Paul Wallbank | Paul Wallbank - Communications Professional

Facebook timelines and the long tail

Can the Internet’s long tail work for small business?

The Financial Times’ Tech Hub blog reports how Facebook’s Timeline function is driving views to old newspaper articles to unexpected stories.

On one level, this is a vindication of Wired Magazine editor Chris Anderson’s Long Tail theory of the value of older inventory; that older assets and data become more valuable in an age of unlimited choice.

The question remains though just have valuable old news really is, does the digital equivalent of fish and chip wrapping really have any intrinsic value.

It will probably turn out that information consumers will pay for unique, timely content while leaving the lolcats and funny videos to ad supported content farms.

The long tail model is the digital equivalent of the Fast Moving Consumer Goods business model, just as a big supermarket only makes pennies from each can of baked beans or milk they sell, they make big profits due to the volume they move.

As business writer Seth Godin has put it, the long tail is good for organisations that own big warehouses, and newspapers have the news equivalent of that.

For small businesses, the long tail is not where we need to be, our economics mean margin, not volume.

The evolving business

Sometimes we have to disappoint old customers and fans

“Maybe people are less interested in what you do now,” said a listener after November’s Weekend computer spot, “I’d like to hear more about buying new computers.”

The listener was commenting that he didn’t find what I speak about interesting any more and that I don’t spend time updating the PC Rescue website.

What the well intentioned commenter didn’t understand is that businesses, and their owners, evolve in order to survive and stay sane.

In my case, I have the idiot savant’s ability to retain miscellaneous facts and see patterns. This works well in IT support and comes in handy when answering technical questions on radio talkback programs.

Those skills were so useful that the success of the programs and online columns distracted me from my own five year business plan. When I belatedly realised the business wasn’t meeting my personal objectives I moved on from the day to day operations of the organisation.

Another problem for being an on-air tech guru is that while there’s a demand for experts to answer computer questions, not many people want to pay for that advice meaning there isn’t really a market.

Indeed, giving complimentary advice had the perverse effect of damaging my own personal brand with the market, such as it is, believing I’d do everything for free, something my long suffering call centre had to battle with constantly (sorry Yvonne and Ash).

When it becomes apparent things aren’t working like we intended, it’s time to look at what we’re doing and figure out another course. Einstein said “insanity is doing the same thing, over and over again, but expecting different results.”

When we decide to change some of our old customers, fans and followers might be upset; but sometimes what’s best for us and our business in this changing world means we have to leave some behind.

Cloud Computing Explained: 702 Sydney Weekends

This month’s 702 Sydney Weekend spot looks at cloud computing.

What on earth is cloud computing? Is it just another IT buzzword or something that you can use in your home and business?

On the November 20 ABC Weekends show, Paul and Lex Marinos discussed what cloud computing is and how it can help you.

We also helped out listeners with various computer and tech questions, including the following;

Malware

Sue was caught out by the DNS Changer Trojan that was recently busted by the FBI. Probably the best fix for this is downloading and running the free Malwarebytes software.

Our IT Queries site has instructions on the somewhat convoluted process for removing this Trojan and other viruses from your computer.

Synchronising an iPhone with iCloud and Google Calendars

One advantage we have with the cloud is that it means you can use devices anywhere, however there is a bug where iPhone calendar functions aren’t synchronising with Google Calendar.

Unfortunately the problem is the iCloud and Google services aren’t compatible on the iphone so one has to be turned off.

If your preference is to use the Google services, then you will have to turn off the iCloud services through the iPhone’s settings app and turning off all of the calendar and contact settings.

You may then want to check your Google services are being synchronised through the iTunes settings.

Sharing data between laptops.

One of the advantages with networking is that you can share data between computers. Sonya wanted to know how she can setup her windows 7 laptops to share data to an external drive.

The best option is to use a Windows 7 compatible Network Area Storage device that sits on the network.

For the setup to work, the network name has to be the same on all three devices, Microsoft has instructions for setting Windows7 network name and the hard drive will have the instructions included for setting it up correctly.

It’s also worthwhile using Microsoft’s Active Sync software to synchronise machines as well so you have files stored on your computer.

If you missed Sunday’s ABC program, there’s more details at Netsmarts’ Cloud Computing explained and The Networked Business, we’ll also be running a Demystifying the Cloud webinar on the Australian Businesswomen’s Network at the end of November.

That will probably be the last ABC 702 Weekends spot for 2011 unless there’s something else that comes up.

Subscribers to our newsletter get early notice of any upcoming programs and other useful information on getting more value online. Don’t miss the next program.

Reaching connected communites

How do associations and clubs make sure they are visible on the web.

As our homes and communities become more connected, people are expecting to find all their information online. How do associations and clubs make sure they are visible on the web.

This is the transcript of the opening keynote to the Australian Seniors Computer Clubs Association’s 2011 conference. The accompanying slideshow is available on Slideshare.

Reaching Connected Communities

Thank you very much for the kind introduction and the opportunity to open Australian Seniors Computer Clubs Association’s 2011 conference.

We’re in a time of history where all of us have the planet’s information at our fingertips and the ability to broadcast our own views and beliefs to the world.

Increasingly our roles as productive members of society are determined by our access to that information and our ability to use it.

Seniors computer clubs have a critical role in ensuring older generations have the opportunity to contribute to the connected society of the 21^st Century.

The problem for clubs is that all of us struggle to be heard through the noise of the online world. This morning we’ll have a look at what tools computer clubs can use to stake their claim on the Internet and be found on the web.

It isn’t just clubs affected by this, many of the traditional models of media and business are struggling with these changes and this presents opportunities for computer clubs and community organisations.

Underlying the use of these tools there are the principles that I call the four C’s –community, collaboration, conversations and communications.

Communications

Of the four, communications is the most traditional area. We need to be talking to those who need our assistance.

We have to be telling people how we can help them, what our services are and of course when and where the clubs meet.

In a traditional way, we advertised, or had articles put into the local papers and other publications. These channels are evolving in the digital era and are important to clubs as the people you want to reach out to are those who aren’t using the web effectively.

We also have newer communications platforms in local search, mobile apps and social media.

All of these channels complement each other and allow us to post relevant and timely messages that keep members and the public up to date with key issues.

With search engines and social media now the main ways that people research and find information, it is more important than ever that clubs have a legitimate online presence.

Communications isn’t just about getting the message across, it’s also about working together and many of the cloud and social media tools like Google+, GoToWebinar and Webex allow us to have conversations with the housebound and dispersed groups.

Conversations

Traditional broadcast methods of communicating do not encourage conversations. If you want to have your voice heard in the local paper you have to write a letter to the editor which may take weeks to be published, if at all.

In reality there was no conversation. The owner of the printing press or broadcasting licence controlled the message and who was allowed in the discussion.

Today’s online tools today allow us to talk to our audience. This is a great advantage for community and volunteer groups.

This is something that big companies and governments, with respect to the minister, struggle with and it is where computer clubs and other community organisations will increasingly carry out an important role.

Collaboration

One of the traditional problems with volunteer groups is that much of the work fell on one or two individuals. The cloud computing tools of today mean groups can collaborate far better and take the load off key members.

Tools like Google Docs, Dropbox and WordPress mean that the load can be shared among a group and no longer has to rely on one person to update the website or complete meeting minutes.

These cloud computing tools allow clubs to work together better internally, improve efficiency and engage more effectively with their communities.

Community

The most important part of clubs is communities.

One of the problems we’ve seen in the 20^th Century is that the rise of the motor car and broadcast media fragmented our communities.

Online tools, particularly social media, will work to bring communities back together, a process that’s going to accelerate as the era of cheap credit ends and the limitations of government are going to become apparent.

The tools

So what are the tools we can use for our clubs. I’m going to run through some basic ones. This is by no means a definitive list and you may find alternative tools that suit your organisation’s needs better.

These are listed on my website and at the end of my presentation I’ll give the web addresses to this presentation online so you don’t have to write down the scripts.

We’ll look at social media platforms, web publishing services and local search. First let’s look at the collaboration tools that help clubs deliver a better message to the community.

Google Apps

Google Apps, which is free for organisations with less than ten users, is a really handy service that offers basic word processing, spreadsheets and presentation software.

Its great strength is the ability to share those documents, spreadsheets and presentation with other users who can all work on them at the same time.

Google Docs also has a form feature which allows you to setup quick and ready surveys, feedback and booking forms.

Other similar tools are Zoho and Office365 which both offer collaboration and sharing features.

Dropbox

Dropbox, and its competitors Box.net and Microsoft’s SkyDrive, are great tools for sharing files between computers and collaborative teams.

These services allow you to create folders on an Internet service that you can then securely share with other people. It makes working on projects very easy and eliminates the shuffle of email attachments around groups.

If you are using these tools you don’t need to be converted about them.

Mailchimp

Mailchimp is the sanity saviour of small businesses and community organisations wanting to get newsletters out.

Managing a mailing list is hard work and these services take the hard work out of them as well as make sure your organisation complies with the spam act.

The service offers templates and sophisticated management tools so you can see who is opening your newsletters and what links they are clicking.

Survey Monkey

Survey monkey helps organisations keep in touch with their members and understand their needs. It’s a great tool for measuring customer satisfaction and feedback.

Google Apps has a more basic survey function built into it as well.

Both are excellent ways of keeping your membership in the loop when it comes to agreeing on new ideas.

Local Search

Local search is changing the way we do business.

Consumers using local as they abandon phone directories and classified ads as the net is a quicker more effective way of searching.

These local search results not only appear at the top of the page but they also feed into the popular social media services.

All organisations, local or otherwise should be listing on these not just to improve their search results but to also appear on other services and on devices like GPS systems.

If you have a relative or friend running a business I’d urge them to list on all of these services as this is an area that is seriously changing the business landscape.

Google Places

It is essential to be listed on Google Places as this will appear at the top of a local search and feeds into other social media and services like street directories and GPS navigators.

Ensure you fill in as many fields as possible, especially the times and days you are open and contact details.

Use the custom fields to improve your keywords and give a richer description of who you are.

You can also upload photos and videos which will improve your search results along with give visitors more information about what you do.

True Local

News Limited’s answer to Google Local ties into News’ local newspaper network.

True Local charges for some functions that are free in Google Places and offers additional free services like the ability to upload Word and PDF documents.

Sensis

Sensis is digital roadkill, the most common complaint with the print edition now is that it’s too small to read and the phone book doesn’t make a good monitor stand anymore.

However, Sensis’ free listing is important as it feeds into NineMSN’s search which is the default on Windows computers.

You’ll also receive a free listing in the printed Yellow Pages for what it’s worth, which to be fair is probably where the most digitally challenged folk will find you.

Social Media

In recent years we’ve been lead to believe that social media is something bigger than the industrial revolution that will cure various tropical diseases, rescue broken business models and make a cup of tea for you in the morning.

The reality is social media is changing the way communities and markets communicate. It’s the 21^st Century’s town square or village tavern.

Social media services are great for driving traffic to your site and excellent for listening to trends, monitoring news and talking to your community. They are also the greatest driver for people getting online.

Facebook

Contrary to stereotypes, the fastest growing group among Facebook’s 800 million users are seniors.

This is the biggest opportunity for clubs as the late adopters – the sceptics who’ve resisted going online are now doing so, if only to talk to their grandkids.

There’s a view that Facebook, and most other social media services, are for teenagers putting up pictures of cats and talking about what they did last weekend. That’s wrong on many levels as the service cuts across all demographics and groups.

Facebook Pages

Like a Google Places page, a Facebook Page is free and vital to clubs and businesses. If you have relatives running a business, they should also sign up for a free site.

Increasingly this is where the public goes to online and we have to be there. You can also add events and publicise them through these pages. Your community can contribute and share to your page.

Get 25 members to like your page and you can claim the full name as well.

Google+

Like Facebook, Google+ has a free pages function for community groups and pages. However it remains to be seen how much traction Google+ will get as the service develops.

Google itself seems to be confused about what Google+ actually is, Eric Schmidt, Google’s chairman, calls it an identity service rather than a social media platform. This confusion of what Google Plus actually is doesn’t fill me with optimism on the service’s future.

Apart from the social aspect, Google+ has some interesting collaboration tools such as Hangouts, that allow ten people to work together. If you have a webcam installed, and most new systems come with one, you can set up a group for training or collaboration.

Along with Google+ there are other webinar programs such as GoToWebinar or Webex and Skype’s conferencing feature does a very job at this as well.

Twitter

As a conversational and listening tool Twitter is excellent, although it has been largely mis-sold by the social media business community as a marketing and PR tool.

Twitter allows you to be ahead of the news cycle as most journalists use it to find stories. My own use of Twitter is as a news source.

It’s a good way of keeping up to date on what is happening in communities and with connecting with individual journalists and opinion makers.

Own your platform

The website is your site and your property. Overlooked the dangers of not owning the space you are publishing on.

Websites have become easier to use and build. It you’re using a service like Blogger or WordPress you can get a site running for as little as seven dollars a year and you can be delegating access to various members of the group.

Your website is the centre of your online presence and your home base in the digital economy.

Blogger

Blogger – Google’s free blogging service – is a great tool for getting a website running.

Easy to use, with dozens of templates and plugins for services like e-commerce, newsletters, social media and events it’s an effective and quick way to get a website running.

You can also use your own business domain name for free. Which means you can get online for under $50 a year.

WordPress

WordPress is the most popular web content management system. Offering a vast number of templates and plug ins with the advantage of a big community of developers to support the product.

The software also allows an easy upgrade path to other services like Drupal.

Not business as usual

This is not business as usual.

Many of our business and political users are locked into 1980s ideologies and business models that are rapidly being challenged.

In the media we have a whole generation of journalists who are seeing their careers being twisted out of shape by forces they don’t recognise, something that has already happened to the record industry that thought it could use the old business model of developing new technologies that would extend their playlists in the way the LP had in the 1970s and CD in the 1980s.

We see this in the consumer goods industries where old business models are being challenged.

Earlier this year Bernie Brooks, the chief executive of Myer, signed a deal with one of China’s biggest contract manufacturers to make Myer’s homebrand clothes.

The problem with this is it’s the 1980s model. Today consumers can research these things and they will quickly figure out that Myer’s $200 branded shoes are made in the same factory and little different from those you can by for $50 at Target or Lowes.

This mindset illustrates the problems of established businesses and it’s no problem that Coles and Harvey Norman are campaiging to obstruct online shopping in an environment where the informed consumer is able to circumvent the old distribution and retail models.

In many ways these are modern equivalents of the stagecoach operators and it’s no co-incidence that a hundred years ago this year that Cobb & Co went broke. This is risk that any business runs when it is unfortunate to have managers who ignore trends.

Addressing the digital divide

Seniors computer clubs have an important part in today’s society.

The real digital divide is not across age, it is not between “digital natives” and “digital immigrants”, the real divide is between those who are prepared to understand and use these online tools and those who won’t.

Those who won’t are going to be increasingly isolated from a world that is going online. At a time where we’re seeing the NBN rolled out, the launch of 4G networks and increasing use of the web by business and government agencies it’s going to be essential to have some knowledge of the online world and the tools to use it.

Being on the wrong side of the divide will make it increasingly hard to access services and information.

The role of groups like the local seniors’ computer group is to help people remain valued and productive members of our community in today’s connected society.

Hopefully I’ve given you some ideas this morning on how to carry out the important role you have in this decade of great change.

So you want a business grant?

The promise of free government money is seductive, but is it real?

“Funding Available from $1000 to $500,000! Get an advantage over your competitors or give your business the Government Funding boost it needs to be more successful!” Is the promise of a website offering to find grants for your business.

Free money from the government sounds good and, as we’ve seen in the various Quantative Erasings and bank bail outs around the world, it sometimes is free.

Rarely though is cash really “free”, usually there’s strings attached and government money is no different.

Why do governments give business grants?

First we should understand why governments make grants, subsidies and loans available to businesses.

Governments have various objectives with their programs; they could be to get unemployed workers back in the workforce, to improve skill levels or to encourage exports. Whatever the motives are, they have clear criteria for giving money away.

One area they don’t give funds for is to “Get an advantage over your competitors” as that website. That’s clearly not the role for governments and they’d be rightly criticised for doing so.

The paperwork storm

Contrary to what some media outlets portray, most public servants take their responsibilities seriously and don’t give out taxpayers’ money unless the application clearly meets their programs’ objectives.

Meeting the objectives is important, because the public servants – and their political masters – are held accountable so they will make sure the business receiving the grant or subsidy has actually done what they have promised to do.

This is where things get tricky for business owners and managers who have received government money. Completing the paperwork to prove you’ve met the objectives will be time consuming.

Drive a cab

Often it would have been more cost effective to drive a cab rather than spend hours filling in government paperwork.

There really is no such thing as free money, there’s always a cost. While sometimes there are good reasons for applying for a government program, free money should never be your objective.

It’s also worth keeping in mind that services offering to find government money for you will usually take a cut of the grant as commission. Also, they won’t help you do the follow up paperwork, that’s your expensive problem.

The dummy email address

Are you protecting your details or missing opportunities?

A little while ago I was lucky to hear an excellent, well informed speaker give a great presentation.

Following the talk, myself and a few others were able to grab him and have a quick chat before he vanished out the door. When we exchanged business cards it was noticeable how he carefully chose careful which of his cards to give us.

Later I sent a follow up email thanking him for his presentation and was surprised to receive a “not known at this address” reply.

As someone who’s used to being given fake phone numbers scrawled on beer coasters, this is not an unknown disappointment but it was still surprising to receive it from a professional.

For busy people it’s understandable not wanting to give out a personal email address to someone you barely know. But giving a bogus address seems to be very risky.

In my case, it’s just a matter of slightly hurt feelings, although I wonder how many opportunities that person misses because they misjudge the value of the person they are speaking to.

A better option is to have a professional email address that your personal assistant monitors and deals with as they see appropriately.

Manners, respect and not burning down bridges before you’ve even approached them are all good ways of working in the business world.

Is your business killing you?

Building businesses can hurt your health.

It’s hard work running a business and often we hear stories of the tycoon who drops dead from a heart attack or finds themselves divorced, friendless and penniless at the end of many hardworking years in building up their venture.

Being an entrepreneur means you live in your business as much as work in it, but it if we’re not careful it can kill us.

Know your finances

There are some who believe that a business plan and cash flow projection are unnecessary, they are wrong and at best are falling for survivor bias.

Insufficient capital is the main reason why good businesses fail, it’s also the leading cause for marital breakdowns and the failure of business or personal relationships.

Not understanding your finances means you have no idea whether your business is really profitable or if those returns are sustainable. If you don’t realise the cash position of your venture than you are at real risk if there’s an unexpected change in the market should an unexpected event like sickness or a tax bill arrive.

Take a break

If you don’t take an occasional vacation you are at risk of genuinely going mad. You need some time away from the grind to recharge your batteries.

Getting away from daily work issues also helps your business as it’s an opportunity to see the wider perspective of the markets and society you operate in.

Exercise

Many of us don’t get time to exercise, which starts to slow us down both physically and mentally. Even if our businesses are a success, we may not have the health to enjoy the benefits. Remember the guys who die of a heart attack at 50.

Eating

Coupled with not exercising is having a bad diet, because we don’t have time to eat well we often end up eating convenient junk or not have a balanced diet. Take time to grab a healthy breakfast and lunch.

Poor work practices

When we stressed, racing to get a job done or under pressure, we often take shortcuts or break regulations. This can be anything from a truck driver not respecting driving time limits, a plumber not lifting heavy goods properly through to a consultant not changing the tyres on their car because they didn’t have time to be off the road.

Either way, not respecting safe working practices can be catastrophic for the business person and those around them.

Have an objective

Your business plan should have objectives for your business on a 12-month, one year and three year horizon along with an exit plan.

An exit plan could be building great apps, revolutionising your industry, amassing a retirement nest egg, handing the operation to the kids, franchising the business, a stock market float or making a trade sale.

Whatever your reasons for being in business are, having a clear objective to work towards helps guide you through the morass of daily tasks in running a business.

Ditch the negative people

Whingeing, whining negative customers will drag you down, similarly with business partners and employees who will bitch and moan about customers, the government or staff. Successful businesses are run by optimistic people.

Be objective

The flip side to negativity is undue optimism and a lack of objectivity. It pays to have a realistic view of where a business is going and often that vacation helps you get the objective view needed.

When you get a great business idea it can difficult to let go, so that’s why we need the ability to step back and understand who we are, why we are doing this and where we’re going with the project.

Even if our businesses are successful, we need to be a position to enjoy the hard work and return on our labour.

Is Google drowning business?

Are there too many online services?

The launch of a pages function for Google+ allowing businesses to create a profile on Google’s social media and identity management service is welcome.

What jumps out immediately is there is no integration with Google Local, meaning that businesses will have to create another online profile and learn the nuances of it.

Right now big and small businesses are being confused by the proliferation of online tools and the problem is made worse by advisors maintaining you have to be on each service actively talking to your customers. That’s nice for a corporation with unlimited funds and resources but a tough ask in the real business world.

By adding another service – that doesn’t integrate with Google’s myriad of services let alone outside platforms like WordPress, Facebook and Twitter – Google are making it hard for businesses to allocate the time and resources to the online world.

What’s more, the terminology is confusing; Google’s rebranding of Local to Places started this and now we’ll see business owners and managers confusing Google+ Pages with Google Places.

That confusion will be understandable as right now the terminology between the two overlaps and it will be difficult to explain the difference to business people who have many other issues to worry about along with this.

One thing we can be sure of is there will be a whole range of strategies tied into Google+ Pages that might, or might not, affect search engine results and – given the ongoing nymwars debacle and the similar mess with Google Places listings – there’s a strong likelihood this program is going to get bogged down in opaque bureaucratic procedures.

It seems different divisions within Google are running their own races; Adwords isn’t talking to Blogger, Analytics aren’t talking to Local and the team running Google+ are taking advantage of senior management’s obsession with social at the expense of Google’s core competencies and their advantages in the local and mobile sectors.

Right now businesses are struggling with the plethora of online services and how to use them in their organisations, Google have to break down their own silos and start integrating their services to make it easier for managers, entrepreneurs and proprietors to use these platforms.

Mad, bad or dangerous: The One Percenters we need to avoid

There is a certain type of customer business need to be careful of.

“I’m not going pay you, your technician was constantly looking at his watch,” growled the customer when asked why she’d stopped a cheque for some work we’d done for her.

There’s many excuses for not paying your bills but a tradesman trying to keep the client’s bill to a minimum is an excellent dodge.

Over the phone call’s ten minutes, it was clear this lady was going to be a tough customer.

First the job wasn’t done properly, then the charges were too high, she accused us of taking advantage of vulnerable women and finally she was going to complain about us to her union.

It was clear we were in for a fight to get a hundred dollars from her, so I let it go. She went away believing she was right.

The saying “the customer is always right” was coined by US retail pioneer Marshall Field and exported around the world by Harry Selfridge, one of his employees who also founded a business empire.

We can be sure neither of them actually meant that customers are always correct in what they do, just that the key to successful service is the client walking away believing they are right.

Regardless of how well we deliver on our promises, there are always going to be some that aren’t happy. In most cases this is due to misunderstanding, or just a bad day on our part, but sometimes there’s the one percent of customers who are mad, bad or dangerous.

The Mad

Some customers just aren’t quite with us. These people, some of whom have genuine psychological problems, simply aren’t going to be reasonable.

There’s no point in fighting them as that’s only going to make their issues worse and maybe even transfer some of their problems to you.

Fortunately as you become more experienced in business you get better at detecting and avoiding these type of customers although there’s always the odd one who sneaks through.

The Bad

There’s a certain breed of people – and businesses – who don’t pay their bills, seeing their suppliers as banks and an invoice as an interest free loan.

Often these customers are charming and the perfect client before the bill is presented then they string you out for months of years before paying your invoices.

For these people and organisations, who are genuine deadbeats, there’s the fool me once, shame on you; fool me twice, shame on me philosophy. It’s usually better to write them off rather than sink hours of management time.

The Dangerous

Of all the bad payers, the most dangerous is the game player. To these people, not paying debts is an intellectual challenge which they enjoy and play for fun.

These folk will just as happily mess around the phone company or the tax office as much as the local plumber or newsagent, it’s just a game which they’ll play to their maximum enjoyment and your frustration.

For the big companies, these people can be a benefit as they justify the existing of entire bureaucracies dedicated in getting them to pay; small business though don’t have the time and resources to spend the hours of work over years to extract payment from them.

Thankfully these folk usually stonewall as the first invoice so there’s early warnings you’re dealing with trouble. Resist the urge to play the game with them as they are usually better at it than you.

Regardless of which category these bad debtors fall into, in each case it’s better for your valuable time and sanity to let them believe they are right, write the debt off and move on to helping customers who really matter.

Fortunately these people really are the One Percenters and only representative of a tiny proportion of our customers.

The taste of copping a loss is always painful, but at least we get good stories from the excuses they give. What’s the best reason you’ve heard for a customer trying to dodge a debt?

What business can learn from Groupon

How can businesses use the web to grow like the group buying companies?

Groupon, pioneer of group buying and one the fastest growing companies in history, will have its launch on the stock markets today with an initial public offering (IPO) that’s values the business at thirteen billion dollars, more double the $6bn that Google offered for the three year old company last year.

A recent Business Insider profile of Groupon had some fascinating insights on this unique company and its growth, there’s a number of lessons that most business owners, entrepreneurs and managers can take from this company’s dramatic growth and market leadership regardless of the sector they operate in.

Apply tech to your business

Many people make the mistake that Groupon is tech startup when it’s actually a sales operation.

Groupon’s business model isn’t really new, what they have done is applied various web technologies to the directory and voucher shopping industries and come up with a 21st Century way of doing things.

Bringing together different modern tools like social media, cloud computing, local search and the mobile web makes businesses more flexible and quick to develop new market opportunities.

Prepare for quick changes

Groupon was born out of another business – The Point. As The Point steadily died, Andrew Mason and his mentor Eric Lefkofsky decided to try something different and Groupon was born.

This ability to change focus quickly – often called “pivoting” – is essential in changing markets. In volatile times like today where today’s business conditions can’t be taken for granted we have to be prepared for rapid changes.

Fortunately the cost and time to changes your business focus has dropped dramatically with digital and online tools, which is another reason to embrace tech.

Get a good business mentor

Eric Lefkofsky bought maturity and a perspective to Groupon’s young leadership, having a different and more experienced view of the business helped it develop and grab the opportunity.

An experienced business mentor can be worth their weight in gold.

Back a good idea

In Nicholas Carson’s Business Insider profile he describes Andrew Mason role at Eric Lefkofski’s business before The Point as “an intern, ‘kind of squatting in their offices'”. Lefkofski was prepared to back the geeky kid camping on his premises.

Putting your prejudices and judgements on the shelf to back good ideas, particularly those that don’t cost much to execute, is one way to find where the opportunities lie.

Tell your business story

Regardless of what you think of Groupon’s claims, they tell a very good story which has lead to their amazing growth and the development of the group buying industry.

Being able to tell your story, in your terms, is one of the great advantages the web, local search and social media deliver. There’s no reason why your business shouldn’t be dominating the local market in whatever field you work in.

Regardless of what your business does, it can benefit from applying the online tools that are available to all of us.

We may not be the next Groupon but the web gives us the opportunity to build our business to take advantage of the 21st Century. It’s worthwhile understanding the new tools at our fingertips.

The IT industry’s damaged business models

Can the Information Technology industry deal with a radically changed business environment?

JT Wang, Chairman of personal computer manufacturer Acer believes the release of Windows 8, Microsoft’s next operating system, will see a resurgence of sales for Windows based computers. Market trends suggest those hopes are in vain.

Right now the Personal Computer market can be roughly split into two camps; those happily running Windows XP who have no need to upgrade and those who are delighted with Windows 7 who have no need to upgrade.

Short of their computers breaking down, neither group have any good reasons to change to the new operating system as, unlike Windows 3.1, 95 or XP, there is no new technology breakthrough or advance to warrant making the jump.

To make things worse for the PC manufacturers the rise of cloud computing services extends the life of older Windows XP systems and eliminates the biggest driver of new computer purchases in businesses – the software upgrade.

During the PC era one of the banes of business owners were enforced software upgrades where vendors would release a new version of a program every year or two and withdraw support for the older editions.

Frequently the newer software would require the latest hardware, forcing the business into an expensive and disruptive upgrade of all their IT systems.

Today, software companies following the forced upgrade model are finding customers have viable cloud alternatives which destroys the revenue stream behind those frequent releases.

When a customer moves to a cloud service, they also delay buying new desktop or server hardware which is partly driving the steady increase in the age of business computers.

For computer manufacturers the release of Windows 8 could actually be bad news as customers will probably postpone system upgrades until the first service pack of the new operating system is released.

Even if Windows 8 does deliver increased sales as JT Wang hopes, the trend of steadily falling PC prices as smartphones and tablet computers take market share is inevitable.

The PC industry in both laptops and desktops has been a commodity industry for some years and any hope of establishing premium pricing from tablet computers has been dashed by the iPad’s competitive price points.

Regardless of the hopes of the IT industry’s leaders, both the hardware and software sectors are under a lot of stress. It will be interesting to see who adapts to today’s market.