Tag: web

On being a hater

A cheap slur hides real problems with online communities and anonymous comments.

The phenomenon of the “Internet hater” has been one of the unfortunate developments of the web.

Just as entry barriers for new businesses are low, so too are the restraints on clueless and anonymous idiots posting comments like “drop ded you faggot” or “hope you get canser bitch” onto web forums and social media pages.

English comedian Isabel Fay has a great rebuttal to the haters with a clip that co-opts some of Britain’s top comics with their experiences.

These haters are sad little people as the BBCs Panorama program found when it tracked down one individual who had posted offensive comments.

We knew Darren Burton of Cardiff, aka Nimrod Severen, would be a pathetic individual. Those who post anonymous, hateful comments are rarely anyone who has anything useful to contribute to society.

Online “haters” are a real problem and cause distress to people who encounter the foul comments these creatures post. However the “haters” tag is increasingly being misused to shut down fair comment and criticism.

Legitimate critics or dissenters from the groupthink and shallow advertorials that increasingly dominate parts of the web will quickly earn the tag “hater” as well.

Every multi level marketing spiv or con merchant with a few followers will quickly throw the term out at anyone who dares criticise their behaviour in the hope of rallying their followers to shout down the dissenters. Usually it works.

If you’re prepared to think outside the group and genuinely challenge those selling old rope as new ideas, let alone expose the hypocrisy of those who claim to open and transparent while hiding their real intentions, then be prepared to wear the tag “hater”.

The only reply is to stand on your beliefs and be prepared to use your real name. The real trolls are scared, frightened creatures – just like many of the useful idiots co-opted by the spin merchants and Internet spivs.

At least “hater” is just a cheap insult and they aren’t coming for dissenters with pitchforks. Yet.

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Monetizing the Masses

How do social media services make a profit?

Monetization is a horrible word.

The term is necessary though as many online business models are based upon giving away a service or information for free. For those businesses to survive, they have to find a way to “monetize” their user base.

When Google were floated in 2003, the question was how could a free search engine “monetize” their users. The answer was in advertising and Google today are the world’s biggest advertising platform.

Facebook’s Inital Public Offering (IPO) announcement raises the same question; how does a company valued 99 times earnings find a way to justify the faith of its investors?

Advertising is the obvious answer but that seems to flattening out as the company’s revenue growth is slowing in that space. The AdWords solution tends to favour Google more than publishers as most advertising supported websites have found.

Partnering with application developers like the game publisher Zynga is another solution. Again though this appears to be limited in revenue and Zynga itself seems to be having trouble growing its Facebook user numbers.

So the question for Facebook is “where will the profits come from?”

There’s no doubt the data store Facebook has accumulated is valuable but how the social media service can “monetize” this asset without upsetting their users is open to question.

For Facebook the stakes are high as the comparisons with Friendster and MySpace are already being drawn.

We’ll see more partnerships like the Facebook Anti-virus marketplace, but these seem to be marginal at best.

In the next few months things will get interesting as Facebook’s managers and investors strive to find ways to make a buck out of a billion users who don’t pay for the service.

While “monetization” is an ugly word, it is one that every online company thinks about.

Every web based businesses will be watching how Facebook manage their monetization strategy closely as the entire industry struggles with the faulty economics of providing services for free.

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Consumer surplus?

Inventing euphemisms for your dead business model

Last week I came across the term “consumer surplus”, the Boston Consulting Group claimed the gap between the cost of producing media content and what customers are prepared to pay creates a “consumer surplus”.

That consumers of media want it but aren’t prepared to pay for it is a basic truth; the 20th Century media model is based upon advertising subsiding journalism and entertainment.

For all forms of media this was true; from TV and radio stations being fully funded by advertising to newspapers and magazines’ cover prices barely covering distribution costs.

Take out advertising and all these models are dead. The only alternative is government funding.

Losing the advertising rivers of gold to web services is what’s killing the established business model. It appears that TV and radio will hang on, for now, but newspapers and magazines are in serious difficulties.

Simply put, there has rarely been a market for journalism; readers and viewers aren’t prepared to pay. Journalism’s golden years of the 20th Century were based upon having a relatively captive market for advertisers; now advertisers can go elsewhere, they have.

Putting a sophisticated  label on a basic concept is something consulting companies are very good at and Boston Consulting Group has done an excellent job with this report.

The fundamental truth is that it doesn’t matter how good your product is, if you can’t find a way to make someone pay you for it then you don’t have a market or a business.

Which is what the real challenge is for online content creators, finding the model that pays. The first person to do that becomes the 21st Century’s Randolph Hearst.

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A website can’t save a dying business

Online tools can’t fix an organisation’s structural problems

The last week has seen some interesting changes in the local online business community.

Embattled department store David Jones’ announced they are following Harvey Norman into an “omni channel strategy”.

Harvey Norman chief executive in turn appeared on national television to state the “internet drives no sales.”

In the political field, it was reported the Australian Labor Party are looking at using Blue State Digital tools to counter voter and member apathy.

Each one in it’s own way illustrates how organisations can be distracted by shiny new technology while ignoring much deeper problems.

In the case of David Jones, the department store ignored their core competencies and tried to ape their down market competitors in milking the financial services cow.

This worked fine while they could offer 24 and 36 month interest free deals and as soon as their partners American Express started charging a monthly “Administration Fee” that business evaporated.

One of DJ’s down market competitors is Harvey Norman, co-founder Gerry Harvey has spent his life building a fortune based upon providing cheap credit to consumers.

It was always going to be a mistake for DJs to compete with Harvey’s as Gerry is far better at the business than the well connected, genteel board of David Jones and their snappily dressed friends in the store’s executive suite.

Worse for DJs, the whole strategy alienated their core markets and while management focused on financial services customers went elsewhere to find the quality goods and services that the upmarket department store should be providing.

For both though, the financial services business model is now fading as the 20th Century debt supercycle comes to an end; consumers no longer want to load up on “buy now, pay later” schemes.

So all the talk of “omni-channel strategies” really doesn’t address the underlying weaknesses in both business.

This disconnect with reality is true in politics as well where the ALP is reported to be considering using the Red State Digital tools that Barak Obama used so well in his 2008 US Presidential campaign.

While the tools are impressive, they don’t address the problem that the electorate – and the member bases of the major political parties – have become rightly disillusioned and disconnected from the political processes that exclude everyone except an increasingly smaller circle of cronies and insiders.

The only good thing that will come of using US political communications tools in the spectacular eruption the first time one of the ALP’s factional warlords encounters a grass roots online campaign like The Great Schlep.

Heck, the resulting furore might even see some of the apparatchiks distracted from partying and whoring on their union credit cards for a day or two.

All the frivolity aside, the reality for the Australian Labor Party, David Jones and Harvey Norman is their problems are far deeper than a well designed website and impeccably executed social media strategy can fix. These organisations need major rethinks about how and why they exist.

It doesn’t matter how much money you throw at the web or how effective your social media strategy is – if the foundations of a business are shaky then a nice “omni-channel strategy” aren’t going to fix things.

For some of organisations, a failure to embrace the online world may be one of the causes for their problems, for many though there are far more basic issues they need to address.

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The death of local newspapers and media

How does the regional press survive in the digital era?

The bankruptcy of Lee Enterprises, publisher of 48 newspapers across the United States, is the  latest episode in the steady decline of local  printed media. Is the newspaper, particularly the local publication catering for a smaller market, dead?

Futurist Ross Dawson certainly thinks so, last year predicting US newspapers won’t exist as we know them by 2017 with them being replaced by digital platforms like the web, iPad and Kindle.

The problem for the media industry is how to fund news gathering in a digital environment. Newspapers are dying because advertisers have moved online, so Google now makes $30 billion a quarter on the income the local paper has lost in classifieds and display advertising.

For web surfers, this is also a problem as much of what appears on the net — in blogs, Facebook, on Twitter and circulated around message boards — comes from newspapers and largely subsidized by their rapidly eroding print revenues. Take out the traditional media, and many of the authoritative online sources disappear.

Much of the free web content we’re seeing is a transition effect as we evolve to paid online models, something that is going to be driven by advertisers following consumers’ eyeballs to the net.

For the publishers who don’t go broke in the meantime, this will probably save them in whatever form they evolve into.

Cutting costs to survive the current lean period is essential for newspapers, the tragedy is many are following other industries in cutting the very areas that give them their competitive advantage while keeping antiquated and expensive management who hang on to failed strategies.

Poor management is probably a bigger threat to the news empires, as it is for many other industries.

The damage done by poor business leadership is far greater than the cost of outsized management salary packages and entitlements. Until shareholders address the number, cost and suitability of the managers charged with running their investments, the future for these organisations is bleak .

Local journalism is going to change as we start seeing old media’s economies of scale being replaced by cheaper technology that allows local people to reclaim their news and community stories.

They will be doing this through blogs and social media while using their mobile phones and cheap cameras to capture and document local news.

For the local newspapers and media outlets who understand and harness their community, they’ll remain valued local commercial citizens; for those who see their readers as a mass of dumb consumers, they’ll be lucky to last the decade.

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Santa’s online business checklist

The run up to Christmas is a good time to make sure essential business information is online

Regardless of what sector your business is in, the web has become the way customers find us. Giving the key information shoppers are looking for is good start to getting their business.

An analysis by search engine giant Google of Australian consumers’ online Christmas shopping habits shows how the web is evolving as it becomes the main way customers discover businesses in the crowded marketplace.

Even if your business isn’t in retail, it’s worthwhile paying attention to the survey as a guide to what customers – both in the business to business (B2B) and business to consumer (B2C) spaces – expect online.

Do you list opening hours?

Number one failure of many sites is they don’t list opening hours or hide them. Warehouses, distributors and suppliers are particularly bad for this and if you’re in retail it is the unforgivable sin.

Your operating hours have to be clearly shown on the front page and come up early on a mobile site, people don’t want to navigate ten menus, subscribe to your newsletter or, worst of all, have to call you to find out if you’re open Sundays or in the evening.

List shut down and public holiday hours

If you’re in an industry that shuts down during the Christmas break, make it clear when you won’t be available.

Sending out a terse email message at 10am on the day of the close down and putting a sticky taped note on the front door that your accounts, receiving or sales department will be shut for two weeks doesn’t help your business or your customers.

Where are your contact details?

Probably the most bizarre aspect of hospitality industry websites is how many bars and restaurants hide their location.

This is fine if you’re one of these Melbourne laneway hipster haunts where only the ‘in-crowd’ are welcome, but most businesses actually want customers to find them.

Have your address and a map on your site showing exactly where you are. If you are in hospitality or retails have a mobile version that shows this first so lost shoppers and taxi drivers can find you.

Are local listings up to date?

A lot of mobile phone applications get their data from services like Google Places and True Local so get your listing up to date with these services, making sure you have accurate Christmas trading hours and that their maps accurately show your location.

The good news for hard pressed retailers is the overseas online threat fades in December as foreign websites can’t guarantee delivery after the first week of the month and local web outlets drop out around the 16th.

If you want to grab those last minute shoppers – which includes most men – then you’re going to have to make sure they can find you when they pick up their smartphone or log into their computer.

As Telstra have found, people are no longer turning to the phone directory and calling you for information, they expect contact details and opening hours to be clearly on your web site.

The web is where our businesses have to be, so make sure you can be found there.

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Is the social media business model dying?

Have the social media companies reached their peak?

Is the social media business model dead?

The frenzied rush to release new features such as Facebook’s latest changes, along with Google’s updates to their Plus platform, may be the first indication the big social media business model is broken.

Driving the adoption of social media services has been the value they add to people’s lives; MySpace was a great place to share interests like bands and music, Facebook’s is to hear what was happening with their families and friends, LinkedIn is for displaying our professional background and Twitter keeps track on what’s happening in the world.

Now the social media services want to be something else, Facebook wants to become “a platform for human storytelling” where you’ll share your story with friends and friends of friends (not to mention the friends of your mad cousin in Milwaukee) while Google+ wants to become an “identity service”.

The fundamental problem for social media services is their sky high valuations require them squeezing more information and value out of time poor users by adding the features on other platforms; so Facebook tries to become Twitter while Google+ desperately tries to ape Facebook and Quora.

Adopting other services’ features is not necessarily what the users want or need; you may be happy to follow a Reuters or New York Times journalist on Twitter for breaking news but you, and them, are probably not particularly keen on being Facebook friends or professionally associated on LinkedIn.

If it turns out we don’t want to share a timeline of our lives with the entire world but just know how our relatives or old school friends in another city are doing, then the underpinnings of the social media giants value may not be worth the billions of dollars we currently believe.

This isn’t to say social media services themselves aren’t going away, it could just be that the grandiose dreams of the online tycoons where they become an identity service or a mini-Internet are just a classic case of overreach.

For Google and Salesforce, whose core businesses aren’t in social media, this could be merely an expensive distraction, but for those businesses like Facebook it could be that Myspace’s failure was the indicator that making money out of people’s friendships isn’t quite the money maker some people think.

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