Three Little Words Could Transform E-Commerce

No.more.streetnames

What3Words

Have you ever struggled to explain to someone exactly where you are?

U.K. startup What3Words is trying to make that problem a thing of the past. It has divided up the entire world into a grid of 57 trillion small plots of land, each associated with a sequence of three random words. 

So tourists in London can use "casino.coach.bikes" as shorthand for "meet me on the nose of the lion sculpture at the south-west side of Nelson's Column in Trafalgar square." The three words can be deciphered by anyone who uses the What3Words app.

While it's handy to precisely locate friends at a landmark or in a festival field, the app's real value lies in its ability to transform markets that lack the rigorous postcode system found in much of Europe and the U.S.

Inadequate Addressing

Some 75% of the world suffers from inadequate addressing. This  makes receiving goods bought online an exercise in wishful thinking, which hinders e-commerce penetration even in thriving economies. Similarly it makes getting aid or emergency services to the right people very difficult.

What3Words can provide precise addressing without having to wait for a state-run system to be developed. All users do is place a pin where they are on a map - online or on a mobile app - and it will deliver a three-word code that can be then used by the delivery company to locate that person precisely. It links, of course, to GPS coordinates, but uses an extremely simple and memorable mechanism to communicate them.

The app, which works offline, could help locate your tent or friends at a festival like Glastonbury
The app, which works offline, could help locate your tent or friends at a festival like Glastonbury
Photographer: David Goddard

 

Remembering Three Words

"Precise GPS coordinates would mean 18 digits," says What3Words' founder Chris Sheldrick, "but we wanted something that humans could actually remember. People have flawless recollection for three words. A dictionary of 40,000 words is enough to fill those 57 trillion squares with unique combinations - you can't do it any other way."

Because the naming system for the 3 meter by 3 meter grid is fixed, it can also be used offline with no data connection. Since it's also powered by an algorithm, rather than a massive database, the application is very lightweight - less than 10 megabytes. 

The startup has raised a total of $2.8 million in funding in three rounds: $500,000 (320,000 pounds) in seed funding from angel investors including Shutl co-founder Guy Westlake in 2013, and subsequent private rounds of $1 million and $1.2 million in 2014 and 2015 respectively. It's also signed up a number of partners including navigation app Navmii, Brazilian delivery franchise Carteiro Amigo, Norwegian mapping agency Kartverket and an African national postal service, which the company wouldn't yet name. Like other address look-up companies, What3Words takes a small cut for each address query made through its platform.

"One of the biggest issues we have is addressing," says Navmii CEO Peter Atalla. "In some places we don't have street names or house numbers - it might be '100 meters to the right of the Post Office'. But it's really hard to code for these things electronically."

Festivals and Favelas

In many parts of Europe Navmii will be pushing What3Words' capabilities at festivals, says Atalla, but it will have a much bigger impact in countries without addresses, such as parts of West Africa and Latin America. 

"Where addressing is really poor, it's a really nice alternative," Atalla adds. 

How the favela looks on Google Maps versus the complex, densely-populated reality
How the favela looks on Google Maps versus the complex, densely-populated reality
What3Words

Edwin Mugerezi from Tanzania's DigitalCity is involved in marketing the Swahili version of What3Words to people and businesses in East Africa. 

"Even in places where there are street names, they can often change due to political events, so one cannot guarantee that a physical address will be permanent," he says, adding that the response to the product so far has been "overwhelming". 

Carteiro Amigo is using the What3Words to map the Rio de Janeiro's Rocinha favela, home to around 70,000 people but lacking a clear addressing system. Google Maps only shows around 15 streets when in reality there are more than 3,000. The Brazilian Post Office has been trying to build up an address database manually, street by street, alley by alley, but What3Words can be used instantly by those living within the slum to receive deliveries.

Brazilian delivery company Carterio Amigo is using What3Words to give people in the favelas of Rio addresses
Brazilian delivery company Carterio Amigo is using What3Words to give people in the favelas of Rio addresses
What3Words

What3Words isn't the only company trying to solve this problem. SnooCode offers a similar service, but it's limited to Ghana. 

Sara Al-Tukhaim, director of Kantar Retail, agrees that the lack of addressing in emerging markets is "a big issue".

"In the Middle East, for example, home addresses are not the same as mailing addresses and most of what gets mailed to consumers either gets lost or takes forever to arrive," she says.

However, there are many other factors holding back e-commerce, she explains, including safety and security concerns, harsh weather environments and the prevalence of unreliable internet connectivity. 

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