Tag: social media

  • Re-evaluating social media

    Re-evaluating social media

    We often forget the Internet as we know it is less than thirty years old and many of the social media tools we use have been around for less than five.

    In such a new field, we’re all learning and experimenting which means some tools become essential while others are recognised as yesterday’s shiny toys.

    As the depth of the name wars and the related privacy issues become apparent, it’s worthwhile re-evaluating how we use these services. Here’s how I’m now using some of the online social media platforms.

    Foursquare

    I quite like Foursquare, the idea of knowing which friends are nearby when you’re out on the town is great. But as someone who has a dismal social life, it was wasted on me.

    The gamification angle is interesting, but the privacy implications of the service make me uneasy. I’ve stopped checking in and will probably close down my account pretty soon.

    Empire Avenue

    As a sociological experiment on the rampant egos and deep insecurities of the social media community, Empire Avenue is wonderful. Otherwise, it’s just another spammy online application trying to harvest personal information – I came, I saw, I decided life was too short.

    Quora

    On first glance, Quora looked good, but the changing of posts by moderators concerned me, the cliqueiness of users was the killer and I closed my account. I suspect Google Plus will kill this platform.

    Google Plus

    Apart from being a Quora killer and having some interesting collaboration feature, there doesn’t seem to be a compelling reason to use Google Plus instead of Facebook.

    While it’s in its early days, I’m finding it less than compelling while Eric Schmidt’s claim it is an identity service rather than a social media platform deeply unsettles me and makes me less likely to engage in conversations on the service.

    Facebook

    When Facebook first became available I was intrigued as able to connect with relatives along with past and present friends always struck me as being one of the Internet’s killer apps. As various business features evolved, it was clear Facebook was a serious online tool.

    The problem with Facebook has been the way strangers become friends, not to mention how acquaintances and relatives have a habit of posting private things you don’t particularly care to know about, along with the wave of invites to games and applications that come and go.

    Overall, I’ve been using Facebook for business purposes rather than sharing private information for nearly two years now. That works, but it isn’t the intended use and I’m probably not getting the maximum benefit although I am preserving some modest degree of privacy.

    Linkedin

    As a means to establish your professional credibility, LinkedIn is unbeatable. For those with a lot of time, the various professional LinkedIn groups can be a valuable way to show your industry knowledge.

    One thing that surprises me is how many people notice your status changes so it is certainly a good way of keeping your business network up to date with what you are doing.

    The concern with LinkedIn is similar to Facebook and Google Plus in that there’s a lot of market intelligence being gathered on our professional networks and the recent attempt to ‘enhance’ social advertising around our online personas does not fill me with confidence that LinkedIn is the best platform to be displaying our professional abilities.

    Twitter

    I’ve had a turbulent relationship with Twitter and it took me three attempts to really see the point. I’m still careful about what I post and who I follow.

    However Twitter has become my main news source and I find it keeps me ahead of the major media outlets. For this reason alone, Twitter has become the social media service I use the most.

    What occurs to me in writing this is that these social media tools are really about listening, not talking or marketing. Perhaps that is the point we’re missing in the noise generated by these services, that listening is where the real power lies in these online platforms.

    The six tools I’ve listed are just a small subset of a massive range of social media services, I’d be interested in hearing which ones you find useful and why.

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  • How Google’s identity obsession hurts

    How Google’s identity obsession hurts

    Imagine giving a presentation at a conference where you fire up a live demonstration of a product you’ve been urging the audience to use and the audience start giggling.

    You turn around to find a bright red message at the top of the screen stating your account has been suspended. It wasn’t there the night before and you certainly didn’t receive an email warning you this had happened.

    Embarrassing or what?

    That happened to me with Google Local earlier this and the many stories like it illustrates a serious management problem within the world’s biggest search engine company.

    Local search – where businesses can be found online based on their location – is one of the main web battlefields with Google and Facebook, along with outliers like News Limited and Microsoft, are competing to get business of all sizes to sign up.

    Recently though Google seems to be going out of its way to squander the massive opportunity they have in this sector despite the CEO, Larry Page, identifying local services as one of their priorities.

    Despite Google’s intention to promote Places – as their, and Facebook’s, local search platforms are called – many businesses are finding the company’s arbitrary and often incorrect application of its own rules and Terms of Service difficult to understand and use.

    “I have found that with the ‘moving target’ Google is presenting to businesses” said Bob, a commenter on one of my blogs, “is paralyzing them from doing exactly what Google wants, which is updating and providing fresh content on their listings pages.”

    In many ways, this is a small front on the “nymwars” that has broken out since Google introduced their Plus social media service and started enforcing their “rules” on “real names”.

    Unfortunately their real names “policy” – and I use inverted commas deliberately – is vague and arbitrary with users finding their accounts suspended despite signing up with “the name your friends, family or co-workers usually call you” as required by Google.

    Account suspensions are wide and varied; some people, quite legally, have a name without a surname, others have a combination of languages such as Chinese or Arabic, while others have simply fallen foul of the computer and Google’s secretive bureaucratic culture.

    This secretive bureaucracy would be funny if it wasn’t so downright hypocritical. Any correspondence with Google about account suspensions either on Places or Plus is signed off by an anonymous functionary from “no-reply” email address. So it appears real identities, and accountability, don’t extend to the company itself.

    Last week at the Edinburgh International TV Festival, Google’s chairman Eric Schmidt, announced Plus is not a social media platform, but an “identity service”. Good luck with that, Eric as your staff’s arbitrary and often incorrect interpretation of the company’s own rules doesn’t engender confidence in any identity verified by Google.

    That announcement by Google’s chairman should worry investors, as this is a company that is first and foremost an advertising company powered by the best web search technology.

    Management distractions such as becoming an “identity service” or buying a handset manufacturer distract focus from the core business and result in the mess we’re seeing around business and private accounts.

    For the moment, Google Places remains a service that businesses must list on given the visibility the results have when customers search the web for local services and products.

    If you aren’t already on Google Places, do sign up but make sure you get your listing right first time as editing your profile once it’s up risks your account being suspended or cast into “pending” purgatory.

    Should you have already an account, leave it alone as any change risks coming the attention of Google’s anonymous bureaucrats.

    Hopefully, this madness will pass and Google will clarify their policies, ground them in the real world then enforce their terms fairly and consistently. Until then, you can’t afford to rely on your personal and business Google accounts.

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  • Online tools to turbocharge your business

    Online tools to turbocharge your business

    Flying Solo’s 2011 Independents Day conference featured our Online Tools to Turbocharge your Business.

    We looked at some of the most popular cloud computing, social media, productivity and collaboration tools that can help a business make more money and grow faster.

    Most importantly, it shows how business owners can free up some of their most valuable asset – their time.

    Some of the tools we discussed include the popular social media platforms like Facebook, LinkedIn and how they can be used for customer service and market intelligence on top of being marketing services.

    We also looked at how collaborative and cloud computing services can help small businesses work together and improve the ways consultants can work with big business clients. In many ways, collaborative tools like Google Apps, Zoho and Dropbox help build team and deliver projects more effectively.

    The Online Tools to Turbocharge Your Business presentation itself is available on Slideshare and if you subscribe to our newsletter, you’ll receive a free copy of the accompanying Online Business Essentials e-book.

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  • The web’s big weakness

    The web’s big weakness

    There’s a fundamental flaw in the way the tech industry does business, that weakness could be what ultimately kills many of today’s new media, web and social media services.

    AirBnB, an online home share service, is one of the darlings of the booming Silicon Valley start up sector, having recently being valued at $1.2 billion after a successful capital raising.

    Like most Web 2.0 and social media businesses, AirBnB’s advantage is in the low operating costs where customer support is left to the service’s peer review and social media communities while AirBnB pockets a commission for simply making the connection between the landlord and tenant.

    The flaws in this “all care, no responsibility” model became apparent last month when a lady posted a description of her house being ransacked by an errant housesitter she found through AirBnB.

    AirBnB’s management responded to the article with assurances they were helping and working with their affected customer, claims which were promptly contradicted by the original victim.

    To make matters worse, certain prominent members of the Silicon Valley investment and blogging communities alluded she was lying or was “batshit crazy.” Now that other stories of bad AirBnB tenants are appearing, the view this is simply the untrustworthy word of a deranged customer affected by their first such incident is looking hollow.

    Failing to deal with customer problems is not unique to AirBnB, hiding behind impenetrable layers of “support” backed up by user hostile terms and conditions is familiar to anyone who has had to deal with an online service gone wrong.

    Last month Thomas Monopoly found he was locked out of his Google account and had it not been for the intervention of a senior Google employee, Thomas’ problem would probably still be stuck in an endless feedback loop.

    Exactly the same problem has been encountered thousands of times by other users of web mail, social media, online auction and matchmaking sites.

    Many of the people running these services retort their products are free so users get the support the support they pay for – an argument conveniently overlooking that most “free” web services are based around selling customer data – but even this does not justify delivering the basic services users have been lead to expect, regardless of what a 5,000 word user agreement states.

    Today’s tech startups, and many of their big established cousins in the IT industry, have the idea that customer support is an optional extra and an expense to minimised or outsourced.

    In this respect they are not too far removed from dinosaur car manufacturers or some of today’s less dynamic retailers offering little in the way of customer service or after sales support.

    That way of working has died as consumers have been able to go online to vent their dissatisfaction, strangely today’s hot tech start ups seem to have missed this aspect of the revolution they have helped start.

    Ignoring consumer problems is exactly what’s bringing traditional businesses unstuck in the online world. The funny thing is it might bring many of the online business undone as well.

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  • Is Facebook worth $50 billon?

    Is Facebook worth $50 billon?

    Goldman Sachs’ recent $500 million investment in Facebook that values the entire business at fifty billion dollars raises the question, can a business that was founded in college dormitory seven years ago really be worth that sort of money?

    It is possible Facebook is worth that sort of money, but to figure out if it really is, we have to crunch some numbers. So here is a back of an envelope calculation.

    Learning from others

    The first thing we need to look at is similar examples, the closest comparison is Google who were launched on the stockmarket shortly after Facebook were founded and today have a market worth of $195  billion.

    So Facebook’s investors are valuing the business at about ¼ of Google’s size. Yahoo’s stock analysis of Google allows us to look at the rough numbers.

    Income

    Currently, Google is earning 29.3 Billion and making a profit of 8.5billion for a Price to Equity (P/E) of 23.26.

    To justify a 50 billion dollar valuation on similar rations, Facebook would have to make around 2 billions dollars profit on revenues of $8 billion .

    Facebook is reported to have made $1.2 billion in sales with $355 millon profit in the first nine months of 2010. If we extrapolate that, crudely assuming no revenue growth in the last 3 months, we come to 2020 earnings of $1.6 billion and roughly $450 million profit.

    So Facebook has to grow revenues and profit by a factor of five, based on the same ratios as Google, to achieve the $50bn valuation. Where could this come from?

    Advertising revenue

    The bulk of Facebook’s current revenue comes from advertising, according to Inside Facebook in 2009 all but $10million of their $660 million earnings came from one form of advertising or another.

    Online advertising is going to continue to grow spectacularly, a 2010 Morgan Stanley research paper illustrated (on slide 25 of the previous link) how advertisers will have to increase spending onling by $50 billion to match the Internet’s share of media consumption.

    It’s a fair assumption that Facebook, as the biggest social medial platform, will get a large slice of that $50 billion. If Facebook were to capture 10% of the market’s growth, they’d achieve their valuation easily.

    We should also consider that most of Facebook’s revenue is coming from the United States and they barely touched international markets, so there’s even more potential growth in their advertising revenue.

    Games revenue

    One of Facebook’s biggest growth opportunities comes from the games. Games like Farmville and Mafia Wars are proving popular with the user base; Zynga, the developer of Farmville, itself has a projected market capitalisation of $5.8 billion.

    The global games business is valued at $105 billion dollars and much of this market is moving to web based, online platforms. Should Facebook based games grab 10% of that market, the platform’s 30% cut would see another 3 billion go into Facebook’s revenue, most of which would be profit.

    The credits market

    Related to the games market is the sale of credits for purchases of games and other features like virtual, and real, gifts and products.

    It’s almost impossible to quantify what that market would be but already credits have gone on sale in US stores like WalMart and Best Buy and the virtual world site Habbo Hotel reports 2010 credit revenues of 4.5 million Euros on a user base that is a fraction of Facebook’s size.

    So is Facebook worth $50 Billion?

    Facebook’s fifty billion dollar valuation is feasible. That’s not to say there aren’t risks, it’s possible Facebook could turn out to be another fad like Myspace or that users might decide to value their privacy over Facebook’s benefits.

    While it’s not an investment you’d like to see your grandmother in as a safe source of retirement income, for risk tolerant Russian fund managers and high income clients of Goldman Sachs, it’s a punt worth taking.

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