Tag: revenue

  • For a few dollars more…

    This won’t be the first time I’ve written about Twitter’s revenue model, and I suspect it won’t be the last. In fact, the last time I wrote about it, it was in the context of the deal that almost happened between Facebook and Twitter. Its been a couple of months, so I thought its a good time to check what both have been upto on the subject of revenues.

    There was a scare recently on how Facebook is going to make money by selling users’ data, but that turned out just to be misinterpreted statements, based on a demo that they did at Davos to show real time crowd insights, and had nothing to do with the Engagement Advertising model. Facebook has been growing very fast, (stats) and though this is claimed to be a demo, real time insights (permission based) from the exact target audience could indeed add a lot of value to brands, and any other entity that could be interested in data. Market research firms should actually be working with Facebook and starting to develop pools specific to their client’s audiences. With Facebook implementing the Friendfeed style ‘Like’ feature, the tools are becoming as simple as possible.

    Meanwhile, I also wonder about the data that could come from the sites that have been tied through Facebook Connect, especially since there are some big names in their respective fields. This could reveal a lot more about the individual’s interests – basis his interaction with the other sites, and that data would be easier to handle since in many cases the site’s content would dictate the context, unlike the generic data that could be picked up on Facebook itself. This would be an interesting space to watch, and that’s an understatement.

    A simple yet possibly history making story of how Twitter was made. And in another simple yet profound statement, Seth Godin described it as a protocol. And yet another good one which describes it as a social experiment. Which then raises the question of how a revenue model can be made for this protocol or experiment. As someone once said, “Twitter is what you make it to be”. There are pains too. Twitter’s humble origins and the scale envisioned may not have made a vision mandatory then, and there is also talk that Twitter could ‘go for years’ without earning, but to survive in the long term, Twitter does need a vision, one that’d then give some direction for its revenue model.

    There have been many entities trying to use the stream for transmitting ads, adCause and TwitterHawk, being the latest, but honestly, it does seem like a force fit. But I’ll admit that the location+context based approach of TwitterHawk does seem very interesting. In fact, there have been many apps built around Twitter, some of which require the user to give the Twitter password to use the service, and there have been security problems thanks to that too. Hopefully that’ll get sorted out once OAuth is implemented, perhaps we’ll see a new generation of mashups too, leading Twitter towards a revenue model. Here are some very interesting thoughts on Twitter, including searching conversations based on category, and a marketplace around conversations and real products. Its interesting to note that brands have already begun experimenting with Twitter, and with tangible expectations, as the recent Dell promo of exclusive deals shows.  More likely to follow that model with the launch of TwtQpon. In this context, check out CheapTweet too. Meanwhile, here’s a good set of thoughts for Twitter revenue.

    Twitter Contest-Denuology Entry94 Update

     

    With enterprise versions (Yammer)and even college versions (Wiggio), Twitter needs to hurry, if it does not want to lose out segments altogether. This story about Twitter thinking about charging brands is turning out to be true. I can imagine those social media evangelists within organisations groaning already!! But all the best, and we await the Business Product Manager. 🙂

    While Twitter scores on the real time aspect (my opinion since I use both) Facebook offers a lot more easily available data on an individual’s demographics, interests etc. The other parameter is that while Facebook is being adopted by the masses easily, Twitter does require a bit of getting used to. Facebook might have to sweat a bit to crack real time, and Twitter would have to do many things – consider scaling up groups to other regions, have better ways of segregating conversations and data mining.  But in the end, it all does seem to boil down to using real time information of potential/existing consumers, with precise demographics and interests based targeting.

    We keep saying that social media and its tools are all about the human touch, and the personalisation. And brands utilising these platforms should understand that. I wonder if the same applies to revenue models too, and whether this extreme customisation will mean that both these networks will find it difficult to conceptualise and then implement, revenue templates, that will fit all.

    until next time, money makes the social world go around 😐

  • @ the friends within followers

    Sometime back, I’d written about micro ambassadors, where I’d also touched upon the long tail of twitter influence that is made up by individual users, and marketing opportunities therein. I read a few posts recently that made me think on the subject a bit more.

    Some of the posts referred to a research paper on Twitter, by HP, which reveals that

    the driver of usage is a sparse and hidden network of connections underlying the “declared” set of friends and followers.

    A few numbers on the respondents (from the study) – 309740 users (this sample is 6% of the twitter universe, info courtesy Jeremiah’s post, the comments on the post are also very interesting), who on an average posted 255 posts, had 85 followers, and followed 80 other users. Among the 309740 users, only 211024 posted at least twice. The average @ replies ( conversations between 2 or more users, specifically mentioned in the tweets) were 25.4% .

    A few findings I thought were interesting. The number of posts increases with the number of followers but saturates after a certain point. However, this saturation does not occur if we consider the number of ‘friends’ (followers with whom a user has had 2 or more @ conversations). The study also shows that on a number of ‘friends’ vs number of followers chart, the number of friends saturate after a certain number of followers is crossed. Understandable, since in a day, one can only have so many conversations with so many friends. My twitter statistics (though not the same as the average user in the study) corroborate these friends and usage findings more or less. It is thus debatable whether there’s any sense in just increasing the follower count. A certain Guy definitely wouldn’t agree, and it does finally depend on the intent. 🙂

    It also questions the follower-influence- WOM marketing model, and its scalability. I’m actually quite happy with this since I have never been comfortable with this line of marketing strategy on a trust based network. While its not scalable generally, there are exceptions – Guy’s Alltop is one easy example.  The relationship he has with his ‘followers’ obviously doesn’t fit into the followers-friends definition discussed earlier.

    The echoing powers of RT (re tweeting) is another thing to be kept in mind. If I follow someone, and i find some content interesting/informative, there is a good chance I’ll RT that, even if I do not have regular conversations with that person.

    Lastly, this equation might change if Twitter implements groups. Even though its limited to Japan now, there is a good chance that the rest of the world could get it soon. Meanwhile, you can always use Twittgroups. Groups would allow consolidation of crowds interested in certain things. Marketing would definitely be easier then.

    And finally, to wrap up, the favourite twitter pastime- revenue models. If such marketing is not a scalable option, and will not excite brands to use twitter a lot, what will? I read two very good posts on the subject of revenues. RWW has a post on the search of Twitter being used as a revenue tool, since it gives live results from all of Twitter, and doesn’t wait for any indexing like Google does. In fact, the idea of companies using Twitter as an early alarm signal is something I have come across before. Nick Bilton has an interesting idea on Twitter throwing up the kind of immediately relevant ads we would like to see with “some really intelligent data mining and cross pollination”. I quite like that idea too. 🙂

    until next time, tweet and ye shall find 🙂

  • News..yes. Papers?

    Rupert Murdoch recently stated that the doomsayers predicting the end of the newspaper industry are off the mark. According to him, online readers also need news form a source that they can trust, and that’s what newspapers have always been doing. He agreed though, that newspapers would have to change from the ‘one size fits all’ approach to cater to readers’ demands. He mentioned his plans for WSJ, to offer three tiers of online content: free news, a subscriber-level service, and a third “premium service” of reader-customizable “high-end financial news and analysis.”

    The newspaper, or a very close electronic cousin, will always be around. It may not be thrown on your front doorstep the way it is today.

    On the whole, I tend to agree with him. However, I also feel that newspapers would be missing the point,  if they see this as just a change of platform. Its a mindset change, not just in terms of news delivery, but also in the way they approach business. After all, even the biggest names, like NYT , Gannett (publisher of USA Today) , are not in the pink of financial health.

    Before we get to that, a few varied ‘heritage media’ (print) trends. On one hand, we have publications like Christian Science Monitor and PC Magazine and many others switching to a primarily online only presence. On the other hand, the NYT opened up a couple of APIs, releases an AIR based news reader, the Guardian buys PaidContent, and offers full text RSS feeds, the Financial Times’ new site design resembles a blog, and some magazines are even rolling out Instant Messaging functionality. Over to India, Live Mint and Business Standard have recently launched podcasting (via WATBlog), India Today added Cosmopolitan to their existing list of digital properties and Business Standard has launched a branded Instant Messenger – BS Buddy (via Medianama). In essence, newspapers and magazines seem to be looking a bit more seriously at making the transformation from real to virtual.

    So this is a good question to ask – what’s the next step for news? To start with, they could take a good look at this list of 10 things that every Newspaper/Magazine site must do. This itself would be completely against a few things that they’d consider sacred – most notably, link sharing and responding to comments. Broadly, I’d imagine it to be a two pronged approach

    • figure out how to deliver their content on digital platforms, and that might even lead to changes in the kind of content they gather, and the way they gather it.
    • figure out a business model that can leverage the content they have – subscription/ advertising/ both.

    First the content aspect. A lot of publications have been experimenting with citizen journalism. They’d do well to check out tools like CoverItLive. Instead of randomly adding a ‘blog’ section to the website, make it work. Get enthusiastic journalists to blog. Get regular bloggers to do guest columns on specific topics of their interest. Promote them and the content they add to the site. This would help them being aggregators who also serve niche interest communities. What is equally important is to bring about a systemic approach to making journalists regard their story as just a start, and getting them to take ownership of making it a conversation. There are advantages in it for them – new story ideas as well as a better understanding of their readers. Yes, Twitter can help in the conversations too. These changes in news gathering techniques might very well change the quantity and quality of newsroom staff. This makes a great case study.

    The business aspect. I read a a very insightful article on how the entry of print publications into the digital medium will change the balance of power and wealth in the link economy. This process has already started. But before that, I think they have to see themselves as news sources, rather than just the newspaper on the web. This would influence how and where they position their ads, and would help them deliver better value to advertisers, as well as readers. While on this subject, I think online ad networks that include newspapers (with various editions and publications) along with independent blog/ blog networks that complement/add on to their content, might make sense. I remember NYT making a sort of conglomerate in association with 3 other newspapers, sometime back. There are other business models too. For example, there are community funded reporting services like Spot.us. (via RWW) Do check out this link for a very radical approach.

    Though readership of dailies (with very few exceptions) continue to drop, I don’t think newspapers are in their death throes in India. But should they wait for that? A good brand takes some time to build. There’s a reason why more people in India visit Rediff and Yahoo and even the web 18 properties than Indiatimes/ Times of India group properties. I’m hoping to see something like Instablogs join the big league soon. Brand loyalty in the real world need not translate into brand loyalty in the virtual world, especially when you’re dealing with a (by now) commodity called news. And as newspapers would know from their real experiences, once readers are used to a certain way of consuming content, it’s difficult for a competitor to sneak in. It would pay well to learn from mistakes – of those aborad who might have waited too long to transform. After all, what doesn’t kill you doesn’t necessarily have to make you stronger. And I’m not sure if newspapers would like to be part of the thin end of the long tail of news consumption, with pure play web entities occupying the head.

    until next time, save paper, save the environment 🙂

  • Twitt…er, pay?

    Would you pay for Twitter?’, a very good question, asked by Walt Ribeiro, at his blog. It made me think, and I came to the conclusion that I’d pay (though it all depends on the price). Apparently, I’m in a majority. There’s possibly no ‘pain’ that Twitter is addressing in my case, unless I count the need for every human being to communicate. But I can do that on Facebook, and if its streaming conversation I want, there’s friendfeed, or Kwippy. But yes, twitter has a charm of its own, especially when you start with so many interesting people who share different interests of yours.

    The revenue model for Twitter is something that has caught the imagination of a whole load of people, since everyone, I think, is keen to prevent an ad based model. (yes, including me). The Twitter CEO also agrees. And in a lesser way, there have been discussions on the revenue models of Facebook and Friendfeed as well. A good read on this here. Meanwhile, I read an excellent article, which had a P&G digital guru stating that marketers don’t belong to Facebook. In his own words,

    “What in heaven’s name made you think you could monetize the real estate in which somebody is breaking up with their girlfriend?”…. … We hijack their own conversations, their own thoughts and feelings, and try to monetize it.”

    A superb perspective, I thought. He goes on to wonder who said this (user generated media in general) was media, since all consumers were doing were trying to talk to each other. Its a wonderful line of thought, and when I think about it, I’d have to agree with him. But it makes me wonder about the nice folk who built Twitter and Facebook and Friendfeed. While they are nice people, I doubt if they had such massive charity in mind. They build the infrastructure, they bear the costs, I’m happy using it…for free. I go into a coffee shop, and pay money for the coffee, that’s the basic service, I never wonder if they work on a freemium model. I watch a movie in a theatre, pay money for it, and only grumble when they show ads. I suffer both kinds of monetisation, and still go back. But when the Fail whale happens, i rant, and threaten not to go back. Thankfully, I do go back.  I wonder if there’s something wrong with this scenario.

    So, monetising FB, Friendfeed, Twitter – why is it such a difficult thing? Is it because there’s no tangible value in them? But there must be, considering that millions use them everyday. In fact, I read a post yesterday that shows an example of tangible value created by Twitter. But then, the moment there’s a payment mechanism or an ad model discussed, there’s usually a user revolt. I still remember the extreme reactions to magpie.

    A very long time back, someone thought of leveraging the audience that uses content, that became the fundamental way of running media businesses. Newspaper, television, radio businessses have not been built on content, they have been built on monetising the audience that uses the content. Then, a long time back, the web came into being, and someone started a price war that started at zero. So we had free content, free mail, free IM and we were generally happy. Over a period of time, some learnt to monetise, and Google learnt it so well (hell, without content!!), that it built a Google economy, which I agree, might be an inevitable future. But while the ‘customers get everything for free and advertisers pay for Ad Sense’ model is great for Google, I wonder if it’s fair to demand the same of other services that subsidise our conversations with each other.

    Every UGC driven medium – Flickr, You Tube, Twitter, Facebook etc needs to find its own way of leveraging the audience. Template solutions might be a thing of the past.  Like I replied  to a comment on an earlier post of mine, I know quite a few twitter clients, while i know only one for FB. Facebook ‘s services compels users to visit the site, Twitter’s simplicity doesn’t. Every service is different. Ads are obviously not the greatest of solutions though both Facebook, and You Tube are increasingly going along that path. (Here’s an excellent read on Facebook monetisation) Twitter should find its own way of leveraging the audience its gaining daily. I personally thought the research based model that has been started by SocialToo is worth a shot, as one source of revenue. LinkedIn is already doing it. I also saw Twitpay today, and think there’s potential in it.

    Meanwhile, I feel quite like a hypocrite when i consider services like Twitter Image, which is based on Twitter and charges $100 for a customised Twitter background, while Twitter doesn’t have a business model as far as we can see. I desperately want Twitter to crack their model soon, after all with 2500 plus tweets, there’s a lot of me in Twitter. If Twitter dies, a part of me dies too.

    until next time, a sharing caring world, reluctant to share costs?

  • Apperception- LinkedIn

    Apperception – The process whereby perceived qualities of an object are related to past experience.

    Last week, I’d written about some developments in the business networking/enterprise web2.0 space. To make the scenario even more interesting, LinkedIn announced the launch of its applications platform. 9 apps have been launched so far, and they are presentations from Slideshare, and Google Presentations, a reading list app from Amazon, online workspaces from Huddle, a travel networking app from TripIt, blog feeds from WordPress and Blog Link (from Six Apart, powered by Typepad), a file storage, collaboration app from Box.net, and one home production called Company Buzz, to track the twitter talk on your company, trends etc. Going forward, all apps will be screened by LinkedIn to ensure that they are of ‘professional’ nature, and users can add a max of 15 apps on their homepage, this is to prevent clutter. (via Tech Crunch)

    While the app ideas seem cool, I was extremely disappointed with the loading time (I tried WordPress and the Blog Link apps). The WP app also does not work with self hosted blogs, so i was advised by @prateekdayal to try the Blog Links app, but its taking forever to load!! I was thinking of a few apps that LinkedIn could consider – a del.icio.us app which would help me share links with those LinkedIn friends who don’t use the bookmark sharing service, an app from upcoming.org that i could use to share events, even a flickr/youtube app to share pics and videos from conferences, events etc (while hoping that I don’t get to see birthday party pics and videos). Oh, okay , a career daily astrology forecast too 😉 No, it stops there, we really can’t have the ‘Which Office character are you’ app.

    Meanwhile, the apps will have to use LinkedIn’s ad network, so that ensures control on monetising. I also read recently that LinkedIn has another revenue stream which is in trials now – B2B research surveys. The professional crowd is a great sample for market research, and can be targeted according to expertise/audience preferences too. To ensure that users aren’t pissed off, survey solicitations will be limited to one/member/month. Gift cards, opportunity to view survey results, charitable donations and even monetary rewards are being used as participation carrots.Interestingly, Facebook is also one of the networks which has been used to create a system of virtual currency payment in return for participation in online surveys.

    Interesting, because LinkedIn has been profitable since 2006, Facebook still looks at ads as its main revenue stream, and Facebook, for all its popularity hopes it will have a  business model in 3 years. Facebook has MySpace and some would say even orkut competing for the users’ attention, in a generic space, Twitter and Friendfeed, too, but in its space, LinkedIn enjoys a huge, loyal user base. It makes me wonder, if at some point of time – considering the economic scenario and the jitteriness of investors, Facebook will look at alternatives, and provide filters for users to create ‘separate’ profiles for separate audiences (work/friends, for starters). If that happens, and Fb can do the app magic (in the work space) that enahanced its popularity, then LinkedIn might feel the heat!!

    On the flip side, I also wonder if LinkedIn should reflect a bit on fading work-life borders, and how personal and professional interests are learning to co-exist in an individual’s mind without being shoved into separate compartments. This could play a huge role in deciding LinkedIn’s role in a user’s mindspace. I personally feel that because of a very formal approach that LinkedIn seems to have adopted, it doesn’t share the relationship that Facebook enjoys with me. My time on LinkedIn is limited to adding/accepting contacts, and tweaking my profile once in a while. That’s far behind the quantity and quality of time spend and interactions on Facebook. Its not just about the apps, Orkut has them too,  too little, too late and didn’t make any difference to me, its about the overall experience. I am not saying that they should add ‘Superpoke’, but when organisations are becoming more liberal in their outlook and encouraging employees to be personalities , rather than robots, LInkedIn might do well to consider a tweak in its positioning. Perhaps it’s just a design/interface thing, or its a deeper perception about what LinkedIn stands for, but the current image, to me, is neither social nor fun, and that may not be a good thing in the long run. Here’s a good post that talks about infusing some fun into LinkedIn.

    I think its fair to say that just like it has in reality, in virtuality too, personal and professional lives will overlap, whether they co-exist or compete, only time will tell.

    until next time, will LinkedIn be semi formal on fridays? 😉