May 15th, 2006
I’ve always wanted to be able to say I was “live blogging” something, so here’s a live blog of the inaugural Mesh Conference, which I personally think was a smashing success. (There are linkable headings for each session I blogged.)
Here’s some wisdom from Om (with some paraphrasing, of course):
A lot of people in tradtional media should not be in the business. The market forces should just sweep them up.
Not all blogs are created equal, just like not all newspapers are created equal.
Blogging is a cheap way to create advertising inventory, with a lot less work and a lot more return on investment.
It will probably be bad newspapers that will disappear. I’ll be glad to see a lot of newspapers just go away. They’re just vehicles for online advertising.
Blogs are killing off the trade press.
Regular people don’t care about TiVo and appointment TV. If you have 6 kids and have to go to work at 6am, TV is the last thing on your mind.
A lot of people in the technology industry don’t pay attention to the reality of life. Too many startups don’t pay attention to how people use technology. Not all behaviors can be changed, and television is one them.
People make judgment calls, whether to believe you or whether you’re full of shit. But getting discovered is a huge challenge.
Most of the meme trackers cover the ‘A list.’ Old world thinking being brought into the new world.
Craigslist is a major hit in 4 or 5 major metro areas and that’s it. I get a catalog in my mail everyday, do I need a newspapers wrapped around. Advertisers are going direct to consumers.
Being completely opinionated takes away from what you write. When information is free, context is the value. People confuse my giving my opinion with my trying to give context.
Advertising is still 1.0 even though media is now 2.0. What we need is a new kind of advertising paradigm. CPM doesn’t make sense on blogs because you’re advertising to a community.
For newspapers, sports, lifestyle, and business news carry the economics, the rest is just a cost center. The concept of magazines is not going away
Internet Explorer Ã¢â‚¬â€œ 85% market share Ã¢â‚¬â€œ mainstream users donÃ¢â‚¬â„¢t know how to turn ads. You can download software to block ads, but people donÃ¢â‚¬â„¢t do it. People actually click on ads Ã¢â‚¬â€œ IÃ¢â‚¬â„¢m surprised at the number of people who click on my Google ads.
The blogs that provide value will stick around, and the rest will go away.
Every user comes with their finger poised on the back button, so you have to do great stuff. Reading blogs is about contextual reading. In blogs you can actually follow the thought process.
As someone who writes for a blog, I trust my audience to decide whether I’m good or bad.
People have so many choices, if people don’t identify with me, they won’t read me. I do my blog even though there’s hardly any money in it because I want to engage my audience.
Whenever I put an ad on my site I cringe wondering what my audience will think because for three and half years I ran my site with no ads.
We started using RSS, but we didn’t figure out how to monetize it.
It’s a huge business opportunity for anyone who can figure out a new advertising model.
Web 2.0 is a new way of thinking, not new technology.
On the other side of the newsprint are people, and the internet can help the newspaper connect with them.
Don’t read anything I write, just read the comments.
A lot of questions about business models, but few answers — Om put forth as much wisdom on business models as currently exists, but refreshingly did not pretend that there are easy or obvious answers.
Now some wisdom from Michael Geist:
Michael recounts the compelling story of how bloggers played a key role in bringing down MP Sam Bulte — with Michael firing the opening shot.
Interesting observation about trends in unique visitors of major business publication websites — which separates those who “get it” from those who don’t:
- 2002 – 2005
WSJ.com – 1.0M – 3.3M
FT.com – 1.3M – 1.8M
Fortune.com – 1.7M – 1.3M
Forbes.com – 1.7M – 7.8M
The tools and legal protections for locking down content don’t work.
The music industry realized that consumers are going to access their music and they could get paid for it or not.
Users already have control of content — the question is whether we’re going to put laws in place to lock them up for controlling the content.
Some of the copyright laws being contemplated are not about controlling content but about controlling markets.
Nigeria produces more movies a year than any other country, all for the home video market, sold on the street, and all without copyright law.
Google Print isn’t coming to Canada because they don’t think Canada’s copyright laws permit it.
There is real value in providing protections for intermediaries. We need policies to support experimentation and new models. The big label vision is about control.
Most musicians are happy to see there music out there because they’re going to make 90% of their money from ticket and merchandise sales.
No one knows what it’s going to look like 3, 5, 10 years from now. Government doesn’t need to get out of the way but to keep in mind the evolution of technology and the marketplace.
If you have economic incentives to limit Internet access and no laws in place to protect against such practices, then you’ve got a big problem.
A lot of people spend a lot of time for their blogs even though they know that nobody is reading because they like to write, and so policymakers need to realize that not all incentives are economic.
FreshBooks — online invoicing — clear app for a clear need
Pixpo — stream your videos — clear app for a clear need
AreYouFrank — creative-sounding, but not really sure what it is
Devshop — online project management app that can tell you when your project is about to be screwed up — but can it tell you whether the project is even worth doing?
, the consensus is that quality will continue to be the ultimate differentiator, and that the best video content will continue to rise to the top. From Amber, “everybody can do it, but not everybody can do it well.”
On business models, Rocketboom will be offering a $4 subscription model that allows you to view it without ads. Andrew is counting on a small conversion of a large audience to generate significant revenue.
There’s a lot of value in advertising to small, pure, targeted audiences — an extension of Google’s AdWords. The value of blogging is in promoting other businesses.
Traditional media won’t die, but print is most vulnerable, followed by commercial radio. Video the is hardest to do online well.
This was another panel with solid views on the trends in content and distribution, but not a lot of visibility on business models. It’s really foggy.
My panel with Om Malik, Michael Tippet, and Mathew Ingram on blogging and journalism was fun — I thought about live blogging it, but I figured that might be a bit rude. We had an interesting debate about the good and bad of user-generated content — a lot of garbage, but also a lot of opportunity to open up valuable sources of information. The real audience empowerment is that we vote with our attention and serve as collective editors.
Globeandmail.com: Slow process of getting people to change understanding of what daily newspaper means — first big step was adding breaking news, which changes the thinking of editorial. Control has to change. Allowing readers to comment is controversial because editorial staff questions whether comments are worthy. Readers are now gravitating towards stories that editorial staff aren’t focusing on — readers are voting with the mouse and changing the thinking of edit staff.
Torstar Digital: Not every individual in the organization is on board, but the organization is on board. Some are very wedded to the brand and the “seal of quality” of the Toronto Star. Created national freemium classified site to compete with Craigslist. May not be possible or desirable to change professional journalistic organization, but it is possible to create other entities that are native to the digital medium. You cannot monetize the news the same way online cause it’s an open system.
Yahoo: Focus on creating right infrastructure for users to create their own content. You can find content either through search/tag or through social network. Traditional media companies partner with Yahoo because Yahoo drives traffic. Aggregator or search service like Yahoo rewards quality content by driving traffic.
Paradigm shift away from package of information to the value of individual pieces — rather than bakers of bread, we’re becoming growers of wheat, and growers of wheat don’t pocket as much as bakers of bread. (Lot’s of torturing of bread metaphor followed.) Newspapers assets are journalists and audience — betting on value of journalists, readers, and brand.
Now it’s possible to see which stories are catching and what consumers are interested. Less about what the editor thinks is important and more about what readers think.
Risk: Pandering to lowest common denominator — example of Chilean newspaper that printed most-clicked stories as leads, and paid journalists more for those stories. Result was a lot of stories about swimsuit models, etc. But, too common for journalists to underestimate intelligence of readers.
Rating and tagging stories provides a whole new measure of engagement because circulation or clicks on individual stories.
Online Globe & Mail reader looks a lot like print reader, so online audience is reflecting the audience at large. But more tech savvy users are users are not even going to the newspaper.
Toronto Star — no value for anyone in registration — it was a lose/lose circumstance. Removed registration and traffic rose by 50 percent in 3 months. Web works better without barriers.
Globe & Mail — Content behind pay wall is positive from business perspective. But registration hasn’t proved to be a quick win.
Can the Times build the next Maureen Dowd with columnists behind the pay wall?
More opinion on everything than there has ever been before.
Angus Frame and Tormer Strolight have been refreshingly frank and forthright, much to the credit of their brands — it’s a tough job that they do.
Challenge with news is it provides no context for advertising. Online, advertisers don’t want to be in the news section because they want targeting — it’s no longer a mass medium.
One of strongest part of Toronto.com has been restaurants, so they created a vertical search of local restaurant reviews.
Globe & Mail more focused on being a niche player in Canadian media market and not in being a pure aggregator. Need to partner and link over to other sources. Too hard to be a better aggregator than Yahoo or Google. Need to give readers a menu of content, including a full suite links to content on other sites.
Edelman’s Trust survey showed for the first time that people trust their peers more than media, CEOs, sports celebrities, etc.
Companies need to get over the fear of community marketing — they need cases and proof points to convince them.
Letter T strategy — the top of the T is reach, which you do through advertising, PR, etc. The other piece of the T is a deep engagement with key parts of the audience.
Companies are starting to set up budgets for community marketing, e.g. Microsoft, Lego. Companies may be hesitant to spend money, but they may be convinced by other company’s successes.
There needs to be a move away from audience measures to link and conversation measures. Hard to make the case to the CEO for spending significant dollars on niche and narrow community marketing efforts — focus has always been on reach.
Edelman runs a “war room” for Walmart out of DC to identify pro- and anti-Walmart bloggers, and then engage those bloggers on a daily basis by sending an email and keeping them in the loop. Bloggers started cutting and pasting. We learned that we need to tell bloggers to attribute the information.
Wikipedia advice — look but don’t touch, like a Bengel tiger.
Whatever you do with social networks need to be done on the terms of the community, to approach the community in a way that is polite and acceptable.
Companies are buying up islands on Second Life where people can engage — but it’s only a small group of people.
Bloggers don’t need to develop new skills to deal with PR — they just need to be people.
Word of Mouth Marketing Association trying to create metrics — it’s like online advertising 10 years ago. Measure conversations, measure engagement. Try subsidizing programs with clients to develop successful cases.
Pay-for-play with bloggers could become prominent, but it’s not there yet, so it’s risky to do that now. Right now it’s unacceptable — three years from now, who knows.
Metrics: number of touch points, web traffic, inbound links — but it all comes back to sales — some work to do on the metrics there. Clients want metrics in a way that doesn’t exist yet.
Don’t do fake blogs and character blogs, e.g. Captain Morgan, because characters aren’t real people. Characters are all fake — great for ad campaigns, point of purchase, but not for blogging, because blogs are about authenticity. Not everyone agrees.
(Steve took a lot of flack over this from the audience — Jeremy Wright from B5 media — “If Darth Vader blogged, I’d read it every day.”)
“Higher interest” approach — need to elevate brand to larger subject, e.g. grape jam and nutrition.
Dollars will come out of traditional one-way advertising into two-way marketing.
In three years there will metrics, more case studies, failures to learn from, budgets for creating conversations, and indexes like the most talked about brands in the worlld.
1. Know where your customers hang out, what blogs they read.
2. Develop the infrastructure to listen to the conversations.
3. Engage the audience in the dialogue.
4. Empower the audience, help them achieve what they want to achieve.
Analyst firms are using blogs to build their reputation, e.g. Jupiter, Charlene Li at Forrester (who brought in $1M in new business through blogging.)
I talk, you listen works better with microsites. Blogging is for I talk, you talk.
The blogosphere is greatest fact checking machine that ever existed.
You can’t control the message, but you can guide it.
Need to experiment and generate data to get beyond mere opinion about what works.
Yesterday, the big uncertain was over business models — today, the big uncertainty is over metrics.
Feels like a reenactment of the last bubble, but so what?
**It takes a lot of dead bodies to fill a swamp.**
Web 2.0 is making the same mistakes faster, but that’s how you learn.
Seeing the same business model. The Flickr of XXX, or wrose, the YouTube of XXX.
At record levels of venture capital in terms of assets under management. In venture industry, it’s a rigged system — the best venture investors fish from a well-stocked pond. Rest of venture market fighting over scrapped.
Cash is falling on our heads — a lot of people with a lot of cash trying to find a home for it.
If you don’t need venture capital, don’t take it. If you can keep 100% of the equity, you’d be stupid not to do it. But a lot businesses need venture capital but don’t realize it, and they wait until it’s too late and have to take a raw deal.
Gave a presentation called “Get Your Head Out of the F—ing Tag Cloud.” With no barrier to entry, there’s 30 companies in every category — it’s like being pecked to death by ducks.
YouTube is a very early mock-up of what a future TV network might look like — but still not clear how they will get paid.
Google had no clue how they were going to make money — Kleiner and Sequoia were in a panic because there was no business model, and they ended up borrowing their model from Overture.
You can stumble into a business model, but you better have scale and a business that runs efficiently.
Google is starting to look like Amazon, where the rate of capital expenditure outpaces growth, which has dinged the stock.
Unsolicited business plans have gone from 99% b2c 1% b2b to 60/40 consumer/business in the last six months. Most interesting companies are all on business side, with subscriber models, but incorporating collaborative tools.
Dabble DB — most people use Excel as a really crappy database, because Access in is impossible. Dabble makes shareable databases easier.
Everyone thinks they have a seed financing gap. In Canada, there aren’t enough individual investors. Small venture funds can’t fill the gap either.
DFJ uses their funding announcement as a marketing program.
Venture funds are struggling over when to get in — not too early that it’s seed funding but not too late that they’re locked out by private equity.
Epidemic of features not products, i.e. it’s cool, so someone should pay for it. Plausible deniability — features are getting acquired, and Google is doing it.
Venture industry has changed because of the death of the IPO Ã¢â‚¬â€œ they need to play the acquisition game for the type of exit they need. But the acquisitions are one-offs, e.g. Amazon isn’t going to buy more Skypes and News Corp isn’t going to buy more MySpaces.
Preoccupation with AdSense Ã¢â‚¬â€œ absurdly risky, because only one customer Ã¢â‚¬â€œ Google. ItÃ¢â‚¬â„¢s a single payer system. (Squatters now called domain partners.)
We’re no back at the level of online advertising at the peak of last boom. $2 billion in additional ad dollars, but still just drop in the bucket of total ad spending for companies like P&G. J&J announced wouldnÃ¢â‚¬â„¢t participate in current upfront system. Coke said maybe they wonÃ¢â‚¬â„¢t play either. Beginning of cracking of dam, which will lead to larger flow of capital online.
Difference between media time spent online and ad spending online feels like an arbitrage opportunity.
Need deal flow to find right bets Ã¢â‚¬â€œ but CanadaÃ¢â‚¬â„¢s deal flow is much lower than in the US.
Not more risk taking in the value, but they see so many people being successful. Chicken and egg problem because there are not enough chickens or eggs.
Venture funds are getting creative with structuring deals because of the likely types of exits and what the companies need the money for, e.g. just marketing.
The problem in the consumer marketplace:
- Poor service
- Marketing lies
- Too many unsatisfactory choices
- Locked into choices (DRM, e.g. iTunes)
- Too many messages
A lot of debate about the Bowiechick theory of marketing. Was she paid to do it? Can it work for boring products, like cereal or jam? Is it better to have consumers vs. experts delivering the message?
Pinko marketing principles:
1. Inbound, rather than outbound messages
2. Be a community advocate (not a company evangelist)
3. 100% authenticity
4. Serve niche markets
5. Follow open source principles
Creating “viral” is not “authentic,” because it can be damaging to relationships.
If you haven’t seen it, check our the unofficial marketing of Snakes on a Plane.
There’s a danger when community becomes marketing, and we can’t tell the difference.
Beware of wisdom of crowds — they elected Bush.
The business models are worse because anyone with a credit card can start a business.
The consumer has changed. Consumers fee like they have a right to say something, and say it loud. Marketers can’t gloss over problems with products, because internet is screaming about what’s wrong.
Symbiotic relationship between agencies and media, which propose that
Not crap that a small group of creative people can build a business without mass media marketing.
When everyone has a blog, is that media? Everybody has a phone but we don’t call people one at a time to ask them to buy our product.
If all the money is going to paid search, how do you build a brand?
Marketing is coming closer to the product itself. It’s much easier to build a brand and a product together.
It’s all about creating a great experience, and you don’t deliver the experience, you’re dead. Marketing used to be about putting make-up on.
Brand is a cultural phenomenon that allows you to sell your product to more people for more money.
Experience with Apple will exceed expectations, so people will buy it.
Branding has always been about authenticity. What’s changed is the speed with which “bullshit” can be called on a brand. People will say you’re right or you’re wrong, and they’ll spread it like crazy.
What’s the value of the brand if all you care about is what other people think?
A brand is an election campaign that never ends.
Marketer’s responsibility to give a megaphone to people who love your brand.
It’s amazing the amount of information you can get from your customers just by asking.
Google built its brand be providing a better product, a better experience.
Should your blog have a business — if they come, they will build it.
A blog is just writing — did this happen when the pencil was invented?
The marketing is developing the product?
Huge opportunities to target customers who abandon the purchase (although there are privacy issues).
It’s all about the data.
Strongest brands are benevolent dictatorships — consumers do not want to do your work for you.