Monday, 30 May 2011
Being able to be connected to everything you’re interested in, anytime you want has definitely changed the way we consume media and information. Because we’re not bound to wait for the morning paper or the hourly news update from TV, but have the option to access information anytime that suits us, has resulted in new ways of accessing information.
Apps, Search, RSS readers, social media, news aggregator sites and of course traditional news sites, all provide us with different ways to access and consume information. Let’s go over the four main ways.
1. Going directly to the news site of my choice
This is the classical model of consuming news and the philosophy behind any newspaper. I choose the media site I trust, click my way to the front page and study the content the editors have chosen for me.
This model depends on my trust in the brand and old media habits. But it also limits how many sources I can follow. In the past you had no choice. You subscribed to one or two newspapers and watched a couple of television channels. Editors may be dreaming that I am happy only with their site for all my needs, but it just isn’t so.
2. Aggregation of news from many sources
The web has given us practically unlimited number of choices. But there is no way I can visit every site I might be interested in every day. So I use aggregation sites, which automatically pick up news from numerous different sources, either selected by me or by the aggregator.
Aggregation offers users the choice to follow many more news sources than before, scanning through their headlines and quickly deciding whether they want to go to the actual source. This is a major benefit if you are following news from a particular niche. Yet the amount of stories quickly becomes too much. The biggest challenge is what to do with the stories you did not have the time to scan through.
Search has become so convenient and normal these days that we don’t even think about it as “search”. Search is very good when you look for specific information – but does not work as well when you just want to follow the latest news. There are some great opportunities with tailored search alerts, for instance if you are following the news about one particular company.
4. Peer-edited news stream
Social communities like Twitter and Facebook as well as bookmark sites like Digg, Reddit and Delicious let users recommend news content to their peers. Instead of depending on the sources of the news, the users leave their trust with who is recommending the content. Basically this means that your peers take the role as editors.
Personally I have found myself increasingly depended on the people I follow on Twitter and Facebook. I have chosen these people either because I know them or because they have a professional position, which is interesting to me. These people provide an increasing number of the news stories I have the time to consume during the day, especially in the niche areas of my interest.
And guess what? They are so much quicker than the professional journalists! Breaking stories happens so much faster in Facebook and Twitter because the distribution is crowdsourced to the users and because people spend most of their time using them anyway. It only makes sense that they should be the main medium of accessing and consuming information in the upcoming years.
My media consumption diet
Posting this just to make a little reference for future, to see how my media consumption will change.
Media that I Buy
- Music via iTunes downloads
- Random magazines for airline travel (Men’s Health, National Geographic, The Economist)
Media that I Consume
- Radio/Music- YouTube
- Newspapers (Helsingin Sanomat, Huffington Post, Google News, Google Reader
- Television shows
- RSS feeds (Indianapolis Colts, Carolina Panthers, DePauw University News, BusinessWeek)
Media Consumption Categorization:
B2C: Specialist and Generalist
- Digital Buzz blog
- Social Media Today
Saturday, 28 May 2011
When you hear the words social media, what companies come to mind? Coca cola? Skittles? Ben & Jerry's? If so, it's not a surprise. These companies have been well publicized for their use of Facebook and Twitter to create innovative campaigns. But other companies are using social medias too. Even "boring" companies!
- Facebook- LinkedIn
The following best practice analysis is of Intuit inc. (an American software company) that develops financial and tax preparation software and related services for small businesses, accountants and individuals. The company is a great example of how any company (not just the obvious, fun ones, like Skittles or Ben & Jerry’s) can utilize social medias and communities in their business models.
The online presence of the company is quite impressive, especially considering the field of work Intuit’s in. Their online activities cover everything form blogging, crowdsourcing, YouTube channels, social networks to aTaxAlmanac, which is a free tax research resource modeled after Wikipedia.
Intuit’s online presence covers the following:
- TurboTax team blog (General topics about to taxation and accounting)
- Bob Meighan’s blog (Vice President of Intuit, company and industry topics)
- Intuit Labs (Site for product testing and customer feedback)
- Numerous employee accounts to answer product questions
- Intuit QuickBooks – channel (Guides about the product)
- TurboTax – channel (General news and help for individuals)
Ratings and Reviews
- TurboTax reviews (reviews of their personal and business software’s)
- TurboTax Support Community (targeted for individuals)
- QuickBooks Community (targeted for businesses)
- JumpUp Community (targeted for small businesses and start-ups)
- TaxAlmanac (“Wikipedia” of taxation and accounting)
SWOT analysis of Intuit’s use of social medias
Intuit’s greatest strength is in its massive number of communities. Just one of their communities has more to offer than many other companies’ entire online presence.
Besides the official company blog (TurboTax team blog), which covers topics from industry specific topics to topics relevant to individuals, and the blog written by the Vice President Bob Meighan’s blog, each community has a blog of their own. Each community also has an expert locator map, calendar of upcoming Intuit and other relevant events, forums, podcasts, videocasts, webinars, whitepapers and user generated content. The communities are built around the different Intuit products, which have their own specific user segments. Having all this information and content made available for each product makes sense, since there is little risk of cannibalizing their own communities.
Example of just one of Intuit’s communities is JumpUp, which is a free social networking and resource site for small businesses and start-ups. The site offers numerous free tools and services, like an interactive business planner, different cost and profit calculators, free templates and sample business plans.
Intuit is also involving their customers into the development of new software and applications. On Intuit Labs.com Intuit’s development teams share their ideas and products with users to have them tested and to get feedback from them. All this is freely available for customers and the featured applications cover everything from small businesses apps, to apps related to personal finance and various mobile devices.
Finally, as a testament to their commitment to providing people with all the possible information they might need related to finance and taxation, in 2005 intuit launched the TaxAlmanac. The site is modeled after Wikipedia and is written by US tax professionals and combines legislative information with practical examples and case studies.
Weaknesses and threats
Intuit’s massive online presence can also be seen as a weakness. The massive amount of personnel and operating costs required to maintain this kind of system can easily cripple a company if circumstances were to change. Because Intuit has established itself as the number one software company for personal finance, accounting and tax return software in the US and has created these huge communities around each of its products, consumers will expect the same for every new product they will launch. Every product will have to have its own site, with its own designated experts and content, which means ever-higher operating expenses.
Even if Intuit eventually does discontinue old products, people will still be using them and will not take it lightly if Intuit will also close the communities of these products. So the choice is between saving operating costs or pissing of and possibly alienating their customers.
Intuit’s inability to expand to other geographical markets is also a weakness. In most of Europe and around the world, taxation is far more simple and automated than in the US. Average citizens in these countries don’t need the type of software Intuit offers and that means that the market the company is competing in is limited mostly to the US. Spending in online marketing is the highest in the US market and if Intuit wishes to stay as the market leader in their field, they need to invest significantly time, resources and money to marketing and research.
Even though the company is somewhat limited to the US market for now, they could still expand to other geographical markets with their small business and start-up software’s. Providing European markets for example with information on the international legislation related to finance and taxation, with software optimized for the European and UK accounting standards could be a way to enter the market.
ConclusionIntuit’s online presence is a combination of high-level professionalism, mixed with a dash of fun and lightheartedness, which can be seen on their Facebook page and on their TurboTax – channel. Intuit has invested heavily on building communities around each of their products. Each of these niche communities has a very active level of engagement by the company’s specialists and the users. The company has understood that just by providing people and companies with software to help with their taxation and accounting problems isn’t enough, the support by Intuit has to be top quality and can’t be limited to just product support but has to encompass the entire process of accounting and taxation. By making all this information and content free, re-enforces the company’s image as a reliable source of information, and the customer engagement through the several communities, social networks and crowdsourcing guarantees high-level
Monday, 23 May 2011
There are almost as many variations of the different pricing models as there are companies on the web. Everyone is trying to figure out what’s the best model out there in order to maximize either conversion, traffic or whatever they’re trying to do. In my previous post “To charge or not to charge, that is the question” I explained my take on pricing of online content and what I see as almost a paradigm shift in how consumer will consume information and entertainment. Since we haven’t yet entered through the golden gates to Shangri La, where content is freely available to everyone, I will now cover different pricing models suited for modern publishers and content producers.
To begin with what I won’t be covering here is the infamous pay wall model. My personal view is that, even though it might work for highly specialized publishers with their own niche audiences, it won’t work for 99% of the companies out there. Not at least as a single source of revenue. If the pay wall payment can be bundled together with for example my cell phone and cable bill or if I have the option to specifically choose what I want to pay for, then there is a change it could work. What the Finnish newspaper Helsingin Sanomat does very well is that they’ve enabled the customers to choose exactly what they want to pay for. In addition to receiving the traditional paper newspaper, customers can choose to add the iPad and mobile versions of the magazine to the order. They can also choose on which days they wish to receive all this. So for instance for a busy future business man like me, the iPad and mobile versions of the magazine might be enough from Monday to Thursday but I could still have the paper magazine on Friday, Saturday and Sunday when I have time to read.
During a time when publishers are becoming service providers and service providers are more and more becoming publishers, the differentiation into black and white is difficult and so is finding the best possible pricing model. Different ways publishers can approach this problem is by experimenting. If revenue from advertising isn’t enough, they shouldn’t isolate themselves from the web behind a pay wall, but they should develop new sources of revenue. Adding different services that meet the needs of different niche markets into an existing business model is one way to go. Examples of this can be found from the Daily Mirror’s MirrorFootball.co.uk, which provides highly detailed information about football in the UK and around the world. The page takes the sport’s section on the Daily Mirror site further by offering users more content and a change to bet on games. Until the industry standards and clearer game rules are established, the best bet for successful pricing should be a mix of little bit of everything.
Sunday, 22 May 2011
Okey, so we’ve all seen the struggle the newspaper industry has been facing over the last decade and a half, which is how to make money in the digital world. Compared to traditional paper magazines, the pricing of digital content isn’t as clear cut as deducting the cost of printing added with the salaries of the journalists and operating cost of the magazine, divided over the number of magazines sold. Of course even the old model isn’t as simple as this, but the different components affecting the price you pay at the newsstand for your morning paper are more evident and more easily discoverable.
When it comes to digital content the old approach doesn’t really make much sense in a modern world. There’s not much incentive for me to pay for news on one site if I can get the exact same news for free on another site. Faced with this problem the publishing industry decided to go with either of two different ways, free access to content supported with advertising revenue or pay walls around the content. Arguments for and against both business models have their supporters and so far no clear victor has risen. Where pay walls might make sense for some publishers, for example highly specialized financial magazines, they don’t make much sense as a standalone payment option for general newspapers. It’s not that I can’t spare the few pounds a week it would cost to get access to the news behind a pay wall, but it’s more on the lines being fallaciously wrong. At this day and age, at the time of free information, it’s just simply put wrong.
I’m not saying that publishers shouldn’t get paid and be able to make profit, but the way they do it should be revised. Holding on the old believes of what and how people should be charged for content has changed. In an interview by ORGZine, author Neil Gaiman talks about the beneficial effects he discovered piratism of his books had on their sales. Initially irritated with the unlawful publishing of his books for free online, he later discovered that it actually worked for him, especially in markets where he was still unknown. Sales of his books took of after they were illegally translated and distributed online. This discovery encouraged him to offer his latest book, a book that was still selling well, free for one month on his web page. After the experiment ended they discovered a 300% increase in sales of his books in total. It was then that he realized that he wasn’t loosing money because of piracy, but that people were actually sharing the books amongst their friends who were then buying his other books and recommending them to their friends. When asking audiences of how they discovered their favorite author, a rough 90% of them said by lending a book from their friend. In his opinion he isn’t loosing sales, he is advertising. He’s reaching more people and raising awareness. “Nobody who would’ve bought your book is not buying it because they can find it for free. “
So here is one example where embracing the freely distributed content model works. Will it work for you or a large publisher like the New York Times, that I don’t know. Nobody knows. There is no one clear solution out there. What might work for one company could be out of the question for another. The problems that the newspaper and music industry are facing now, might be a problem that the movie industry will be facing soon. Of course piracy is already an issue for them but the direction things are headed towards might force them to search for new ways of making money. The same way as the newspaper industry is seen as going either really cheap or really expensive, might be happening in the movie industry by the end of the decade. Just like the news industry and journalism aren’t going anywhere, neither is the desire for entertainment. Only the medium of distributing and pricing it is.
Saturday, 21 May 2011
So, how important is innovation these days to a company anyway? Can you survive just by actively copying what competitors are doing successfully or should you try to "strike gold" on your own?
Well, innovation used to achieve market dominance is as important as it has ever been. The problems with innovative products and software are that they’re not available to people in a way that sells. Mp3 players existed before iPods but it was Apple that made the product user-friendly with the product itself and with the iTunes store. Same thing happened with touch-screens, which weren’t so successful until Apple’s launch of the iPhone. To come up with a “kick-ass” technology or software isn’t enough (Friendster à Facebook), the finished product has to be presented and made available in a way that is easy and desirable to the consumers.
Companies are changing their approach to innovation by involving the consumers and experts outside the company more and more in the process. They need to understand what the real needs and changes in the market are going to be, in order to respond to these needs. When Apple was faced with thousands of jailbroken iPhones they opened up their system by releasing the Apple software development kit (SDK) This has allowed thousands of professionals programmers and amateurs to come up with their own apps in order tostrike it rich with this modern day gold rush.
Innovative new ways to develop products and start up businesses have become possible with the use of crowdsourcing and crowd funding. Already back in the early 90s Linus Torvalds, (one of the main developers of Linux OS) utilized the help of hundreds software developers and programmers to come up with the first open source operating system in the world. Crowd funding, even though still at a quite moderate level, has enabled small companies to develop their products and bands to fund their operations.
Advertising online has been made more efficient and targeted with the help of different tracking programs utilizing cookies and more sophisticated tracking methods like the one offered by Cognitive Match. Another innovation in online marketing is product placement in videos, which has been in development for several years without much success. Now Impossible Software has come up with software that allows inserting still images or videos into videos (http://tcrn.ch/fwVNbL). The idea isn’t new but the level of technology has taken a huge leap forwards and the final product looks like a seamless entity. Combining product placement with video advertising, and finally with the tracking data of the individual user to allow personalized advertising, won’t revolutionize the digital marketing industry but could be a big thing soon.
Customer service taking place in the magical world of the Internet takes many forms and shapes. Anything from FAQs, discussion forums, live chats with the company representatives and utilising social medias like Twitter, Facebook and LinkedIn are being used in different ways. Best-practise guides and blogs more professional than this one all emphasise the importance of customer engagement and listening what they have to say.This all sounds nice but how is it done in practice? How have some the best in the industry manage to sort this out? In this first posting on customer service I examine how Marks and Spencers is doing it on their Facebook page and what the whole "My Starbucks Idea" website is all about.
M&S Facebook page:
Facebook Wall postings should be abut two-way communication and not just posting sales offers by the company. At M&S the staff is answering people’s questions about different M&S services and product availability as well as their features. They’re also providing tips related to different occasions like St. Patrick’s Day, Valentine’s Day and Pancake day, which are naturally more or less related to M&S products but still useful tips.
The newsletter provides a condensed, one page view of the latest offers, new products and tips / offers related to special occasions (Pancake day).
The M&S Discussion board has a very active presence by the M&S social media staff that are actively participating in the discussions and offering advice to consumers, who have had problems with deliveries and with different M&S products. The staff comes across in a very neutral way. They’re not advocating for M&S but have almost a role of a mediator between consumers and M&S. In one discussion they even advised a person to look for a dinner set from their competitors as M&S had discontinued the sales of the product.
They’re also continuing to convey this idea of “helping out people” with their Prostate Cancer Awareness Month boxers, that were designed by famous designers to increase awareness of the issue with proceeds going towards cancer research. It provides consumers with useful information, opportunity to help out and increase the positive brand image of M&S.
My Starbucks Idea:
This site takes the customer discussion about Starbucks away from Starbuck's homepage and Facebook page, and gives fans of Starbucks a platform meant specifically to gather all their ideas and suggestions. It's the ultimate step in gathering feedback by a company and can by no means succeed without a large and active fan base.
The site gives consumers the opportunity to submit their own ideas about Starbucks products and ways they could improve their service. Customers have the opportunity to share their idea with other users, have them vote on the ideas and finally see the ideas in action once Starbucks has implemented them. The site has become a total customer feedback driver for the company with active users posting new ideas and discussing the company on the site, providing Starbucks with invaluable feedback. The site has also a leaderboard scoring users based on the number of ideas, comments and votes submitted. This is to further incentivize the users to actively comment and participate on the site.
Starbucks has managed to create a “small” online community dedicated to improve pretty much everything Starbucks does. They're utilizing the active follower group they have without giving them anything more than credit for the ideas they come up with. Despite only getting a “virtual handshake” for their ideas the site has a very active community with new ideas being submitted round the clock. The latest ideas are displayed on the front page with some of the ideas actually implemented just below them. The site is a great example of utilizing consumer power and willingness to participate.
My Starbucks Idea takes eCRM to the next step of engagement and activity. The site isn’t trying to seem like a compromise between products and ways people can use them (like M&S Facebook page), but its just a site purely for improving Starbucks. The site is simple and provides an easy medium for people to engage with the company. Even though this might be hard to replicate by other companies, it still shows something to strive for.
In conjunction with my previous post on promoting trust (http://ollilainto.blogspot.com/2011/05/promoting-trust-online.html), I've taken the analysis a bit further and dwelled into how the previous companies I've analysed, manage in cross-selling. I've also added a few new examples of what I see as good and bad examples. Cross-selling items and services is vital for many companies in order to maximize sales and since the customer is already planning on buying something from you, why not offer them highly relevant and "necessary" items / services to bundle together with the original purchase. Let's see some recent examples of the do's and dont's of cross-selling.
In-application cross-selling is a great way for companies to get people to buy add-ons to their games and software that can be even used on several apps.
It also makes it easy for to the companies to promote their other games and software.
Zynga is an example of company that not only uses in-app promotions but also allows users to get exclusive in-game items for cross-app use in games like Farmville, Cityville and Mafia Wars.
Godzilab's "StarDunk" is a free game but users can get in-app upgrades and game items if they download other Godzilab apps.
Tapulous’ TapTap Revenge series has just adopted the freemium model and the in-app promotions offer additional song packs and the company’s other games.
What is good about these examples is that the prices of the cross-sold items are close to the initial purchase price and they are highly related to the user (Appendix 1).
RyanAir has pretty much perfected their website’s purchase funnel with cross-selling items and services. After choosing the your flight dates you get to the passenger details page (Appendix 2) which offers a myriad of additional things the passenger can purchase. Passengers have to pay extra for pretty much everything that is normally included in the price of a ticket by other airlines. These include priority boarding, travel insurance, SMS confirmation, RyanAir approved cabin bag, special equipment, special assistance and method of payment. After booking the flight, the customer is bombarded with hotel and car rental options. These advertisements are specific to the location and date you’re flying so they’re highly relevant. The pricing of the different items and services is also quite low so the hurdle to add them to your purchase isn’t too high.
H&M’s new website received a lot of criticism after its launch last September and for good reason. What is even more appalling is the cross-selling used by the company. I browsed the website for a while, going through only men’s clothes. I browsed through all the men’s categories and paid special attention to Jackets & Blazers. After choosing a blazer for purchase and proceeding to checkout the site offers me women’s tops and a dress! This is just ridiculously poor. The site even says “Something for you!” but there’s nothing in my browsing history to indicate any interest in women’s clothes (honestly). I guess it’s good that the items offered are significantly cheaper than what I was planning to purchase but they could not be less relevant and interesting to me. And I sure am not going to risk buying stuff like this to my girlfriend. It’s clear there’s not much optimization and tracking going on on the H&M website. What they should cross-sell to me? Nice shoes, pants, shirts or ties for men (Appendix 3).
And the Ugly:
Expedia.co.uk is trying to take advantage of cross-selling in their trip booking funnel by offering people the opportunity to purchase a travel insurance with their holiday. The relevancy is there and the price isn’t too bad either. The execution however is horrible. The whole site too “busy” and displays too much information whatever the customer is doing. With the travel insurance example they just make the purchasing of it look difficult unpleasant. What they should do is first of all redesign the whole site but if that’s not possible, then at least they should take out most of the information related to the travel insurance part. I would approach it like it was the thing I was actually selling. They should have few key bullet points visible and if customers decide to purchase the insurance, then they would receive all this information in the form of a popup window or something like this.
This week I'm looking into how different companies are promoting trust on their websites in order to assure potential customers to spend their hard-earned money online. This analysis compares 3 different companies to give you an idea of what to do, and what not to do.
This menswear site gives instant perception of credibility with “real world aspects” and tremendous ease of use. The site demonstrates its expertise with the company blog covering various topics related to the site, clothing and dressing up in general. Trustworthiness is build through pictures of the people who blog and are responsible for the site. On the bottom the shopper can see easily all the accepted methods of payment. Even though shoppers can’t “Like” or tweet about specific items, they can join the Bridge55 Facebook site and follow them on Twitter. The site also let’s you see the items you’ve previously viewed adding to the “tailored user experience”.
The ease of use is done through clear product categories separated to clothes by categories in one bar and clothes by brands in another one. The site has a professional feel and looks, and it’s not over selling items to shoppers. On the other hand it’s not utilizing cross-selling, which could be implemented on the site in a tasteful way.
The launch of the new H&M website last fall has become a great example of what not do. The key issue to pleasant shopping experience is clear navigation, which H&M doesn’t have. The categorization of clothes is fairly adequately done but it has categories like “DIVIDED” in the top horizontal bar and L.O.G.G in the vertical bar which don’t mean much to a person who is not fairly knowledgeable of fashion or H&M.
- The site doesn’t have breadcrumbs to help users track theirs steps back.
- The site doesn’t have search to help people to find exactly what they’re looking for quickly.
- Doesn’t scale to appropriate screen size (fills roughly 1/4th of my 23inch widescreen dispplay)
The site doesn’t offer any means of sharing through social medias. “Likening” clothes or tweeting about shoes would go a long way in making the shopping experience more sociable.
What is even more appalling is the cross-selling used by the company. I browsed the website for a while, going through only men’s clothes. I browsed through all the men’s categories and paid special attention to Jackets & Blazers. After choosing a blazer for purchase and proceeding to checkout the site offers me women’s tops and a dress, with a slogan “Something for you!”
Points for relatively clean design, which might deceive people into believing the site is credible.
(I could probably write a dissertation on the mistakes, problems and issues I have with this site)
Ryan Air (http://www.ryanair.com/en
When it comes to website design, I think a 13 year old could do a better job in designing a website for an airline. The sit looks messy, it’s confusing to navigate and the different tabs don’t make sense or are overlapping each other. The initial credibility feeling from this site is probably as low as it can get, and I think that’s all a carefully planned strategy by RyanAir.
The colors, the layout and the display ads all give an idea of a cheap website and I think all gives users’ subconscious a perception of “this airline has be the cheapest choice”. The whole “Lidl” look of the site combined with cheap and anesthetic display ads is meant to, in my opinion, to convince people of the cheapness of Ryan Air and built credibility of that competitive advantage.
RyanAir has also pretty much perfected their website’s purchase funnel with cross-selling items and services. From the main page to having chosen your flight dates you get to the passenger details page, which offers a myriad of additional things the passenger, can purchase. Passengers have to pay extra for pretty much everything that is normally included in the price of a ticket by other airlines. The pricing of the different items and services is also quite low so the hurdle to add them to your basket isn’t too high.