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44 posts from March 2007

Changing Revenue Model...#5: Outsourcing

MoneyFour down, two to go...  Here's a link to my original post summarizing the changing revenue model in publishing.  I spoke earlier about customer touch points, risks, margins and communities.  Item #5 was "do what you do best and outsource the rest."

It seems like obvious, common sense advice, but I think it's human nature to want to "do it all yourself."  The reality is, no matter how large or small your operation, there are some things you do well and others, not so well.  I would also argue that the more you outsource, the more nimble you can be.  If technologies change or new services are required for success, it's generally easier to switch providers (if necessary) than train/hire staff.

Sit down and make an honest inventory of your organization's key strengths.  What's your secret sauce?  What is it that your competition would have a hard time replicating?  I feel it's better to focus on those things and continue to refine them over time, making it harder and harder to replicate, than to worry about trying to do all the other things in-house.


Andrew Keen: You're Wrong!

ThumbsdownAndrew Keen of ZDNet is all over Tim O'Reilly in this post. First of all, I'm as outraged as everyone else about the situation Kathy Sierra is in; nobody should be subjected to that sort of harassment, let alone someone like Kathy, one of the nicest and smartest people on the planet.

Second, Tim O'Reilly is one of my competitors, so it would be very easy and convenient for me to pile on and try to say how Keen's argument is right.  O'Reilly is the one who has properly stated things in this case though, not Keen.

Tim O'Reilly is right to say that this is not a statement about the internet. If these losers weren't harassing Kathy online they'd undoubtedly find some other way of doing it.  Then Keen brings guns and the NRA into the argument.  For the record, I don't like guns and I'm certainly not a member of the NRA(!)...but...people do kill people, not guns!  If the gun wasn't there, murderers will (and do) find some other weapon.

I hate the idea of anonymous posts.  If someone feels like speaking out about an issue they should be willing to add their name to the discussion.  But Keen's suggestion that anonymous posts should become illegal is over the top.  Besides, does anyone really think something like this could stop someone from getting around the system and using someone else's identity?!  Banning anonymous posts isn't the solution.

I also don't understand why Keen focuses his argument so much on the blogosphere.  Where does he draw the line?  If the blogosphere went away tomorrow, wouldn't these same idiots post this sort of stuff on message boards, websites, etc.?  Do we need to shut down the whole internet?!

What is the solution?  Self-policing is touched on in Keen's post.  He pokes fun at O'Reilly for suggesting such a thing, but I think that's part of the answer.  The real solution though is just applying the same tactics that are used offline: Law enforcement needs to identify these losers and hold them accountable for the threats and other crimes they've committed.


Compendium Software: Local Blogging Venture

CompendiumHere's an interesting article in today's Indianapolis Star about a new local startup called Compendium Software that's focusing on corporate blogging and search engine marketing.  The co-founder, Chris Baggott, brings loads of e-mail marketing experience to the table from his last venture, ExactTarget.

Here's to hoping that more companies like Compendium, ExactTarget and MediaSauce continue to sprout up in the area -- maybe Indiana could become Silicon Valley 2.0!


Yahoo E-mail Storage Goes Unlimited

YahooYahoo recently announced they're doing away with e-mail storage limits in May.  I've had a Yahoo e-mail account for many years now but I more or less switched to Gmail when they offered more storage capacity for free.  My Yahoo account still exists, of course, but it's mostly filled with old stuff and incoming spam.

Over the last couple of days I've come to regret that move to Gmail as Google's service has been up and down since Tuesday morning.  It seems relatively stable right now but it was still choking when I initially logged in earlier today.

Maybe I'm in the minority on this, but increased storage space is no longer a compelling reason for me to switch services.  Heck, I'm only using 7% and 11% of Gmail's and Yahoo's space today, so why do I need a lot more?

Btw, if you're one of those people who use these services as a free backup utility, uploading all your photos and documents and feeling safe and secure, think twice!  I've had a few messages disappear from both services over the years and would never consider either to be a viable primary backup strategy.


Borders Loyalty Program

Borders_2When Borders made their most recent earnings announcement last week they also mentioned they're about to change their customer loyalty program.  This PW article summarizes the new policy.  I think they're heading in the right direction, but it's still not the best program for me.

After I spend $150 at Borders as a program member I'll get a voucher for $5 off a future purchase.  The smart part about this is that it's a way to drive follow-up traffic to the store.  What I don't like is that (a) it's not instant gratification like B&N's program and (b) it's about 3% off in total vs. B&N's minimum of 10% off.

That said, the Borders card is free and the B&N one costs $25/year.  So if you spend $300/year at either outlet you'll come out slightly ahead with the Borders program than the B&N one.  Double that to $600/year (which is at least what my family and I spend each year) and B&N has the advantage, but only by about $15, so it's not a huge difference.


Good Marketing vs. Great Marketing

GreaterThanks to Stacey Miller for pointing to this great marketing article by Dan Tudor.  It's an excellent example of how important it is to think about taking the task at hand to the next level.  In this case, Dan notes how a marketer took a different approach in solving a problem, the result of which generated far more revenue than the traditional approach.

I see two interesting points in Dan's article.  First, it shows how the development of e-content can and should be thought of differently than print content.  He takes advantage of the platform by incorporating links to the various author products, generating additional revenue in the process.  I'm much more likely to click on a live link in a PDF, for example, than I am to type in the full url that I just saw in a magazine, book, etc.  It's simply more convenient and I'm probably already online, so why not take advantage of this in an e-doc?

Secondly, and perhaps more importantly, when I stepped back for a moment I found myself thinking about how this applies to just about everything.  Seeing how someone else solves a problem often inspires me to think differently.  For better or worse, I bring a set of assumptions to the table they may not have.  I'm also guilty of accepting the status quo and not asking "why do we do it this way?" often enough.  How about you?


Changing Revenue Model...#4: Communities

MoneyAfter getting halfway through the list of 6 tactics I proposed in this post last week, we now move on to #4, the use of communities.  Everyone is talking about communities.  Whether it's building them, leveraging them or simply being part of them, they're definitely a hot topic these days.  Smart publishers will figure out how to incorporate them in their day-to-day operations.

If you're serious about a community initiative you need to read this post from Kathy Sierra.  She's got loads of community experience and provides a bunch of pointers that we can all learn from.

We've got a nice community of programmers that uses our "programmer to programmer" site on wrox.com.  We're fortunate in the sense that this community was built from scratch and yet it's extremely popular.  Building something today from scratch is more challenging because you're competing with a lot of popular sites that already get loads of traffic.  Can you build something from scratch today?  Absolutely, but why not first look to leverage communities that already exist?

If you're looking to build a community site focused on pet care, travel or any of a number of other consumer topics, are you likely to dislodge the current leaders in those categories?  Maybe, if you come up with a very compelling feature...  (Before you go too much further you really need to ask yourself if your "compelling feature" is really that compelling.  It might seem that way to you, but will the customer really think so?)

I have to credit Josh Hallett on this point.  He spoke at the recent ASIDIC conference and asked the question: "How many different community sites is a member likely to visit?"  IOW, if you are a pet lover and you're already going to one community site for all your needs, are you likely to go to any others?  Sure, it can happen, but it's probably rare.

So is it better to try and partner with an existing community site, especially if they're the clear leader in that space?  Think of all the eyeballs you'd have from day one.  Think of all the development costs and marketing expense you'd save along the way.  If those savings more than offsets the revenue you might have to share with that existing site, the answer to that last question might just be "yes."


A "Newbie" Ponders the Future of Publishing

Books2In this post by JA Konrath he thinks out loud about the future of book publishing.  One of his more interesting ideas is the notion of leveraging more of an advertising or sponsored revenue model.  In my keynote at ASIDIC I too talked a bit about how publishers need to consider this option.

When this subject comes up, a lot of people scream about the "editorial integrity" of a book vs. a magazine or the "need to avoid cluttering the book page with ads."  Isn't it funny how we're repulsed by the thought of an ad in a book but don't give it a second thought in a magazine or newspaper?  Why?  Because that's the way it's always been.  But what if the very first books to come off a printing press would have included ads?  And what if every book published since then would have included ads?  I'll bet we wouldn't give it another thought today.

Other objections to this have centered around the argument that big-name advertisers might be interested in appearing in a Stephen King novel but not one by some no-name author/publisher.  Maybe, but doesn't it all simply come down to the number of impressions?  Using the simple cpm model that's been around forever, yes, the Stephen King product would generate more impressions than the no-name work.  It might require a thousand (or more!) no-name projects to come close to the number of impressions that the King novel generates.  So that simply means the book that sells a million copies gets a thousand times the advertising income of a book that only sells a thousand copies; it still helps contribute to the income stream for the thousand-copy seller!

I definitely think advertising can and will play a more significant role in the book publishing world of the future.  In some cases it may even go so far as Konrath suggests, where content is hosted and managed by advertisers, meaning they control the distribution.


This Blog Has Been Nominated for a Litty Award!

AwardHow fun!  I got an e-mail message over the weekend letting me know that my blog has been nominated for a Litty Award by the Book Chronicle blog.  Regardless of whether I wind up winning one of the categories, I appreciate the fact that they've assembled a list of 35 blogs about publishing, many of which I hadn't heard about before.

I'll going to check them all out and add them to my RSS reader.  You might want to look through the list as well.


The New Rules of Marketing & PR, by David Meerman Scott

New_rulesI read and reviewed David Meerman Scott's earlier book, Cashing in with Content, last year and gave it a big "thumbs-up."  His next book, due for release in early June, is called The New Rules of Marketing and PR.  I recently finished reading a galley copy of this new book and my assessment is pretty simple: If you're a marketing or PR person, you need to read this book, period.

Chapter 15, "The Online Media Room: Your Front Door for Much More than the Media", is worth the price of the book all by itself.  Here's a great point from that chapter:

All kinds of people visit your online media room, not just journalists.

I'm a great example of this.  When I'm researching a company I'm unfamiliar with I often find myself digging around on their media pages to see what sort of information they're feeding real journalists.  I've found these sections to be a real treasure chest of insight, at least on some sites, and nothing but press release mumbo-jumbo on others.

Here are a few other noteworthy excerpts from this one, along with a couple of my own comments (in bold):

Great content brands an organization as a trusted resource and calls people to action -- to buy, subscribe, apply or donate.  And great content means that interested people return again and again.

Too often, corporate communications people at large companies distance themselves from what's going on in the real world of blogs, YouTube, and chat rooms.  But it's even worse when they try to control the messages in ways that the marketplace sees as inauthentic.

I think it's sad that so few PR people/departments seem to understand the value of blogs.  Far too many are still in denial and apparently figure it's just a fad that will go away soon.

The blogs that are best at reaching an organizational goal are not about companies or products but rather customers and their problems.

Amen!  How many corporate blogs have you come across that felt like nothing more than a half-hearted, self-serving attempt to join the discussion?

(When linking content directly to the "sales cycle" of choosing a college...)  The college must provide high school students with appropriate content so they get a sense of what college life would be like if they were to attend and what the admission process entails.

This reminds me of the story I talked about earlier where MediaSauce came up with a novel way of using technology to show prospective high school seniors what life is really like at Butler University, for example.  If a picture is worth a thousand words, a video is worth a million, especially if it's replacing something as static as a college brochure!

I recommend that, before you begin to write, you first monitor blogs in your market space and that you step into the blogosphere by commenting on a few blogs before you write your own.

This is one bit of advice I wish someone would have given me a couple of years ago!

Grant D. Griffiths, a Kansas family and divorce lawyer said, "I stopped doing Yellow Page ads last year.  In talking to other lawyers, I hear they are scared of not doing a Yellow Page ad because they are afraid that if they don't, then they won't get any more business."

I've heard similar concerns from small business business owners when I've mentioned blogging to them as well.  They're so hooked on the old way of promoting their business that they worry about losing a competitive edge by abandoning it.  All that does is leave the door wide open for their competitors to swoop in and own the relevant search phrases that will undoubtedly be used by more and more new customers going forward.