Polygraph Media Blog

Cinchcasting

One of my favorite new products is Cinch -- something that I think can only be described as "the Twitter of podcasting".

I use it to quickly record thoughts on what is going on in tech, social media, etc. and may very well turn it into something that I publish from my Twitter account daily.

I think there is a huge opportunity in sharing insightful thoughts that can be captured in 2-3 minutes.  For me, it is pretty low investment timewise -- lower than a blog post and it is certainly easier than setting up or even participating in an existing podcast.

I also think there is a big benefit for the listener.  Podcasts are a long & tough commitment for people to make unless they are on a plane, driving long distances, or exercising.  Otherwise, I think 2-3 minutes is ideal for listening to a well-reasoned thought or observation from someone you respect.

Will of course keep you updated as I become a regular Cinch user.

For now, I invite you to check out my page at http://www.cinchcast.com/ctreada.

Forbes article on local business marketing going social

Howdy everyone - today Forbes published a summary of my thoughts on local business marketing. Paraphrasing, I really do believe that local businesses are being forced to develop a core competency in internet marketing across major channels -- e-mail, social media, search, etc.

The full article can be found here:  http://www.forbes.com/2010/09/17/facebook-small-business-technology-marketing.html

Companies that get it are killing it, and those that don't will suffer.

Have a great day everyone.

Hal Varian on newspaper economics

Interesting blog post from Hal Varian, Google's Chief Economist, on newspaper economics.

http://googlepublicpolicy.blogspot.com/2010/03/newspaper-economics-online-and-offline.html

Hal points out a few things that I 100% agree with:

• special interest local advertising was the bell cow for the newspaper business,
• people consume news and information on social nets, mobile devices, etc. more and more today,
• experimentation is key to helping newspapers survive and thrive in the 21st Century.

Google has been demonized by folks in the newspaper business for making audiences mobile and destroying newspaper brand loyalty.  While this has in fact happened, I don't know that it's fair to blame Google. These are trends that were bound to be realized with Internet technology.

Now Mr. Varian is certainly not a "disinterested" party.  But he does make good points here.  Newspapers must continue to push the envelope and experiment with new models.  It's a cultural problem that must be overcome -- and it's tougher in some local media companies than others.

How Consulting Helps our Startup, and vice versa

Had we launched a startup and a consulting business at the same time in 2006 or 2007, we may have taken a lot more criticism than we did.  But even in the middle of 2008 -- before the stock market crashed and many people realized that the salad days were over -- I heard a lot of good things about the model.  The "capital efficient" startup model was just starting to take hold and most people thought that we could effectively balance the needs of both businesses.  I mean, it's better than starving right?

It has worked a little better than I originally expected.  Here are a few points about our experience that we've learned over the last 18 months or so:

• Focus is great and perfect for an ideal situation where you are adequately funded and you know exactly what you're building.  Kudos to folks who have that luxury.
• Focus, however, may work against you if your team members need a dynamic work environment.  Our team works best in bursts of 2-3 weeks at a time.  If we worked on one thing all the time, we would be less productive.  I have seen us work hard on something for say a month at a time, and we tend to slow down towards the end.  We get stuck on things that we can't quite solve.  Variety helps us.
• So we aim to have a few software projects and a few consulting arrangements both at the same time.  It turns our startup into a cross-disciplinary group that takes lessons from one project and applies them to the others.  It's helpful far more often than you'd think -- and as a result, we have both better products and we provide better services to clients on the consulting side.

At some point in the not terribly distant future, we will have to focus our energy more directly.  The two businesses will likely divorce one another as the stakes get higher with world-class customers and possibly investors.  But I don't think I'd start a company any other way if I had to do it all over again.  Focus is great if you can afford it, but the serenditpity you get from doing a few things well pays off tremendously.

The SXSW PanelPicker Social Media Scrum

If you pay close attention to what is happening in Web 2.0 and social media, odds are you've been hit up for a ton of requests to vote for a panel on SXSW.  The folks at SXSW are taking votes into consideration for 30% of the criteria for selecting panels.

I am not entirely sure how I feel about this.  On one hand, you want sessions run by credible people from industry.  Votes on interesting planels are one way to help make that determination.  From the organizer's perspective, it works because SXSW wants to create as much buzz as it can about their upcoming show.

On the other hand, over 2,200 panels are listed.  This is far too many for people to scan and make intelligent choices.  Further, a subset of information about each panel is listed -- in many cases you don't have all the information you need to make an intelligent choice.

What it appears to have evolved into is an all-out scrum for people to promote their sessions as best they can.  For a lot of folks, the most efficient way to do this is via Twitter, hence the noise.

I don't know what the answer is, but I do think that there is a real risk that sessions at SXSW will be more of the same echo chamber that you hear if you follow the Twitterati.  Hopefully SXSW can have the same eclectic mix it has always had with perspectives from people we may not have heard from.

Don't confuse me for a social media zealot

I have had a few conversations with colleagues, ex-colleagues, and current clients that lead me to believe that they think I'm a social media zealot.  While a lot of what I do is tied in some way to social networks, I find it necessary to set the record straight tonight.  Here's what I believe:

• Social media is old technology, but mainstream adoption of it is a new phenomenon.  Nobody knows for sure if it is the next wave of computing or a fad.
• I *think* that Facebook has a few big advantages that make it the leading contender for social media dominance.
• But it is entirely feasible that the great advancement of the social networking age is not social networking, but rather the mainstream adoption of real-time data/information.
• Should things move in this direction, Twitter is undeniably in the lead here as they truly own (shaky as it is) the infrastructure for this along with a fairly large user base.  But it's too early to tell whether or not they'll actually win because switching costs are relatively low and Twitter is probably still a little too buggy to be considered "reliable infrastructure".
• I would not be shocked at all to see a major player (Microsoft, Google, Amazon, Yahoo!) launch and have some success with a Twitter-like product.
• The combination of blogging, micro-blogging, and social media have created a truly democratized platform that allows anyone to be a publisher.  This has been discussed ad nauseum by people in technology and observers.  However, changes to consumer behavior as a result of these things have made the dissemination of information far easier for "trusted" sources.  Very few things actually need to be printed anymore now that the infrastructure has caught up to consumer behavior.  Or is it the other way around?

Perhaps most importantly, all of this means that Internet Marketing has gotten a lot more complicated.  At one time, you just had to rank high on search engines.  Then the opportunity came about to buy space at the top of search engines.  Now to be totally effective, you have to do both of those *plus* make strategic decisions & execute on social media, Facebook, Twitter, employee blogging, and "real-time" customer service.

We don't have new social media opportunities today, but we do have new internet marketing opportunities.  Social media opens up bi-directional communication with previously anonymous customers.  It's an evolutionary, not revolutionary, change that requires you to think more holistically than ever before.

Another thing on the Yahoo-Microsoft Bing search deal

Think of this one from the internet marketer's perspective.  Just a few years ago, internet marketers exclusively focus on Google to conduct just about any internet advertising campaign.  Then Facebook emerged.  You could still ignore Microsoft and Yahoo because the two systems were different, difficult to master, and only offered an incremental gain in audience.  With the new partnership, you'll just have to log into AdCenter to run ads across both the Yahoo & Microsoft networks.  With 30%+ market share right out of the gate, it's easy to justify now. 

Google AdWords is a mature auction model whose prices may have been artificially high because of the lack of competition.  Now internet marketers have three viable options:  Google, Facebook, "Binghoo".  Two are much cheaper than the third, and both also now have a big enough audience to matter.  And I am making no assumptions yet about Twitter, which could become a 4th viable internet marketing option in coming years.

Overall, I expect margin contraction for Google.  Price/demand will gradually drop as internet marketers investigate and begin to use other viable opportunities.  This has been coming for awhile, but it's here now.  Google officially needs a new trick and fast.

The Surprising Market Reaction to the Microsoft-Yahoo Search Deal

Disclosure:  I don't own shares in Microsoft or Yahoo (yet).

Maybe I'm missing something, but I really think the Microsoft-Yahoo search deal makes a ton of sense for both companies.  I was very surprised to see Yahoo's stock take a huge hit in the days following the deal.  Maybe it's a case of "buy the rumor, sell the news".

As a result of the deal, Yahoo gets out of the "search technology" business altogether.  This is a cost center that was a losing battle for Yahoo in my opinion -- going up against Google and Microsoft is and always will be a losing proposition for most large companies.  Besides, it isn't Yahoo's primary business.  Today, Yahoo is in the business of operating a large network of web sites with tons of users.  And although they run the risk of becoming the "next-generation AOL", that isn't necessarily a bad place to be.  There is a lot of money to be made in the long-tail of Internet users who don't use the latest, greatest Web sites and services.  The most interesting part is that Yahoo retains 88% of revenue by partnering with Microsoft on search technology.  As Ballmer said last week (paraphrasing), Yahoo stays in the search business and retains 88% of revenue with no COGS and no R&D.  Not bad for Yahoo at all IMO.

Microsoft gets several things out of the deal.  They learn by getting a ten year license to Yahoo's search technology.  They also all but kill Yahoo as a search technology competitor... ten years from now, search will have evolved significantly I'm sure.  Old, unmanned technology is pretty much useless.  Bing gets adopted by a much larger customer base -- so Microsoft is effectively buying market share.  Finally, Yahoo will serve as the worldwide marketing and sales force for Microsoft AdCenter and the combined search advertising offering.  This is an area that Yahoo really knows well, certainly better than Microsoft.

Overall, I like the deal for both companies because each get to focus on their core strengths.  There are certainly some efficiencies gained from the deal that both sides will enjoy as well -- you have to figure there is cost savings coming for both companies now that they are working together.  As with any partnership, the key is going to be in the details of how two self-interested companies manage to work together not when executives deal, but when middle-management makes decisions in real customer scenarios.  And can the two companies act quickly to capture emergent opportunity.  If it is relatively clean, I think this will be better than "two dogs getting together".  It will be a significant change to the landscape of internet marketing.

Quick Hits: Thoughts on Free/Freemium

There has been a lot of chatter recently in the blogosphere around free business models following the release of Chris Anderson's book and Malcolm Gladwell's subsequent review.  I thought I'd chime in with a few comments from the early stage entrepreneur perspective.  I don't have a lot of time today, so you're getting bullets and not the well written prose you are accustomed to getting from me ;-)

• "Free" is indeed the most frictionless way to get attention.
• This concept should not be equated with "the easiest way to build a business" -- the two are not necessarily the same.
• "Free" should also not be confused with "inexpensive to operate" -- Free at scale means that all of a sudden things can get very expensive.
• Despite all the obvious benefits of "Free", it's also a good way to never get your customers to pay you directly.  It's harder than people think to flip the switch from "Free" to "Paid", which is why you see so few examples in the marketplace of that actually succeeding.
• Companies without a way to directly monetize customers die unless they have a realistic way to generate revenue indirectly.  Google figured this out, Facebook is now figuring it out, and Twitter is well on the way as well.  Twitter may very well end up offering "Freemium" services, but they'll likely never freeze out a consumer who refuses to pay.
• This, obviously, is the key to Freemium -- making sure you deliver enough of a Free service that people who don't want to pay stick around while delivering a differentiated Freemium service that enough people actually want to justify the effort.  This is tricky.
• Companies that rely on a "Free" business model are to some extent relying upon either M&A or clever monetization tricks/schemes to succeed from a business perspective.  So if you're investing or working for a company that is relying upon this, you really should watch for indications that the management team is on to something and/or that they are listening.
• "Free" is ridiculously chic right now.  Most Web 2.0 type businesses are depending on some clever monetization scheme to succeed.  Very few will actually achieve profitability on this strategy because it's *damn hard* to create an indirect & defensible scheme for making money.  For one, it takes scale -- enough Users that indirect monetization actually works.  On the business operations side, the best candidates for success are those businesses that obsess over their cost structure *and* have an inexpensive way to scale.
• My final point -- but I'm pretty confident that all the indirect schemes will play out over the next few years.  We'll have a few winners and *a lot* of losers.  And when we do, people in our business will start asking the question "why not just charge people to use this?"... and "Paid" will be the new black.

Maybe we're ahead of the curve.  Maybe we just "don't get it".  And maybe we're not as cool as the "Free" crowd.  But I have a handle on what our services cost to operate.  I know how many customers get us to profitability.  Most importantly, I know roughly how I'm going to monetize them -- and it isn't based on hypotheticals or schemes.  Call me old school, but I prefer this approach to the hopes and dreams I've believed in before.  What can I say?  It feels like 1999 all over again, just without all the free cash flying around.

Why we can't all get along on Twitter and what to do about it

Maybe I'm slow, maybe I don't think about these things in an academic sense, I don't know... but it recently occurred to me why Twitter sometimes annoys me.

1) it's every man/woman/bot for him/her/itself,

2) everyone has a different use of Twitter, be it personal, business, or rapidly generating a following,

3) everyone has a different perspective on what the rules are or what they should be,

4) everyone has a loudspeaker.  As @cheeky_geeky so eloquently puts it, Twitter isn't as much a conversational platform as it is a tool for one-way communication.  The only difference is that in real-life, you can occasionally opt to ignore even folks you ordinarily like to hear.

Let's face it.  Statistically, it has to be pretty hard for someone to use Twitter and not be turned off by something they see or someone they follow.

It might be the guy who follows everyone.  It may be the woman who refuses to follow you back when you "do her the favor" of following her.  It may be the shameless self-promoter.  It may be the person who won't stop promoting their business venture that is getting no traction at all.  It may be someone who airs dirty laundry.  It may be a serial flip-flopper... the ass-kisser... the shameless groupie that comments on every semi-insightful point made by "the Twitterati".  It may be someone who annoys you with their political views, which are clearly so important and impactful that they need to be shared with thousands of followers.  I could go on.

The lack of a shared ethos re: Twitter usage is quickly becoming a problem for the Industry's latest darling.

Think about other communication media for a moment.  We've developed accepted practices around e-mail.  We know to be careful with SMS because the recipient is charged a fee for received messages.  Facebook and LinkedIn are largely governed by how their platforms operate... i.e. both people in a "friendship" or "connection" have to accept the other.

In Twitter, the only rule is that everyone can follow anyone... which means that we all approach Twitter with different intentions.  It also means that over time, you can gain less and less insight from data Twitter currently provides.  For instance, at one time early in Twitter's life, you would gauge a User's popularity and/or importance in a community based on the # of followers he/she had.  Now it may just be an indication that someone is a Twitter whore.  ;-)  OK - maybe that is harsh.  It could be an indication that someone is trying to build a following perhaps for business development purposes, and doesn't discriminate when taking on new followers.  My point is that the correlation between followers and a User's reputation is certainly not what it used to be, and it is continuing to trend negatively.

So what does all of this mean?  If Twitter is to continue to thrive, Users will need a way to filter noise and both consume and contribute to the broader community.  Twitter is a pretty good way to follow a few hundred people, but can someone reasonably follow significantly more people?  Not at present.  It doesn't have to be fully conversational in my mind, but it does have to be occasionally conversational.  If it isn't, it won't survive as a means for everyone to hold a loudspeaker and shout things into a deserted forest.

It also means that we all need more insight into the people we choose to follow.  We don't necessarily have enough data to make informed decisions today, so we'll continue to waste time evaluating what we see and what we read.  I'm not sure that is going to last too long.  Maybe I'm wrong.

If you and/or your brand does want to be listened to in Twitter, it's more important than ever to establish a good reputation.  Provide useful content in as human a manner as possible.  Be consistent.  Commit to sharing unique or curated content on a regular cadence that your users can expect.  Rise above and don't annoy.  Set the rules of engagement and you will win, but do so as a trusted, valuable member of the community.