguity, guilt, anxiety, or reservation.

In a world where you seem to have little control, with DeeeSire, you will have total control…over your desires.

What underlying needs, wants, and motivations does DeeeSire address? What’s the opportunity here?

Scenario 1: Direct (Business-to-Consumer) Online Relationship

You are at the Lacoste online store, and you like the new ‘Baltique’ blue shade of their regular fit polo shirt.

You click on the D™ button embedded on the Lacoste site, and voila, the ‘Baltique’ polo shirt is updated on your personalized DeeeSire™ list or D-List ™.

Now Lacoste knows that you “DeeeSire” this precise polo shirt.

You are a qualified buyer for that polo shirt.

If Lacoste wants to induce a purchase – they can send you a $20 off coupon to get you to complete the purchase.

Summer is coming to an end, Lacoste’s Fall/Winter collection is about to arrive. So, Lacoste thinks it is smart to go ahead and send you the $20 electronic coupon. Since these classic Lacoste polos never go on sale, you believe it’s a good deal – and you click “Buy.” Transaction completed.  DeeeSire gets 5% of the transaction value.

Scenario 2: Indirect (Business-to-Friends & Family) Online Relationship

Here’s another scenario: You have granted ‘view only’ access permissions of your D-List™ to your girlfriend.

Your summer vacation to the Caribbean island of St. Martin is coming up.

You have been thinking about picking up those cool Kenneth Cole ‘Pass the Bar’ loafers in ‘Taupe’ shade. They are on your “unfulfilled” DeeeSire List™ or your D-List ™.

Since your girlfriend has access to your “unfulfilled” D-List, she knows exactly what to get you as a gift as you both get ready for vacation (tickets and hotel for which, by the way, you had booked off your girlfriend’s D-List through Kayak.com).

DeeeSire gets 5% of the transaction value from Kenneth Cole for “fulfilling” an “unfulfilled” item on your D-list.

Scenario 3: Direct (Business-to-Consumer) Online Relationship – coupled with Mobile Enablement

(Note: This Scenario will be part of DeeeSire’s Phase 2 Development Cycle)

The other day you popped in to the Bang & Olufsen store at Stanford Shopping Center. You really liked this new BeoPlay A3 iPad Dock. You were curious about the product but were in a bit of a rush.

You figured, “let me scan its bar code through my iPhone DeeeSire app to add this product to my D-List™.” You’ll check out its specs online later; think about it some; and then consider buying it.

Later, as you browse through your D-List online, you spend some time reviewing the product specs at leisure, and you come to the conclusion that the product is fantastic: “Got to have it!”

Now that the BeoPlay A3 is on your D-List, Bang & Olufsen is interested in tipping the scales, i.e. “sales” in their favor. B&O sends you a 1-day limited time offer of 10% off the list price if you complete the purchase within the next 24 hours. You think, the deal’s too attractive to pass up. You click “Buy.” DeeeSire gets to keep 5%.

Scenario 4: Hybrid (Business-to-Friends & Family) Relationship – coupled with Mobile Enablement

(Note: This Scenario will be part of DeeeSire’s Phase 2 Development Cycle)

Your Mom’s birthday is coming up in a week. You live in Palo Alto. She is in Boston. You can’t be with her on her birthday this year but you do want to make sure she does have a very special day on her birthday.

Your Mom likes the timeless shopping experience of touching and feeling the things that she chooses to buy.

On her previous visit to the Hermes store, she had scanned the bar-code on a gorgeous scarf through her DeeeSire app on the Android-run Samsung Galaxy smart-phone. The Hermes scarf is now on her D-List™.

You know from her D-List that she’s been coveting this scarf. Being the good son you are, you click ‘Buy’ with a personalized birthday message and Hermes takes care of the rest. DeeeSire gets 5% of the transaction value.

You also know that she likes to treat herself with the occasional trip to her favorite spa at Mandarin Oriental.

The spa’s ‘Oriental Harmony’ treatment is on her D-List as well.

You go ahead and buy her this spa treatment, and DeeeSire gets 5% of the transaction value.

Scenario 5: Content meets Commerce

As you browse through the iPad edition of The Economist magazine, you notice that His Majesty’s agent James Bond 007 (Daniel Craig) is sporting a rather attractive new Omega De Ville Hour Vision watch.

You are most intrigued. You click on the watch, and an option pops up for you to add the watch to your ‘D-List™.’

The moment the watch is added to your D-List, Omega sends $1 to DeeeSire as a ‘Finders’ Fee.’

Based on the data we have on you on the back-end, we know you can’t resist a good deal – particularly if there’s free shipping involved.

Big data at play: As part of our arrangement with all our vendors (including Omega), our automated system triggers a ‘bespoke’ offer based on certain algorithms (on behalf of Omega) with a 10% discount off the sticker price. Sure enough, you end up clicking ‘Buy,’ and DeeeSire automatically generates 5% of the transaction value and Omega does the order fulfillment.

What’s DeeeSire’s Value Proposition again?

DeeeSire will be a retail industry game-changer.

For the consumer:

1. DeeeSire makes the retail market more efficient by giving the consumer the power to aggregate and sort all their “DeeeSirable” products and services in one place.
2. DeeeSire allows the consumer to merge off-line and on-line shopping experiences into one seamless whole.
3. With DeeeSire, never will a gift need to be returned or “re-cycled” again. With access to your D-List, your loved ones, friends and family know precisely what you want.

For the vendor:

1. DeeeSire is providing “qualified customers” for specific products (SKU’s).
2. Moreover, DeeeSire has an adaptive engine that processes your purchasing patterns to generate ‘bespoke’ offers that are beneficial to you (and too hard to resist) as a consumer – thus “closing” a sale for the vendor.
3. Through DeeeSire, the vendor has specific and potent power to induce and shape buyer behavior on a real-time basis by offering advertising and promotional offers.
4. Finally, with DeeeSire’s data set, a vendor can gather invaluable data on preferences and purchasing patterns in real-time with a view to inform its operations (product design, demand-planning, supply-chain, procurement, and merchandising functions).

What’s the DeeeSire Ratings & Classification System for the products you put on your D-List?

Your DeeeSire or D-list will have a 3-level product/service rating system (in order of intensity):

1. Love; 2. Infatuation; 3. Curiosity.

Your D-list will be broken into:

1. Fulfilled DeeeSires; 2. Unfulfilled DeeeSires.

You can set your privacy settings such that certain product/service ratings are accessible to all users within your DeeeSire network; others have limited access; and yet others are entirely “private.”

What’s the natural tie-in of DeeeSire from a community-building perspective of the Social Web?

The process of your friends and family adding a product, service or experience to your D-List would be coined as DeeeVoting ™ and these “voting” DeeeSire users would be called DeeeVotees ™.

What’s the Target Market DeeeSire is addressing?

The target demographics is virtually everyone who has a desire and can use the application – either on a PC, or a tablet or a smart phone. The demographics are literally as wide as: 10 to 80 year olds.

What are the Revenue Streams for DeeeSire?

Revenue Stream 1: Commissions

At its very core, the revenue model is built on referral business: 5% of all transaction values.

Revenue Stream 2: Finders’ Fees

In addition, each time a user clicks on the ‘D™’ button against a product or a service anywhere on the web, DeeeSire gets a flat “customer finders’ fee” of $1.00 or $.50 or $.25 per click from the relevant vendor for qualifying a customer for that product or service.

How much we can charge per click will be determined by the propensity of vendors to pay for qualified leads that we generate for them.

Revenue Stream 3: Advertisers’ Bespoke Offers

Based on your D-List™, advertisers (vendors) can send you bespoke offers for which DeeeSire will charge the advertiser on a per offer/impression basis.

For example, you have a pair of faded blue Diesel ‘Zatiny’ boot-cut jeans on your D-List.

Now, our system algorithm senses that you haven’t yet tried the rival designer jeans brand ‘7 for All Mankind.’ Given your purchase history, DeeeSire knows you would be a lucrative customer for ‘7 for All Mankind’ to snag away as a customer. So, DeeeSire sends a 7 for All Mankind $25 off bar-coded notification that you can redeem through your smartphone at a physical store or online.

For our effort, 7 for All Mankind pays DeeeSire a fee per bespoke offer. So, we charge $2 per bespoke promotional offer we “push” out to our users and 5% of the value of the transaction, should a transaction get completed through our promotional offer.

Revenue Stream 4: Consulting Fees

DeeeSire would delivering consulting engagements to its vendor base on customer preferences as the vendor would get invaluable insight from DeeeSire’s data analytics team.

How does DeeeSire integrate with Amazon, Facebook, Ebay, and specific vendor e-commerce sites?

In the Facebook newsfeeds, the ‘D™’ button will be embedded against all “sponsored feeds.”

For example, rather than just clicking “Like” against the Haagen Dazs Belgian Chocolate sponsored feed, now you could click the ‘D’ button to put the item on to your D-List™.

Same concept would apply to products listed on Amazon.com or eBay or a variety of other e-commerce sites.

Similarly, on vendor sites, the ‘D’ button would show up against specific SKU’s as well.

For example, you’re on the Ralph Lauren website, and you “DeeeSire” to purchase a pair of their Suffield Chinos in ‘Dark Sage’ shade. All you have to do is to click ‘D™’ and you will be asked for access permissions by DeeeSire. Once you’ve signed in using your DeeeSire (or Facebook login), the item will now be on your D-List.

What are the critical success factors for DeeeSire?

Simplicity, ubiquity, and adoption would be the two critical success factors for DeeeSire.

Simple, minimal and beautiful design of the user interface.

Ubiquity of the DeeeSire app and the ‘D’ button on various vendor sites.

Widespread adoption of the DeeeSire app would be critical for DeeeSire to build a sustainable business.

What distribution channels will be available for DeeeSire DeeeVotees™?

Phase 1:

The DeeeSire app will be launched for the web interface and for Apple, Google-Android, and potentially, the Microsoft tablet as well as smart phone ecosystems.

DeeeSire embedded apps would be created for Social Media platforms such as Facebook as well.

Phase 2:

In addition, during Phase 2 of DeeeSire’s evolution, users will be able use the DeeeSire app on their smart phones for scanning barcodes of items at select brands, and be able to add those items to their D-List.

How much seed money does DeeeSire require?

To begin with, there are costs to develop the website, the mobile app, and various tablet apps.

Then there will be costs to sign up various multi-brand e-commerce retailers as well as specific branded vendors.

DeeeSire will need to have a pervasive (if not a ubiquitous) presence across the web among the larger retailers with its ‘D™’ button embedded among all major online retailers and vendors – say with an initial target of 100 of the top ecommerce websites. Hence, the business would require seed-stage capital commitments of at least $5 million.

What’s the projected revenue trajectory for DeeeSire?

Quarter	Q1	Q2	Q3	Q4	Q5	Q6	Q7	Q8
Revenues ($)	100,000	500,000	1,000,000	1,750,000	3,500,000	5,500,000	10,000,000	20,000,000
Costs ($)	250,000	400,000	750,000	1,250,000	2,250,000	3,250,000	5,500,000	10,000,000
GM ($)	-     150,000	100,000	250,000	500,000	1,250,000	2,250,000	4,500,000	10,000,000
GM %	-150%	20%	25%	29%	36%	41%	45%	50%

What’s the projected break-even point?

One year from the start of operations.

Who could be useful Strategic Partners and/or Investors for DeeeSire?

• Luxury and Premium Brands:
• Big Box Retailers: Given the depth of their understanding of consumer behavior and the sophisticated retail technology available to them, big box retailers’ technology divisions would be very handy. The strategic partners that come to mind are: Carrefour, IKEA, Wal-Mart, and Target.
• Search Engines:
• Social Media:

Who do we expect as investors in various financing rounds?

• Seed Round: Angels and Early Stage VC’s, and Social Media and Search Engine giants.
• Series A, B, C, etc. Rounds: VC’s and Strategic Investors.

What’s DeeeSire’s Exit Strategy?

IPO or acquisition within a 3-year window to someone like Google, Microsoft, Facebook, eBay, or Yahoo! – companies that are trying to build a clear leadership in the Social Commerce sphere.

What kind of founding team will be required?

• CEO & VP Strategy & Business Development – Sahil Alvi
• CIO/CTO – TBD
• COO – TBD
• CFO – TBD

To recap, what are the key takeaways about DeeeSire? What problems does it solve?

With DeeeSire: you – as a consumer – are absolutely free. You are in complete control…of your desires.

The problem DeeeSire solves:

1. Monetization of Social Web;

2. “Qualified” lead generation for online vendors;

3. Instant Gratification for e-commerce customers;

4. Unprecedented efficiency in gift-giving.

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Here’s an idea for Toblerone — the beloved Swiss chocolate brand of tens of millions of chocolate lovers all over the world.

Imagine a Toblerone bar whose signature chocolate triangles change in flavor from one triangle to the next across all of their four delightful options.

For example:

Triangle 1: Milk

Triangle 2: White

Triangle 3: Fruit & Nut

Triangle 4: Dark

Triangle 5: Honeycomb Crisp

And the sequence would repeat itself.

This new Toblerone could be branded as ‘Toblerone Blend.’

Imagine “all four flavors in one!”

Image Courtesy: Kraft Foods

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Volkwagen Group (ADR:VLKAY) or (ETR:VOW) is the most dramatic growth story of the automobile industry in the last half a decade.

With growing brands across a range of incomes brackets and geographic markets: Bugatti, Bentley, Lamborghini, Audi, Volkswagen, Seat, Skoda and Scania — the Volkswagen Group has a largely complementary portfolio of brands. These brands account for 198 models — something to please and satisfy most every customer on every continent in the world.

Of course, Volkswagen AG also is part-owned by the quintessential German sports car brand: Porsche. This relationship allows for a significant number of R&D, Product Development and Procurement synergies between the two companies.

The company has delivered a 12.4 percent rise in vehicle deliveries in first ten months to 5.98 million vehicles. The group delivered record number of vehicles in October, 2010 (growth of over 9.8% compared with the market’s 4.5%). That is twice as much as its industry peer group.

Audi: Vorsprung Durch Technik

The group’s premium brand, Audi, has demonstrated a growth rate of 16.4 percent year-over-year by delivering around 916,900 cars around the world between January, 2010 and October, 2010. It is well on its way to crossing the much vaunted ‘million vehicle’ mark by the end of this year. In high-growth markets like China and Asia-Pacific, the brand has seen blistering growth rates of 55.7% and 49.3% respectively (please see chart below courtesy: VW Group).

The group has announced a massive €51.6 billion investment drive for its automotive division over the next 5 years — investing a large portion of that sum in environmentally-friendly technologies. Four-fifths of it will be invested in property, plant and equipment helping it modernize its production capability and expand its turnover capacity. The company’s Chinese joint ventures will invest an additional €10.6 billion between now and 2015.

Infact, with their new planned investments, the group has a stated goal to surpass Toyota as the world’s largest manufacturer of auto-mobiles.

As of end of November, 2010, the group’s stock is trading at a multiple of P/E multiple of 12 compared with its peer group  that is trading at least a third of the way higher:

• Daimler (ETR:DAI) is trading P/E of 17.5;
• BMW is at P/E of 17.7;
• Toyota (TYO:7203) is at P/E of 18.6.

When I  first allocated the VW ADR to my simulation portfolio on Sept 10, 2010 it traded at US$ 19.71. As of close of trading on Nov 26, 2010, the stock is trading at $28.39.

That is a 44% return over two and half months.

Thanks to its rising brand strength and market penetration in the world’s fastest growing automotive markets, I believe there is plenty of growth in both the fundamentals of the company and its stock.

Disclaimer: The author owns no stock in the Volkwagen Group. He does, however, drive a Volkwagen Touareg and previously has owned a couple of Audis and stands by their build quality and performance.

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Once upon a time there lived two orange farmers in sunny Florida.

They were called: Jack and Steve.

They both were friends, came from the same town, similar age, socio-economic background and skill set.

They both worked hard for their co-operative. They both were hungry to progress in their line of work. They both were ingenious in the way they approached their work. But there was ONE vital difference between the two: Jack and Steve had completely different outlooks on business.

Jack was good at ensuring every last drop of juice was squeezed out of the oranges he used for their co-operative’s juice-making facility. However, Steve was more intrigued by the idea of how he could produce more oranges and sell them to new sets of customers in different product formats and through wider distriution.

Jack continued to come up with innovative ways to squeeze out the last drop of juice in the oranges that were grown in their co-operative’s orchards. It gave the orchard a handsome 10% increase in juice yields.

Steve, on the other hand, had no immediate results to show for his efforts in experimenting with crop yield improvement techniques.  He tinkered with new innovations in how his co-operative’s oranges could be used in other products and categories — food & beverage (non-carbonated drinks, soda, candy, etc.) and personal care (soaps, facial creams, etc.), among others. He even engaged with new distributors from across the pond in Europe to sell more of his product. All of these efforts amounted to very little as most of these initiatives resulted in marginal marketshare gains but significant expenses over the short-to-medium term.

While Jack was delivering measurable “results,” Steve was been criticized and chastised for apparent lack of pragmatism and bottom-line results.

But one fine day, Jack realized he had reached the limit of squeezing every drop of juice available in an orange and could go no further. Meanwhile, right about this time, Steve’s non-fizzy, special orange and mixed fruit juice blend began to take off. Over the next few quarters, the drink gained national popularity.

In that year alone, sales went up by 35% and margins approximately: 20%. And there seemed to be no stopping the popularity of the drink — which a major beverage company was interested in licensing for US$ 300 million for an exclusive, multi-year agreement to produce and distribute the drink. This would be 10 times the annual US$ 30 million turnover of the entire orange co-operative and 100 times greater than the US$ 3 million extra margin improvement that Jack had painstakingly operationalized by improving juice yields from their orange stock.

Moral of the story: Yield management and cost reduction have their logical limits. Growth and diversification, on the other hand, is only limited by the resourcefulness and creativity of the people involved.

What company are you?

Jack — the cost-squeezing innovator with a natural limit to your value creation capabilities…or Steve — the relentless strategic innovator with boundless value creation capabilities.

What is your outlook on business…and life?

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