Well, this week, after reading the "Secret of Googlenomics" (twice), I decided to focus on Google...
We saw in the Breeze session that digital advertising only accounts at this point for 16% of all advertising spend. Of that 16%, 55% goes to Google, and 75% of all advertisement $ goes to search-based ads, not display ads. Search-based ads are were Adwords comes in, as Adwords generate 98% of revenue at Google, says Eric Schmidt, Google CEO.
The Secret of Googlenomics
The highlights of the article for me were the following:
1. "Anything that increases Internet ultimately enriches Google"
2. "Selling ads doesn't generate only profits; it also generated torrents of data about users' tastes and habits..."
3. Revolutionizing ads pricing by using the second-price auction model - Like the folks at Heineken would say, "Brilliant!"
4. "The bids themselves are only a part of what ultimately determines the auction winner." Whether it is fair or not (see Not everyone's a fan of Google), Google supplements the bid with a "quality score" which is determined based on the relevance to specific key words, quality of the landing page, click throughs and other things. Theoretically, this should be a win-win: the users finds what he is looking for, the advertiser realizes a sale. Does this give Google too much control?
Not everyone's a fan of Google
In his post on TechCrunch titled "Why advertising is failing on the internet" Eric Clemons ascribes Google's business model to "misdirection." He writes: " Misdirection most frequently takes the form of diverting customers to companies that they do not wish to find, simply because the customer’s preferred company underbid." This is certainly a risk, and this concern is likely one of the elements fueling the anti-trust charges Google is facing.
Google and Daily Deals Models
Another area Google has toyed with is partnering/competing with Groupon, or the "499" Groupon copycats as Andrew Mason reported to Matt Lauer this past January. Indeed, the business model is very easily copyable, and many have. I was intrigued, and googled the key words "Google Groupon." I uncovered some interesting information. The first link I followed talked about the launch on July 19, 2011 of a "new deals platform" " named "Link, Like, Love" powered by American Express and Facebook. You link your Amex account to Facebook, register for the deal, and the deal appears on your credit card bill in the form of a credit. (http://techcrunch.com/2011/07/19/160-year-old-american-express-out-innovates-google-and-groupon/) . Another link I clicked was a blog post on Wired.com introducing Google Offers, Google's daily deal site, in April 2011. (http://www.wired.com/epicenter/2011/04/google-groupon-2/). The battle is heating up. It appears all these websites are still primarily focus on large urban areas. The areas closest to me served by Groupon are Springfield, MO, about 70 miles East on I-44, and Tulsa, OK about 100 miles West on I-44. And yes, I signed up...
Google in the words of its CEO
The interview of Eric Schmidt by Charlie Rose was very interesting, though the link ended a few seconds past the 19 minute mark... I also decided to explore the Google website a little. I stumbled upon the Adwords new-user training video, where it explained a lot of the same things Schmidt and the article shared about how it works, and how to set it up. I'm finally starting to understand...
First, I thought it was very interesting that Charlie Rose's line of questions paralleled somewhat the summary of findings of the "Future of the Internet III" by Pew Internet and ALP we saw last week. Schmidt agreed that "the mobile device will be the primary connection tool to the internet." In our lifetime, and I paraphrase, he recognizes that we've gone from a world of zero communication ability to nearly 100% communication, from zero access to references to access to nearly every resource ever created. Spotify claims that it gives us access to every song ever recorded... He also touched on the role of transparency, and the world's increased transparency in consequence of the development of the internet. I liked his joke about working on a Politician BS Detector, cross-referencing anything they've ever said for consistency... He also addressed what his intellectual property philosophy/model is, which is also one of the issues raised by Pew and ALP. his stance reminded me of Pandora's Tim Westergren, where the royalties would flow straight to the right holders, on a per unit basis.
Second, Schmidt discussed Google on a more societal level... He recognizes the proliferation of user-generated content, which we talked about in a previous blog. He sees this content generation as a "defining expression of humanity." He came back to that when later in the interview, he discussed the turn the internet and media in general is taking to make our experiences more "personal." As more and more elaborate models are created to understand us, at the individual level, the more spot on the advertisement is likely to become. Ads will be less and less an annoyance, more and more a help in finding what we are looking for. As Levy writes, Page and Brin "also believed that ads should be useful and welcome - not annoying intrusions."
Finally, one cannot talk online business models without trying to figure out the monetization piece. Schmidt describes a very simple tiered model, based on page views. He proposes that 2 billion+ views should use ads to generate revenue, 2 million+ views should use micro-payments (a few cents per view), while highly specialized sites ought to use a subscription mechanism. He does not give any details on how this would work, and the logistics behind a micro-payment model seem daunting...
All in all, this week has allowed me to become more familiar with Google, and the impact it has on the internet. I do hope Schmidt is wrong on at least one point, namely that "great entrepreneurs break out early."
Saturday, July 23, 2011
Saturday, July 16, 2011
#501 - Week V - Part II - The Future of the Internet
The Pew Internet and American Life Project have produced their third and most recent report on the future of the internet in 2020. They surveyed Internet specialists and analysts, proposing a variety of scenarios, and assessing their responses.
I will go over the 8 scenarios proposed, and in one or two sentences describe why I do or do not agree with it, and compare that to the prevailing thought. I'll formulate my opinion before looking to see how the experts felt.
1. The mobile phone is the primary connection tool for most people in the world. Whether it is a phone, or another mobile device, this seems inevitable. The increase in computation power of these devices alone makes it likely that they'll be able to meet the needs of most. 77% of the experts also agreed
2. Social tolerance has advanced significantly due in great part to the internet. I'm having a hard time seeing a strong relation there. To the contrary, the internet could be a way to anonymously associate with people of like persuasion, and exacerbate intolerance. Only 32% agreed, while 56% disagreed.
3. Content control through copyright-protection technology dominates. I do not see that happening either. I believe as user-generated content continue to grow, the power of collective knowledge will dominate, and that we will see less and less copyright-protection sought. Once again, 60% of experts also disagreed.
4. Transparency heightens individual integrity and forgiveness. No doubt on the first one, as I believe it is already happening. I find it incredibly arrogant for celebrities or politicians to misbehave and think they can get away with it in this day and age. I would love for forgiveness to be on the rise also... Experts are split, 45% agreeing, 44% disagreeing, mostly citing wrongful accusations, and the need to rebuild one's wrongly tarnished reputation... not convinced.Wiener is one example of the former. When it comes to the latter, maybe, The jury is still out on IMF's DSK.
5. Many lives are touched by the use of augmented reality or spent interacting in artificial spaces. I guess this is where the movie "Surrogate" comes in. Great movie. That extreme will not be here by 2020, but I can see this as being appealing to many. So I think the idea valid. 55% of experts agree.
6. Talk and Touch are common technology interfaces. I think of all the scenarios so far, this is the easiest to see coming to reality very soon. Touch for sure will be the primary means to control interfaces. The days of the mouse are counted. People I know already use voice recognition technology to write essays and documents. I love the voice commands in my 2006 car. If we can do 3D, no doubt, this will happen. I am surprised that as many as 21% of experts disagree.
7. Next-generation research will be used to improve they current internet; it won't replace it. I think it depends how you define the internet. Is the Cloud still the internet? Wow, slam-dunk: 78% of expert agree! It seems they see the internet like a car, starting as a model T and always getting better, without changing its basic components... Unless you think more along the lines of David Hakken, a professor of anthropology at the Indiana University School of Informatics who studies social change and the use of automated information and communication technologies who predicts “By 2020, two major advances will have significant impact. The first is bioengineering and nanotechnology, allowing the Net to be ‘embedded’ into individual humans (scary, eh?); the second is quantum computing that will significantly alter the current electrically loaded computing engines.”
8. Few lines divide professional time from personal time, and that's OK. If we are all to become free-agents, then I guess this is true. I do not see us all becoming free-agents by 2020. Another reason I do not see this happening by 2020 is the fact that today devices are still really strong in one area: the iphone is great for surfing the internet, the blackberry is still the "professional" platform for e-mail. However, 56% of experts agree, seeing a "net-positive" impact. I'm not yet convinced...
I will go over the 8 scenarios proposed, and in one or two sentences describe why I do or do not agree with it, and compare that to the prevailing thought. I'll formulate my opinion before looking to see how the experts felt.
1. The mobile phone is the primary connection tool for most people in the world. Whether it is a phone, or another mobile device, this seems inevitable. The increase in computation power of these devices alone makes it likely that they'll be able to meet the needs of most. 77% of the experts also agreed
2. Social tolerance has advanced significantly due in great part to the internet. I'm having a hard time seeing a strong relation there. To the contrary, the internet could be a way to anonymously associate with people of like persuasion, and exacerbate intolerance. Only 32% agreed, while 56% disagreed.
3. Content control through copyright-protection technology dominates. I do not see that happening either. I believe as user-generated content continue to grow, the power of collective knowledge will dominate, and that we will see less and less copyright-protection sought. Once again, 60% of experts also disagreed.
4. Transparency heightens individual integrity and forgiveness. No doubt on the first one, as I believe it is already happening. I find it incredibly arrogant for celebrities or politicians to misbehave and think they can get away with it in this day and age. I would love for forgiveness to be on the rise also... Experts are split, 45% agreeing, 44% disagreeing, mostly citing wrongful accusations, and the need to rebuild one's wrongly tarnished reputation... not convinced.Wiener is one example of the former. When it comes to the latter, maybe, The jury is still out on IMF's DSK.
5. Many lives are touched by the use of augmented reality or spent interacting in artificial spaces. I guess this is where the movie "Surrogate" comes in. Great movie. That extreme will not be here by 2020, but I can see this as being appealing to many. So I think the idea valid. 55% of experts agree.
6. Talk and Touch are common technology interfaces. I think of all the scenarios so far, this is the easiest to see coming to reality very soon. Touch for sure will be the primary means to control interfaces. The days of the mouse are counted. People I know already use voice recognition technology to write essays and documents. I love the voice commands in my 2006 car. If we can do 3D, no doubt, this will happen. I am surprised that as many as 21% of experts disagree.
7. Next-generation research will be used to improve they current internet; it won't replace it. I think it depends how you define the internet. Is the Cloud still the internet? Wow, slam-dunk: 78% of expert agree! It seems they see the internet like a car, starting as a model T and always getting better, without changing its basic components... Unless you think more along the lines of David Hakken, a professor of anthropology at the Indiana University School of Informatics who studies social change and the use of automated information and communication technologies who predicts “By 2020, two major advances will have significant impact. The first is bioengineering and nanotechnology, allowing the Net to be ‘embedded’ into individual humans (scary, eh?); the second is quantum computing that will significantly alter the current electrically loaded computing engines.”
8. Few lines divide professional time from personal time, and that's OK. If we are all to become free-agents, then I guess this is true. I do not see us all becoming free-agents by 2020. Another reason I do not see this happening by 2020 is the fact that today devices are still really strong in one area: the iphone is great for surfing the internet, the blackberry is still the "professional" platform for e-mail. However, 56% of experts agree, seeing a "net-positive" impact. I'm not yet convinced...
X501 - Week V - Part I - Using Six Sigma to Model Human Behavior
The main idea behind web analytics is solving Y = f(x), where Y is our behavior, and x are all the inputs that lead us to behave the way the do.
In that regard, numerati and web analysts use many of the same tools six sigma practitioners, in particular black belts use as they go through the 5 step DMAIC process. That is a key reason I agree with the 10/90 rule. Analytics software is a lot like a vending machine. You plug in numbers, and it will spit out statistics. However, if you do not ask the right question, you will not collect the right data, and will not be able to use any output generated by the software. It is not about data, it is about the right data, collected the right way, to answer the right questions. You need people (six sigma black belts or analysts) to figure out the right questions, and build the data collection plans. As Avinash Kaushik writes in Web Analytics: An Hour a Day: "How data is captured is perhaps the most critical part of an analyst's ability to process the data and find insights."
I will now show how web analytics parallel the six sigma DMAIC process
1. Define - What is the practical business question we are asking, what is the problem we want to solve?
That's the starting point of any scientific inquiry. Since the purpose of analytics is solving Y=f(x), we need to define Y! The question can be very specific, like "why do romantic-movie lovers click on rental car ads," or more universal, as in "what drives consumer purchasing decisions?"
2. Measure - You start collecting data on your website. Kaushik writes: "Measuring how your website is delivering for your customers will help you focus your web analytics program and cause you to radically rethink the metrics that you need to measure to rate the performance of a website." You also start mapping the process by which you currently use analytics.
3. Analyze - In a typical six sigma sense, this is where you look for the root causes of your output performance. At this point, you are turning your practical business problem into a statistical problem. You begin by using divergent thinking to identify all the potential inputs into your process. There are millions of bits of information to sift through. Tacoda "harvests 20 billion of these behavioral clues every day." You begin to collect all the x's that may make up your model. Next, you go into convergent thinking, where you narrow down all your inputs to the critical few, foregoing the trivial many. The skill comes in finding correlation between the inputs and the outputs, and starting to build theoretical models of behavior, based on these inputs, or, as Stephen Baker writes in The Numerati, "the key to this process is to find similarities and patterns." One of the most intriguing points in the introduction to Numerati is how correlations can be built through indirect relationships and assumptions. Using the movies (Netflix, Hulu, Youtube?) or the music we listen to (say Pandora, Spotify), one could make an assumption about our mood, and use our mood to figure out what products we may be interested in... There are so many opportunities for discovery. A pioneering book on behavioral economics is Dan Ariely's "Predictably Irrational." Ariely writes on his blog:
"Good news. There is a science called Behavioral Economics. This attempts to understand people’s day to day decisions (where do I get my morning coffee?) and people’s big decisions (How much should I save for retirement?). Understanding HOW your users make decisions and WHY they make them is powerful. With this knowledge, companies can build more effective products, governments can create impactful policies and new ideas can gain faster traction."
4. Improve - At this point, you have an hypothesized model, and you must evaluate its accuracy, or more correctly, its usefulness. As statistician George Box said, "all models are wrong, some are useful." The criteria for a good model are, as described by Baker, that "they [the variables] must interact with one another mathematically just the way they do in the real world." Experimentation is the role of this stage in the development of models.
5. Control - Once you have a statistical model that works, you need to convert that statistical knowledge, or solution, to a practical solution, and use it in your marketing strategy. As you continue to refine this solution set, it is likely that the statistical equation you derive gets simplified. "All things being equal, the simplest solutions tends to be the best one." Will one model be enough? Of course not, as each model is only valid within the dataset it was developed with, i.e. its inference space. Baker alludes to this when he writes: "In the coming decade... we'll be modeled as workers, patients, soldiers, lovers, shoppers, and voters."
Baker goes even further, hinting at the idea of the "long tail," when he writes: "The trick is now to deliver to each of us the precise flavor and texture and color we want, at just the right price." Analytics are key, and Six Sigma can help!
In that regard, numerati and web analysts use many of the same tools six sigma practitioners, in particular black belts use as they go through the 5 step DMAIC process. That is a key reason I agree with the 10/90 rule. Analytics software is a lot like a vending machine. You plug in numbers, and it will spit out statistics. However, if you do not ask the right question, you will not collect the right data, and will not be able to use any output generated by the software. It is not about data, it is about the right data, collected the right way, to answer the right questions. You need people (six sigma black belts or analysts) to figure out the right questions, and build the data collection plans. As Avinash Kaushik writes in Web Analytics: An Hour a Day: "How data is captured is perhaps the most critical part of an analyst's ability to process the data and find insights."
I will now show how web analytics parallel the six sigma DMAIC process
1. Define - What is the practical business question we are asking, what is the problem we want to solve?
That's the starting point of any scientific inquiry. Since the purpose of analytics is solving Y=f(x), we need to define Y! The question can be very specific, like "why do romantic-movie lovers click on rental car ads," or more universal, as in "what drives consumer purchasing decisions?"
2. Measure - You start collecting data on your website. Kaushik writes: "Measuring how your website is delivering for your customers will help you focus your web analytics program and cause you to radically rethink the metrics that you need to measure to rate the performance of a website." You also start mapping the process by which you currently use analytics.
3. Analyze - In a typical six sigma sense, this is where you look for the root causes of your output performance. At this point, you are turning your practical business problem into a statistical problem. You begin by using divergent thinking to identify all the potential inputs into your process. There are millions of bits of information to sift through. Tacoda "harvests 20 billion of these behavioral clues every day." You begin to collect all the x's that may make up your model. Next, you go into convergent thinking, where you narrow down all your inputs to the critical few, foregoing the trivial many. The skill comes in finding correlation between the inputs and the outputs, and starting to build theoretical models of behavior, based on these inputs, or, as Stephen Baker writes in The Numerati, "the key to this process is to find similarities and patterns." One of the most intriguing points in the introduction to Numerati is how correlations can be built through indirect relationships and assumptions. Using the movies (Netflix, Hulu, Youtube?) or the music we listen to (say Pandora, Spotify), one could make an assumption about our mood, and use our mood to figure out what products we may be interested in... There are so many opportunities for discovery. A pioneering book on behavioral economics is Dan Ariely's "Predictably Irrational." Ariely writes on his blog:
"Good news. There is a science called Behavioral Economics. This attempts to understand people’s day to day decisions (where do I get my morning coffee?) and people’s big decisions (How much should I save for retirement?). Understanding HOW your users make decisions and WHY they make them is powerful. With this knowledge, companies can build more effective products, governments can create impactful policies and new ideas can gain faster traction."
4. Improve - At this point, you have an hypothesized model, and you must evaluate its accuracy, or more correctly, its usefulness. As statistician George Box said, "all models are wrong, some are useful." The criteria for a good model are, as described by Baker, that "they [the variables] must interact with one another mathematically just the way they do in the real world." Experimentation is the role of this stage in the development of models.
5. Control - Once you have a statistical model that works, you need to convert that statistical knowledge, or solution, to a practical solution, and use it in your marketing strategy. As you continue to refine this solution set, it is likely that the statistical equation you derive gets simplified. "All things being equal, the simplest solutions tends to be the best one." Will one model be enough? Of course not, as each model is only valid within the dataset it was developed with, i.e. its inference space. Baker alludes to this when he writes: "In the coming decade... we'll be modeled as workers, patients, soldiers, lovers, shoppers, and voters."
Baker goes even further, hinting at the idea of the "long tail," when he writes: "The trick is now to deliver to each of us the precise flavor and texture and color we want, at just the right price." Analytics are key, and Six Sigma can help!
Tuesday, July 12, 2011
Week 5 - Plan of Attack
Alright, Klout Score up to 32 - Makes me a Socializer. Sweet!
So this week's topic is Web Metrics and Marketing Research...
Yesterday, I watched a couple of videos on the history of the Internet. After watching the 8 minute Brief History of the Internet on Youtube, it was much easier to follow Frank Acito on his more detailed review... Vaguely reminds me of a movie, can't remember... oh yes Terminator... More on this later this week.
Got some reading left to do, namely the intro to "The Numerati" (Da Vinci Code anyone?), and the chapter about the "Critical Components of a Successful Web Analytics Strategy" since I dabble in business analytics professionally...
Finally, since I started the week looking at the past of the internet, it seems fitting that I end the week looking at what experts expect the future of the internet to be...
I'll Be Back!
So this week's topic is Web Metrics and Marketing Research...
Yesterday, I watched a couple of videos on the history of the Internet. After watching the 8 minute Brief History of the Internet on Youtube, it was much easier to follow Frank Acito on his more detailed review... Vaguely reminds me of a movie, can't remember... oh yes Terminator... More on this later this week.
Got some reading left to do, namely the intro to "The Numerati" (Da Vinci Code anyone?), and the chapter about the "Critical Components of a Successful Web Analytics Strategy" since I dabble in business analytics professionally...
Finally, since I started the week looking at the past of the internet, it seems fitting that I end the week looking at what experts expect the future of the internet to be...
I'll Be Back!
Saturday, July 2, 2011
Expanded Week IV - Show Me the Money!
Yes, "Show me the Money!" summarizes this week's reading very well...
How do you make money on the Web? I love how Jun Loayza begins in 5 Business Models for Social Media Start-up: "During the first internet boom, the most common business model was probably, 'get a ton of traffic, then figure out how to make money.'" It appears not that much has changed with Web2.0, though Social Media behemoths are launching IPOs left and right, and raising huge capital... I will use professor Rappa's framework as a starting point, expand on it by adding new examples, and finally wrap up with monetizing Tweeter.
1. Brokerage model - Websites that serve as middlemen, connecting sellers and customers. I look at these websites as Divergent/Convergent search engines. They first give you a large range of choices, and then you may cascade through other websites to narrow down the search. My experience with these broad search vehicles is that they come back with dozens of links. When you click on any of these links, you end up on seemingly independent merchants. However, under closer scrutiny, it often looks like you are dealing with the same vendor, using separate storefronts. The prices are the same, the descriptions are the same verbatim, even the pictures are exactly the same. I'm not a big fan of the brokerage model, as this is another example where more is not more. Charlie Kim, founder of NextJump, B2B Analytics company agrees: Offering 6 million products for customers to choose from is not smart. The same idea is developed by Richard Thaler in his best-selling book "Nudge." Websites that follow this model are Amazon.com, YahooShopping.com, PriceGrabber.com, Nextag.com. I think this is where branding, and brand loyalty come in. I develop brand loyalty, and go directly to the brand's website, bypassing "brokers." Not a big fan of this model... Interesting how American chose to remove its fare from Expedia, but was forced back in... AA still highly promotes its own website for booking, offering a very extensive "lowest price guarantee."
2. Advertising Model - To some extent, all websites dabble in advertising. It may be more or less targeted, but they all do it. This seems to be the obvious financing mechanism for many websites. Yahoo, Google and Facebook all collect customer data that they then use to assign their members to customer segment and target advertising. You come to expect banners on all free websites. Sometimes they're pretty subtle, sometimes, they are part of the interface. On Grooveshark, the advertiser fills out practically the entire screen, quite a turn-off.
3. Infomediary Model - Reid Hoffman, venture capitalist and founder of LinkedIn writes: "People think, "Oh no! This company has data about me!" To that I say: OK, so a website or mobile application knows that you're a man or a woman, and it's giving you ads based on that. That's a benefit, not a bug." I tend to agree. If you volunteer information, why wouldn't companies use that data to serve you better? Going back to Nudge, Thaler advocates freedom of choice, but making it easy for people (in this case customers) to choose the best solution to their need. Customer data can do that! Furthermore, Charlie Kim's best point was that companies should not use data "to guess." If they guess wrong, you end up with spam, which no one likes... But if you collect too much data, customers might feel violated by the perceived privacy breech and lose trust. Businesses will find themselves somewhere along this continuum... NextJump is a great example of helping businesses take the guess work out of targeted advertising. As long as these companies are transparent about what data is collected, and how it is used, I have no issues with this; I believe it can help them serve us better, but maybe I am too naive...
4. Merchant Model - Wholesaler. Most of the websites I visit in this category are "Click and Mortar" (I love that play on brick and mortar!) These models are able to build on the brand loyalty developed over years of patronizing the physical store. They are especially handy if you have to relocate and your favorite clothing store does not have a retail store where you live now. These companies probably have higher overheads, but are able to build brand loyalty, thereby increasing the percentage of repeat customers to their stores/website. Merchant models take the traditional shopping model, and move it to a new media. At this point, the only "Bit vendor" (another great terminology) I use is iTunes. I have not bought an actual CD in years, and don't think I ever will again. It's been interesting to see the music section in stores like Walmart or Target simply shrink and atrophy over the last few years. It used to be a must stop area in the store growing up... Jen Beckman's pitch for 20/200 was passionate. She has a very clear mission: "turning customers into connoisseurs of art." She is sharing the art she is so passionate about and making it accessible to the masses. Rebecca Thorman made a great pitch for Alice.com. I've registered and plan to try it out. It looks like the site offers adequate choice of my favorite brands and products. I am likely to convert if Alice.com is able to come through on its promise of better pricing than brick and mortar grocers.
5. Manufacturer (Direct) Model - Rappa gives the example of Dell. Other examples are Apple, Adidas, Banana Republic, Fossil (wink!) I find it interesting that some companies (TagHeuer for instance) refer you to licensed and authorized retailers, but do not sell their products on their website. I'm not sure there would be a downside to doing so...
6. Affiliate Model - B2B business model, likely used in conjunction with another business model...
7. Community/Subscription/Utility Models - Parra writes that these models are based on "user loyalty." This is where the Jun Loayza comes in. Typical revenue is generated through premium service subscription (Freemium model, like LinkedIn, Pandora...); sales of ancillary products and services (Affiliate Model); Content services (Subscription Model like Netflix), voluntary contributions (Virtual Goods Model), and contextual advertising (Advertising Model). I wonder if the utility model will become more prevalent, with limits on bandwidth, or if the infrastructure is able to keep up with increased usage, if this model will go the way of the dodo...
So, with all these business models out there, how does Twitter plan to make money? Currently, 97% of spending at Tweeter is going to the product and the technology. Evan Williams' purpose, he says, is to provide the best, freshest information available. Tweeter is not a social network, he continues, it is an information network. Who owns news? Is tweeter the new CNN? A timely Opinion piece by Gordon Crovitz in the Wall Street Journal address the legal side of who owns the news. I will not quote the entire "Technology Trumps Law" article, which can be found here and is worth the read:
http://online.wsj.com/article/SB10001424052702304569504576405672792064908.html , but here is a key extract: "But just because the law can't control how news spreads does not make technology a pure good. Google and Twitter filed a brief in Theflyonthewall, warning: "Hot news becomes cold in a nanosecond in the modern world." They don't want restriction on their business practices." When John Battelle insists, and rephrases his question, Evan still does not really answer. From his body language, I could not tell if he really did not know, or was unto something so revolutionary that he did not want to give it away... My money is on the latter...
How do you make money on the Web? I love how Jun Loayza begins in 5 Business Models for Social Media Start-up: "During the first internet boom, the most common business model was probably, 'get a ton of traffic, then figure out how to make money.'" It appears not that much has changed with Web2.0, though Social Media behemoths are launching IPOs left and right, and raising huge capital... I will use professor Rappa's framework as a starting point, expand on it by adding new examples, and finally wrap up with monetizing Tweeter.
1. Brokerage model - Websites that serve as middlemen, connecting sellers and customers. I look at these websites as Divergent/Convergent search engines. They first give you a large range of choices, and then you may cascade through other websites to narrow down the search. My experience with these broad search vehicles is that they come back with dozens of links. When you click on any of these links, you end up on seemingly independent merchants. However, under closer scrutiny, it often looks like you are dealing with the same vendor, using separate storefronts. The prices are the same, the descriptions are the same verbatim, even the pictures are exactly the same. I'm not a big fan of the brokerage model, as this is another example where more is not more. Charlie Kim, founder of NextJump, B2B Analytics company agrees: Offering 6 million products for customers to choose from is not smart. The same idea is developed by Richard Thaler in his best-selling book "Nudge." Websites that follow this model are Amazon.com, YahooShopping.com, PriceGrabber.com, Nextag.com. I think this is where branding, and brand loyalty come in. I develop brand loyalty, and go directly to the brand's website, bypassing "brokers." Not a big fan of this model... Interesting how American chose to remove its fare from Expedia, but was forced back in... AA still highly promotes its own website for booking, offering a very extensive "lowest price guarantee."
2. Advertising Model - To some extent, all websites dabble in advertising. It may be more or less targeted, but they all do it. This seems to be the obvious financing mechanism for many websites. Yahoo, Google and Facebook all collect customer data that they then use to assign their members to customer segment and target advertising. You come to expect banners on all free websites. Sometimes they're pretty subtle, sometimes, they are part of the interface. On Grooveshark, the advertiser fills out practically the entire screen, quite a turn-off.
3. Infomediary Model - Reid Hoffman, venture capitalist and founder of LinkedIn writes: "People think, "Oh no! This company has data about me!" To that I say: OK, so a website or mobile application knows that you're a man or a woman, and it's giving you ads based on that. That's a benefit, not a bug." I tend to agree. If you volunteer information, why wouldn't companies use that data to serve you better? Going back to Nudge, Thaler advocates freedom of choice, but making it easy for people (in this case customers) to choose the best solution to their need. Customer data can do that! Furthermore, Charlie Kim's best point was that companies should not use data "to guess." If they guess wrong, you end up with spam, which no one likes... But if you collect too much data, customers might feel violated by the perceived privacy breech and lose trust. Businesses will find themselves somewhere along this continuum... NextJump is a great example of helping businesses take the guess work out of targeted advertising. As long as these companies are transparent about what data is collected, and how it is used, I have no issues with this; I believe it can help them serve us better, but maybe I am too naive...
4. Merchant Model - Wholesaler. Most of the websites I visit in this category are "Click and Mortar" (I love that play on brick and mortar!) These models are able to build on the brand loyalty developed over years of patronizing the physical store. They are especially handy if you have to relocate and your favorite clothing store does not have a retail store where you live now. These companies probably have higher overheads, but are able to build brand loyalty, thereby increasing the percentage of repeat customers to their stores/website. Merchant models take the traditional shopping model, and move it to a new media. At this point, the only "Bit vendor" (another great terminology) I use is iTunes. I have not bought an actual CD in years, and don't think I ever will again. It's been interesting to see the music section in stores like Walmart or Target simply shrink and atrophy over the last few years. It used to be a must stop area in the store growing up... Jen Beckman's pitch for 20/200 was passionate. She has a very clear mission: "turning customers into connoisseurs of art." She is sharing the art she is so passionate about and making it accessible to the masses. Rebecca Thorman made a great pitch for Alice.com. I've registered and plan to try it out. It looks like the site offers adequate choice of my favorite brands and products. I am likely to convert if Alice.com is able to come through on its promise of better pricing than brick and mortar grocers.
5. Manufacturer (Direct) Model - Rappa gives the example of Dell. Other examples are Apple, Adidas, Banana Republic, Fossil (wink!) I find it interesting that some companies (TagHeuer for instance) refer you to licensed and authorized retailers, but do not sell their products on their website. I'm not sure there would be a downside to doing so...
6. Affiliate Model - B2B business model, likely used in conjunction with another business model...
7. Community/Subscription/Utility Models - Parra writes that these models are based on "user loyalty." This is where the Jun Loayza comes in. Typical revenue is generated through premium service subscription (Freemium model, like LinkedIn, Pandora...); sales of ancillary products and services (Affiliate Model); Content services (Subscription Model like Netflix), voluntary contributions (Virtual Goods Model), and contextual advertising (Advertising Model). I wonder if the utility model will become more prevalent, with limits on bandwidth, or if the infrastructure is able to keep up with increased usage, if this model will go the way of the dodo...
So, with all these business models out there, how does Twitter plan to make money? Currently, 97% of spending at Tweeter is going to the product and the technology. Evan Williams' purpose, he says, is to provide the best, freshest information available. Tweeter is not a social network, he continues, it is an information network. Who owns news? Is tweeter the new CNN? A timely Opinion piece by Gordon Crovitz in the Wall Street Journal address the legal side of who owns the news. I will not quote the entire "Technology Trumps Law" article, which can be found here and is worth the read:
http://online.wsj.com/article/SB10001424052702304569504576405672792064908.html , but here is a key extract: "But just because the law can't control how news spreads does not make technology a pure good. Google and Twitter filed a brief in Theflyonthewall, warning: "Hot news becomes cold in a nanosecond in the modern world." They don't want restriction on their business practices." When John Battelle insists, and rephrases his question, Evan still does not really answer. From his body language, I could not tell if he really did not know, or was unto something so revolutionary that he did not want to give it away... My money is on the latter...
Monday, June 27, 2011
@AmericanAir
From June 19th through the 24th, I followed @AmericanAir, the official tweeter site for American Airlines Customer Relations, http://www.aa.com/customerrelations. I started flying American Airlines when I moved to Dallas, since AA has a hub at DFW. I’m used to American now, earning miles, and having been able to redeem them twice to date with no or minimal scheduling restriction. I’ve been travelling a lot this year, and for the first time, will attain gold status after only 2 more segments. I thought it would be interesting to follow American this week because I suspected they deal with a lot of upset travelers. I was curious to see how they handled different situations, what the most common issues they dealt with were, and I hoped to learn something useful for when I might encounter the very same issues…
In the section where tweeter allows you to draft a small description, @AmericanAir writes: “Thanks for checking in! Send your praise, concerns and suggestions to the link below to ensure an appropriate response from American Airlines.” How interesting! American Airlines invites you to go to their website to submit your comments? This seems a little bit odd, considering what Paul Gillin wrote in The New Influencers: “Another truth with the blogosphere [of which twitter is part] is that transparency is key to working in this medium.” It would be very interesting to find out how many travelers, when choosing between tweeting, direct-messaging (DM) and going to the website actually DM or chose the website. If I were to venture a guess, I’d say probably not that many, since tweeter is a new form of communication, and passengers want to publicly express their thoughts, opinions and emotions… I wonder if American would be better served writing something else in their introduction…
This past week, @AmericanAir tweeted 93 times. Of these 93 times, 87, or 94% were in response to tweets mentioning @AmericanAir. This tells me that American scans the Tweeterverse to see what is being shared about its brand. Actually, AA scans the entire social web, as it posts to tweeter using Tweetdeck, a website that, as we learned in our previous class, allows to efficiently search the social web for mentions of your brand. American, in that regard is very pro-active, and takes social networking very seriously. It wants to avoid “blog swarms,” like the one that targeted United a couple of years ago, when a Youtube video stirred quite a buzz: “United breaks guitars…” (http://youtu.be/5YGc4zOqozo). Contrast that to today’s timely post by pop-group Hanson “Thanks to @AmericanAir for helping repair/replace the broken guitar. – ISAAC” What are the odds, right? Responding to tweets mentioning @AmericanAir, as identified by scanning of the online social universe, seems to be the primary purpose of the @American Air tweet page. Only 6 tweets were not in response to passenger comments.
The six “unsolicited” tweets break down as follows: two tweets about fare sales (4th of July travel, international travel); two “fun/exciting” tweets about AA travelers habits or happenings: One is getting married this week-end after meeting her fiancé on an AA flight, the other browses AA.com when she gets bored, looking for future trips; one tweet simply read “ALERT: Reservations is all-hands managing high call traffic due to #weather last night” indicating that AA is aware and is working diligently to resolve the issues; the last tweet was in regards to AA’s work on its environmental footprint, as @AmericanAir tweets: “We’re testing the #ecoDemonstrator Program w/ Boeing to make flying cleaner for the #environment! More: http://bit.ly/AAECODEMO.”
Of the other 87 tweets, 15 included requests for the individual originating the tweet to direct message American Airlines back with specific information, or to follow @American Air in order for AA to DM specific information to the traveler. I did not know Tweeter offered the option to direct message. Apparently, one can DM @AmericanAir, whether or not she is following, but one needs to follow @American Air in order for American to be able to DM back. Furthermore, the typical exchange between a traveler and @AmericanAir lasts 2 or 3 tweeted responses. In that regards, @AmericanAir seems to use tweeter as a chat substitute.
And now, I am sure you’d like to know what the key topics American customers tweet about that led to AA tweet responses… Two travelers tweeted about they planned to use their AA miles. Ten travelers tweeted to thank AA employees for helping resolve an issue (wow! That’s 11%) and six more gave a shout out for AA’s Admiral’s club, in-flight internet and plug-ins and cheap ticket prices, some explicitly mentioning AA’s deal finder app (only available for PC right now, as one tweeter noted). One traveler complimented American on a cool paint job for one of its jets (http://lockerz.com/s/113387928), three passengers tweeted for help with a flight cancellation, and one for help with a seat assignment. LondonGirlinLA tweeted about not booking an AA flight because of a $600 price difference with USAir; thirteen passengers tweeted to complain about being bumped, delayed, or hit with flight cancellations, which is not all that bad. @AmericanAir always responded professionally, apologetically and attempted to get additional detail and information in order to better help. Only three tweets mentioned lost baggage. A couple complaints dealt with maintenance issues that @AmericanAir said would be addressed promptly: one aircraft’s cabin was filthy, and in the other, some of the TV monitors were not functioning properly. One tweet mentioned American’s lost opportunity to earn goodwill when not upgrading to first class some of the 25 passengers on a near-empty recent flight.
In conclusion, American Airlines is definitely engaged with the social web, tracking and monitoring what is being shared about its brand. It does not appear to use tweeter as an aggressive advertising tool, though it does play a role in its marketing strategy. American Airlines has taken to heart some of the advice published by Razorfish, namely the role played by key, social and known peer influencers in the marketing funnel. This is good for American Airlines, though I felt that the way it used tweeter was more for public relations, feeding information via this new portal to a traditional customer service department.
Week IV - Business Models & the New Era of Competition
Home this week! Grooveshark playing in the background; not sold on it yet...
Looking forward to the breeze sessions this week... Other than the required reading, the videos on monetizing tweeter and eCommerce look interesting, so I'll watch those. I also printed out the "5 business models for social media start-up." I like being able to categorize and affinitize ideas, so I think this will be a good read...
I think this week will allow me to think more holistically about the social web as business models...
I am also looking forward to start building my klout...
Looking forward to the breeze sessions this week... Other than the required reading, the videos on monetizing tweeter and eCommerce look interesting, so I'll watch those. I also printed out the "5 business models for social media start-up." I like being able to categorize and affinitize ideas, so I think this will be a good read...
I think this week will allow me to think more holistically about the social web as business models...
I am also looking forward to start building my klout...
Friday, June 24, 2011
Long Tails, Ant Circles, Razorfish & Other Takeaways
The material this week really showed the impact that consumers actually have on the firms where they decide to shop, or not to shop...
The Long Tail
The week-end started with the Chris Anderson interview and the 98% rule: Merchants will sell at least one item of 98% of the products they offer. This led him to develop the theory of the long tail. Essentially, he starts by drawing a Pareto chart of the sales, and notices that the chart is flattening out, and that the tail is getting longer and longer. He then concludes that focusing on the top 20% of products no longer generate enough revenue for a business to thrive, and that merchants should not narrow their focus to these. Adidas has adopted a strategy of extreme customization with its miAdidas brand. Buyers can go in, and completely customize the colors of all the elements that make up the miShoe. Adidas might very well sell 98% of all the possible combinations. Talk about a win-win: I get to design my own shoe, and Adidas gets access to our tastes.
Chris goes on to make several interesting points about "Hit" products:
1. Hits are typically loss leaders
2. Social communication works along the long tail, essentially concentrating things towards the hits. Essentially, if enough people like a product, the product will hit a "tipping point" and become a hit
3. Heavy users end up in the tail, while mainstream is in the hits.
Ant Circles
Of course, I am referring to the James Surowiecki video.
The concept of "Wisdom of crowds" particularly resonated with me. He describe blogs as giving us access to a collective intelligence previously untapped. He goes on to say that "Readers know more than the media." I do believe that a team will reach a better decision/outcome than the average outcome arrived at independently, but it is also true that some members of the group will reach better decisions than the team. Apparently that shows up over and over in research... He does have a great caveat: "Groups are only smart when the members think independently," essentially avoiding "group think"
Tweeting/Blogging does not make me weird... That's a relief!
The Evan Williams interview by Charlie Rose was both entertaining and insightful. Charlie did figure it out, since I was able to find him on Tweeter and am now following him. So Evan was simply looking to create a new way to communicate. I think he succeeded. I love it when he says that blogs, facebook and tweeter are things "normal" people do. He describes it as an "open way to live your life." When he talks about countries where tweeter is big, the list was a little surprising.US, Japan, UK, sure, but Germany and Brazil?
Whether or not he is able to monetize tweeter is the big question. Evan says he has some ideas; I bet he does... He places himself on a continuum between social communication ($0) and information ($$$). The closer he can place tweeter into being a purveyor of information, connecting people to information they value, the greater the potential for profit.
Blog Swarms
Any body can write a blog about anything. I would suspect this follows the 98% rule: 98% of all blogs are read by at least 1 person other than its originator... and if enough people do and create a buzz, the readership will reach a tipping point, and you'll have a hit blog. "The origins of social media" gives us a introduction into the blog landscape, what it, what it does, how it does it. "It's informal but inform" has to be one of my favorite sentences form the chapter. The author makes a great point on the inter-dependency of bloggers and media. One does not trump the other, they compliment each other. Blogs rely on media coverage in order to create commentary, and at times, blogs might break the news because of their proximity to events. Information, information, information...
What does it mean for businesses: "This premium on transparency may be the single greatest cultural shift that businesses will face as they engage with social media." Note that the author does not say "if they engage" but that this engagement is a foregone conclusion.
Razorfish
That name just sounded cool, so I wanted to see what this was about... What a vast amount of information... So I've selected highlights that I thought were particularly interesting...
"Ownership of the brand no longer resides in the hands of the brand itself, as consumers and potential consumers are beginning to shape brands as much as brands shape them."
1. Brands must socialize with consumers
2. Brands must develop a credible social voice
3. Brands must provide a return on emotion (ROE) to their customers
Because word of mouth (on or offline) is a key influence on customers:
1. Brands must know who influences perception
2. Brands must know the effect of influencers throughout their marketing funnel (or the product stages as we saw in last quarter's class)
3. Know peer influencers matter most at the bottom of the funnel
Social ads need to be relevant, actionable, interactive and personal. I love Diana Stepner's "10 first steps" for companies to take control of their tweeterverse...
Customers look for brands that help them connect, Brands aren't connecting enough with consumers in a social environment, "fans" of brands visit, and re-visit those sites...
The Long Tail
The week-end started with the Chris Anderson interview and the 98% rule: Merchants will sell at least one item of 98% of the products they offer. This led him to develop the theory of the long tail. Essentially, he starts by drawing a Pareto chart of the sales, and notices that the chart is flattening out, and that the tail is getting longer and longer. He then concludes that focusing on the top 20% of products no longer generate enough revenue for a business to thrive, and that merchants should not narrow their focus to these. Adidas has adopted a strategy of extreme customization with its miAdidas brand. Buyers can go in, and completely customize the colors of all the elements that make up the miShoe. Adidas might very well sell 98% of all the possible combinations. Talk about a win-win: I get to design my own shoe, and Adidas gets access to our tastes.
Chris goes on to make several interesting points about "Hit" products:
1. Hits are typically loss leaders
2. Social communication works along the long tail, essentially concentrating things towards the hits. Essentially, if enough people like a product, the product will hit a "tipping point" and become a hit
3. Heavy users end up in the tail, while mainstream is in the hits.
Ant Circles
Of course, I am referring to the James Surowiecki video.
The concept of "Wisdom of crowds" particularly resonated with me. He describe blogs as giving us access to a collective intelligence previously untapped. He goes on to say that "Readers know more than the media." I do believe that a team will reach a better decision/outcome than the average outcome arrived at independently, but it is also true that some members of the group will reach better decisions than the team. Apparently that shows up over and over in research... He does have a great caveat: "Groups are only smart when the members think independently," essentially avoiding "group think"
Tweeting/Blogging does not make me weird... That's a relief!
The Evan Williams interview by Charlie Rose was both entertaining and insightful. Charlie did figure it out, since I was able to find him on Tweeter and am now following him. So Evan was simply looking to create a new way to communicate. I think he succeeded. I love it when he says that blogs, facebook and tweeter are things "normal" people do. He describes it as an "open way to live your life." When he talks about countries where tweeter is big, the list was a little surprising.US, Japan, UK, sure, but Germany and Brazil?
Whether or not he is able to monetize tweeter is the big question. Evan says he has some ideas; I bet he does... He places himself on a continuum between social communication ($0) and information ($$$). The closer he can place tweeter into being a purveyor of information, connecting people to information they value, the greater the potential for profit.
Blog Swarms
Any body can write a blog about anything. I would suspect this follows the 98% rule: 98% of all blogs are read by at least 1 person other than its originator... and if enough people do and create a buzz, the readership will reach a tipping point, and you'll have a hit blog. "The origins of social media" gives us a introduction into the blog landscape, what it, what it does, how it does it. "It's informal but inform" has to be one of my favorite sentences form the chapter. The author makes a great point on the inter-dependency of bloggers and media. One does not trump the other, they compliment each other. Blogs rely on media coverage in order to create commentary, and at times, blogs might break the news because of their proximity to events. Information, information, information...
What does it mean for businesses: "This premium on transparency may be the single greatest cultural shift that businesses will face as they engage with social media." Note that the author does not say "if they engage" but that this engagement is a foregone conclusion.
Razorfish
That name just sounded cool, so I wanted to see what this was about... What a vast amount of information... So I've selected highlights that I thought were particularly interesting...
"Ownership of the brand no longer resides in the hands of the brand itself, as consumers and potential consumers are beginning to shape brands as much as brands shape them."
1. Brands must socialize with consumers
2. Brands must develop a credible social voice
3. Brands must provide a return on emotion (ROE) to their customers
Because word of mouth (on or offline) is a key influence on customers:
1. Brands must know who influences perception
2. Brands must know the effect of influencers throughout their marketing funnel (or the product stages as we saw in last quarter's class)
3. Know peer influencers matter most at the bottom of the funnel
Social ads need to be relevant, actionable, interactive and personal. I love Diana Stepner's "10 first steps" for companies to take control of their tweeterverse...
Customers look for brands that help them connect, Brands aren't connecting enough with consumers in a social environment, "fans" of brands visit, and re-visit those sites...
Tuesday, June 21, 2011
Week Overview
Traveled to Dallas this week, so got a lot of the reading/listening/viewing done late last week. I've got my rough notes down on paper, and will write these down properly this week-end as I return home.
The materials I reviewed and will discuss in my subsequent blog entry are:
- The long tail. This discussion will be fun, as in my line of work, we rely heavily on the pareto principle (80/20 rule)
- The origins of social media: "Informal but informed..."
- The James Surowiecki video: "Groups are only smarter when the members think independently."
- Evan Williams on Charlie Rose: His answer on monetizing twitter :"don't know for sure, but I have some ideas..."
- Highlights of the Razorfish report. The report presents fascinating takeways...
Will be back in a few days...
The materials I reviewed and will discuss in my subsequent blog entry are:
- The long tail. This discussion will be fun, as in my line of work, we rely heavily on the pareto principle (80/20 rule)
- The origins of social media: "Informal but informed..."
- The James Surowiecki video: "Groups are only smarter when the members think independently."
- Evan Williams on Charlie Rose: His answer on monetizing twitter :"don't know for sure, but I have some ideas..."
- Highlights of the Razorfish report. The report presents fascinating takeways...
Will be back in a few days...
Wednesday, June 15, 2011
Privacy & Ratings
Well,
the Alma Whitten kept freezing up, so I ended up watching a video on the same topic, posted on YouTube by GooglePrivacy. It's a presentation on privacy given at Harvard LAw School by Peter Fleisher in 2008.
http://www.youtube.com/watch?v=JNu1OtkWrOY
Though the video is 3 years old, a lot of the privacy issues he discusses are still relevant today, and I am not sure much has been resolved since...
One statement he makes was right on; he described ads as "the economic lifeblood of all those web 2.0 services." He then describes 3 ways of targeting ads to the web user, without ranking them in terms of privacy:
1) Contextual - Ads use the content you are looking at in real time and generates context driven advertisement
2) Demographic - self-explanatory. If the ad is able to figure out your demographic information (you are logged in, or a registered user...) and displays ads targeting that segment
3) Behavioral - If the ad is able to search your browsing history, it can use that history to generate targeted ads. I'm pretty sure yahoo.mail uses this...
The key issues Peter saw were "transparency" of the privacy policy, the ability for the customer to give or not to give "consent," "security of the information collected, and defining the additional protection for "sensitive" information... Cool video.
On the NPR star search recording, I had 3 takeaways
1) the journalists described the Star rating system as often "self-fulfilling prophecies." They did not necessarily make a great case on this point. Their examples were rather trivial, so I would not generalize this trend.
2) I do agree with them on this point: We, as consumers, need to be aware of the motives behind the ratings. They talked about "praise fraud," but there is probably also "bash fraud." It's interesting however, that unless the experience is extremely poor, or great, few of us would bother to give feedback that such and such widget was average, worthy of 3/5 stars... Unless you're talking about Netflix. My wife and I make it a point to rate the movies we watch, in order to improve Netflix's viewing recommendation... Another discussion altogether.
3) I found it interesting the 72% of users trust online reviews...There is no rational basis for that, is there?
the Alma Whitten kept freezing up, so I ended up watching a video on the same topic, posted on YouTube by GooglePrivacy. It's a presentation on privacy given at Harvard LAw School by Peter Fleisher in 2008.
http://www.youtube.com/watch?v=JNu1OtkWrOY
Though the video is 3 years old, a lot of the privacy issues he discusses are still relevant today, and I am not sure much has been resolved since...
One statement he makes was right on; he described ads as "the economic lifeblood of all those web 2.0 services." He then describes 3 ways of targeting ads to the web user, without ranking them in terms of privacy:
1) Contextual - Ads use the content you are looking at in real time and generates context driven advertisement
2) Demographic - self-explanatory. If the ad is able to figure out your demographic information (you are logged in, or a registered user...) and displays ads targeting that segment
3) Behavioral - If the ad is able to search your browsing history, it can use that history to generate targeted ads. I'm pretty sure yahoo.mail uses this...
The key issues Peter saw were "transparency" of the privacy policy, the ability for the customer to give or not to give "consent," "security of the information collected, and defining the additional protection for "sensitive" information... Cool video.
On the NPR star search recording, I had 3 takeaways
1) the journalists described the Star rating system as often "self-fulfilling prophecies." They did not necessarily make a great case on this point. Their examples were rather trivial, so I would not generalize this trend.
2) I do agree with them on this point: We, as consumers, need to be aware of the motives behind the ratings. They talked about "praise fraud," but there is probably also "bash fraud." It's interesting however, that unless the experience is extremely poor, or great, few of us would bother to give feedback that such and such widget was average, worthy of 3/5 stars... Unless you're talking about Netflix. My wife and I make it a point to rate the movies we watch, in order to improve Netflix's viewing recommendation... Another discussion altogether.
3) I found it interesting the 72% of users trust online reviews...There is no rational basis for that, is there?
Tuesday, June 14, 2011
This is the new new media
I am starting this week with the required reading and video. I also plan to read the article on web video, and to watch the Alma Whitten and Star Search videos
What I hope to gain this week is a more keen sense of awareness about:
1. How much of the web is user-generated
2. How quickly and profoundly this trend is changing the world we live in.
But first, for this post, I'll highlight my key takeaways from the Crowdsourcing extract.
I think a lot of the chapters takeaways are summarized quite well in the book by Daniel Pink, Drive, therefore I have attached a link to an illustrated synopsis of the book, narrated by the author...
http://www.youtube.com/watch?v=u6XAPnuFjJc
People are motivated by Autonomy, Mastery and Purpose, so as I go through some of the points made in the reading, I will link these to the inner motivation of this generation...
Threadless: The Jakes are tapping into the inner motivation of artists, affording them autonomy (create whatever design your want), mastery (top 10 designs get made) and purpose (express their message). Though it may not pay all the bills, people get to do something they love!
iStockPhoto: With advances in camera technology, the site plays on the inner-motivations of amateur photographers, again affording them autonomy (pick your topic), mastery (see your picture used), and purpose (express their message). Again, though it may not pay all the bills, people get to do something they love! iStock is a great example of the theory of creative destruction, but at least in this case, Getty images figured it out, and bought the new industry. Blockbuster did not realize until to late that the netflix model was taking off, and now netflix has to move to streaming videos, or it also takes the risks of being creatively destructed by the like of hulu...The pace is simply incredible...
P&G is also turning to the masses and engaging them to help solve their problems, as the article describes;
Crowdsourcing is everywhere: CNN has iReporters, YouTube its amateur videographers, etc...
I think the author is right, in that the internet gives us:
1. Opportunities to help
2. Opportunities to pursue interests
3. Opportunities to create/participate in communities
Is the internet replacing education as the great equalizer?
What I hope to gain this week is a more keen sense of awareness about:
1. How much of the web is user-generated
2. How quickly and profoundly this trend is changing the world we live in.
But first, for this post, I'll highlight my key takeaways from the Crowdsourcing extract.
I think a lot of the chapters takeaways are summarized quite well in the book by Daniel Pink, Drive, therefore I have attached a link to an illustrated synopsis of the book, narrated by the author...
http://www.youtube.com/watch?v=u6XAPnuFjJc
People are motivated by Autonomy, Mastery and Purpose, so as I go through some of the points made in the reading, I will link these to the inner motivation of this generation...
Threadless: The Jakes are tapping into the inner motivation of artists, affording them autonomy (create whatever design your want), mastery (top 10 designs get made) and purpose (express their message). Though it may not pay all the bills, people get to do something they love!
iStockPhoto: With advances in camera technology, the site plays on the inner-motivations of amateur photographers, again affording them autonomy (pick your topic), mastery (see your picture used), and purpose (express their message). Again, though it may not pay all the bills, people get to do something they love! iStock is a great example of the theory of creative destruction, but at least in this case, Getty images figured it out, and bought the new industry. Blockbuster did not realize until to late that the netflix model was taking off, and now netflix has to move to streaming videos, or it also takes the risks of being creatively destructed by the like of hulu...The pace is simply incredible...
P&G is also turning to the masses and engaging them to help solve their problems, as the article describes;
Crowdsourcing is everywhere: CNN has iReporters, YouTube its amateur videographers, etc...
I think the author is right, in that the internet gives us:
1. Opportunities to help
2. Opportunities to pursue interests
3. Opportunities to create/participate in communities
Is the internet replacing education as the great equalizer?
Saturday, June 11, 2011
Week I - Pandora, LinkedIn and Facebook
As I start synthesizing my thoughts, Pandora is streaming on my PC
Between this week being our first week, two business trips to Atlanta and Chicago, and figuring out teh workload for the 3 courses I am taking, this will be my lone week I post.
My learning goals for the week are to gain an initial insight into the topics covered in th ecourse, and into some of the services I use on a regular basis, Pandora (love it), LinkedIn, and Facebook.
I started by reading the "Made to Engage" chapter, then watched the videos on Pandora & LInkedIn, and finally read teh GQ article "Do You Trust This Face." I stopped there as the notes I had taken were gwetting close to the 750 word limit. I chose the suggested materials based on interest for teh topics as well as the format.
Between this week being our first week, two business trips to Atlanta and Chicago, and figuring out teh workload for the 3 courses I am taking, this will be my lone week I post.
My learning goals for the week are to gain an initial insight into the topics covered in th ecourse, and into some of the services I use on a regular basis, Pandora (love it), LinkedIn, and Facebook.
I started by reading the "Made to Engage" chapter, then watched the videos on Pandora & LInkedIn, and finally read teh GQ article "Do You Trust This Face." I stopped there as the notes I had taken were gwetting close to the 750 word limit. I chose the suggested materials based on interest for teh topics as well as the format.
- Business Principles
- The three founders truly believe that they have a social mission and are making the world a better place. Westergren describes Pandora as a business that has a bog impact on people through music; he wants to change the world through music. Hoffman sees LinkedIn's mission as improving people's life and helping people solve problems, "transform[ing] people's economic life." Zuckerberg is quoted as saying" "we believe that what we're doing is a good thing in the world."
- They also believe that their companies are bigger than them. Westergren, for instance, went out and hired a CEO, while Hoffman took over as CEO because his skill set was better suited to the direction LinkedIn was taking: He is an innovator leading an innovative company. Incidentally, Zuckerberg's motives are a lot harder to figure out: French writes about his "naive idealism or calculated misdirection."
- Marketing Principles
- Denise Shiffman, on page 4 of the "Age of Engage" introduces a key idea. We are moving from a corporate-created to a user-created web. Furthermore, the world of entertainment is moving from a "push" mentality to a world where individuals are "pulling" the content they are interested in.
- "Tapping into this information [available online] will forever change marketing." Pandora is a top-seller of songs on iTunes and Amazon. The 90,000 artists on Pandora enjoy unprecedented access to the public. Hoffman talks about a more intelligent use of "groups," going beyond chat rooms, where you talk with strangers, and using real relationships thereby adding much more value to the discussions. And of course, there is Facebook, which observers describe as possessing "quite possibly the most valuable database of consumer information in the history of man."
- Use of data for targeted marketing. Often times I might do a search for a specific brand of clothing, or a line of hotels, and then that brand will appear in banner ads when I check my email on Yahoo.
- The role of privacy. A key issue for Facebook. My theory is that people are fine shring their musical preferences, or professional background, but are a lot more sensitive when it comes to personal data. I like the option of opting-in v. opting out... Hoffman's tke on separate social and professional profiles is insightful. Privacy is both a key and very dynamic topic. I believe our expectations are rapidly changing.
- The role of mobile technology. Th eiPhone changed how customers saw Pandora. You can now take Pandora with you. (challenging Sirius/XM?) Mobile technology is huge for connectivity, though multiple devices might have discrete strengths, with cell-phones used for communication, BlackBerry for Outlook functions and the iPhone for teh web. One of the takeaways from last quarter's marketing assignment was how many tablets were announced in the 11 weeks that spanned our assignment. The pace of the growth of the tablet market is incredible! As Shiffman states, "we can no longer write a marketing plan at the beginning of teh year and execute against it over a year."
- Other Key Ideas
- "The traditionaol media industry doesn't need to play catch-up; they need to reinvent themselves." I believe this is becuase "opinion" has long overtaken "journalism."
- "A lie won't stay a secret for long in his consumer powered web." I find it unfathomable that politicians, celebrities or business people would behave illegally/unethically/immorally and expect to get away with it in this day and age. I blame it on hubris, or utter lack of judgement.
- "Value isn't static." This will be something I ponder going forward.
- "The 6V's." The idea was compelling, though I wonder how broad an adoption the concept has had
Tuesday, June 7, 2011
Le Premier Blog
Well, pretty exciting foray into the blogging world I've read so much about... Allez, au boulot!
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