Tag: Reality Check

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Another Social Economy

Why Our Widgets Whip Click-Through, or, Pay Per Click Ads

CPM: Cost per thousand impressions
CPC: Cost per click-through
CPA: cost-per-action
Conversion Rate: The percentage of visitors who take a desired action
Customer Acquisition Cost: The cost associated with acquiring a new customer

— Internet Marketing Dictionary

Complex Formulas
What it feels like trying to figure out Search Engine Marketing.

Searching for  Search Engine Marketing

I recently signed up for Google AdWords and started playing around with its campaign site. After twenty, or, thirty minutes, I started getting a splitting headache and through frustration, closed my Google Chrome browser and defiantly opened up Firefox.  Now to be fair, I had no business signing up for AdWords, since I can’t even spell S-E-M (SEM) but, I was determined to get a better understanding of what I could be missing.  Being a start-up and desperate for bootstrapping sales, it seemed only logical to investigate.

Google Sales to the Rescue, sort of

The very next day I received a call from a Google Sales Rep – Terry Dewey, who was incredibly helpful, and patient, in walking me through the site & giving me my very own S-E-M 101 Course. But, by the end of the call, there was one thing terribly obvious to both of us. If I couldn’t manage to spend $7500 a month on AdWords advertising, then there simply wasn’t any point in getting started.

WCT: Wholly Crap Through

At $7500 a month, with an average of 3% conversion rate, my customer acquisition cost was probably going to cost me more than I was going to make.

Reality Check and The Referral Engine Bibles

So needless to say, I’ve abandoned my jump into SEM and have returned to the teachings of Guy Kawasaki’s Reality Check & John Jantsch’s The Referral Engine. If I understand correctly, the key to success is sharing with those who can help. So that’s the motivation behind the :AnotherSocialEconomy Reseller and Referrer programs. Another lesson learned, is that I have to make it real easy for those folks to pass the message along and that’s why we developed the :Widget and the :Bookmarklet.

The Ultimate Cost Per Action (CPA)

CPA offers are the truest form of performance marketing. Rather than basing payouts on bulk traffic which may or may not convert, cost per action refers to compensating affiliates/publishers for real sales, leads, and other conversion metrics. This is often the most empowering method for advertisers, as they are able to gain direct results from their advertising budget. The CPA model is a risk-free approach to advertising that usually targets niche specific publishers or clever affiliates.

— Peter Hamilton

According to Rubicon Consulting & Online Communities and Their Impact on Business: Ignore at Your Peril, where they found 10% of the community members contribute 80% of the content. These Most Frequent Contributors (MFCs) are second to word of mouth when it comes to influencing others.

So for starters, here’s how our Widgets whip click-through and pay-per-click advertising for Influencers (MFCs).

  1. Prep work:
    1. Become an AnotherSocialEconomy Reseller
    2. Post an AnotherSocialEconomy Widget on your blog, or, web site. The widget can be customized to your site’s look and feel so it doesn’t distract your readers.
    3. Contact Retailers, suppliers, manufactuers, brands, distributors, and anyone else in position to close a sale – locally, or, online and have them register as AnotherSocialEconomy Retailers.
  2. Blog, review, rate, do whatever you do to contribute valuable content.
    1. Your readers can then fill in your site’s Widget to purchase whichever goods and/or services mentioned.
    2. AnotherSocialEconomy will then notify all registered Retailers within range of the Consumer’s location and ask them if they have the goods/services available for sale.
    3. Those Retailers with inventory on hand, then propose their goods to the Consumer via AnotherSocialEconomy.
    4. Once Consumers confirm, they can then proceed to the local Retailer and pick up their goods.

Bottom line

AnotherSocialEconomy is about connecting serious buyers with local retailers. So only those Consumers interested in buying, will click-through.  And only those Retailers in a position to close the sale, need to reply. There’s no conversion rates, or, customer acquisition costs to worry about. Retailers only pay when they close the sale.

But wait, there’s more …

And what about that kind Influencer? Since they Referred the request via their site’s Wdiget, they get to share in some of AnotherSocialEconomy’s proceeds.  And in this particular scenario, since they- as  a Reseller signed up the Retailer who made the sale, then they again, get to share in some of AnotherSocialEconomy’s proceeds. Now that’s some CPA, eh?

Thanks

I’d like to thank Michel Drouin for connecting the dots between click-through advertising and the value proposition of :AnotherSocialEconomy’s :Widget.

Stay tuned and I’ll let you know how this one works out.

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Categories
Startup Life

The Start-Up Chronicles: Chapter 2. Who, Part 3

Using social software to avoid building something that someone – other than me, thinks is awesome.

Once you have the community, let them tell you how to improve your product by exposing your engineers to the cheers and jeers. This type of feedback is one of the greatest values of a community.

– Reality Check, Guy Kawasaki

idea - who
idea - who
Transparency

In the spirit of openness, I just want to state that this post is a plug for the wonderful folks at Cynapse and their awesome and even at times inspiring, social software platform – cyn.in.

Outside-in software development

The underlying theory behind outside-in software is that to create successful software, you must have a clear understanding of the goals and motivations of your stakeholders. Your ultimate goal is to produce software that is highly consumable and meets/exceeds the needs of your client.

– Wikipedia based on Outside-in Software Development: A Practical Approach to Building Successful Stakeholder-based Products, Carl Kessler & John Sweitzer

Now Guy, Carl & John can’t all be wrong – developing software solutions in an ivory tower is no longer an option. As any external & internal stakeholder will tell you, you need feedback – especially in the world of global development & delivery (GDD). So how do you connect all these people from all over, with different skill-sets, different perspectives and most importantly different roles and rights? For example;

As a Developer (Internal Stakeholder), I would like to see Customers’ (External Stakeholders), comments on how they interact with the system, so I can better understand what value they’re trying to achieve.

As a Founder (Internal Stakeholder), I would like to collaborate with other Founders on our financial planning by sharing discussions, files and bookmarks, so we can communicate in a more timely and efficient manner than email.

Both of these scenarios involve the sharing and disseminating of information. However, not necessarily across Developers, Customers and Founders.

The state of the solution – Version 2

Having software development & start-up in my blood, I was thrilled to see the state of cyn.in. What the solution lacks in features, as compared to some of the competition, it makes up for in design, ease-of-use, quality and support.

Business Model

I think the business model is great – its got something for everyone. For the techies, the open source model is a great way to use & potentially contribute to the code. For the folks looking for a free open source solution to experiment with, the VMware image provides the cheapest simplest in-house solution. And for those who want to avoid any hardware/software/networking issues and assure themselves of timely & helpful support, then the Software as a Service (SaaS) offering is the route to go.

One weakness

For now, the one weakness is lack of documentation and knowledge base contents.

A few benefits

Since I consider myself a cyn.in early adopter, I hope to contribute to the requirements process – with my own spin of course 🙂 In addition, I’ll be blogging / tweeting about how we compliment certain features in their infancy with other solutions to achieve our desired results. Why am I doing this? Well, in the interest of transparency, I get a preferred SaaS deal for helping out and I better position myself as a potential reseller & service provider. However, most importantly, I actually do enjoy this stuff. And I will especially enjoy myself if I can contribute in a meaningful way to what I trust will be a distributed software development effort in an outside-in agile environment.

The state of the solution – Version 3

In addition to Enterprise Support, another SaaS benefit is being seamlessly migrated to the latest release – which by the way is as gorgeous as the Adobe AIR desktop client. If you’re currently a cyn.in Version 2 user, then moving to Version 3 should be one of your priorities. If you’re not, then Version 3 offers every feature you’d expect from a social software platform – minus some functionality. For example, while there are calendar Events, they lack the ability to invite members. Until that’s enabled, we supplement cyn.in Events and with Google Calendar. In my opinion, a minor price to pay.

World-class support

For whatever cyn.in lacks in documentation, they more than make up for it with their Enterprise Support. Despite being timezones away, I can always count on a timely, concise and helpful experience. There’s seems to be no question too small, or, bug too big for them to answer in the same courtious manner. And in those special cases when I do come across a missing feature, it’s nice to know that my input is used to help contribute to their development process.

A future post – User roles and permisssions

A key feature for this start-up community is the ability to control user roles and their permissions. Currently, we use Personas to help us in our development effort. In the near future, we’ll be ready to search for actual users to assume their own personnas and help us define and satisfy their needs. When that time arrives, I’ll describe our community’s site hierarchy and permissions for members to better understand how they fit in.

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Categories
Startup Life

The Start-Up Chronicles: Chapter 2. Who, Part 2

My Idea’s Unhidden Agenda, also known as, Work-For-Attribution, and how I hope it will attract community members and contributors – the Who.

Imagination: Albert Einstein said, “Imagination is more important than knowledge.” Leaders create things that didn’t exist before. The do this by giving the tribe a vision of something that could happen, but hasn’t (yet).

You can’t manage without knowledge. You can’t lead without imagination.

— Tribes, Seth Godin

idea - who
idea - who
Trying to avoid my own Groundhog Day

As written in my Part 1, I needed to find a way build on my lessons learned and try my best to avoid repeating any errs of the past. But even more than needing a way to attract members to my new tribe, I needed to find a way to give them an environment where they could go beyond simple contributions. I needed to find a way for them to build their own opportunities, own quests and maybe even their own tribes.

The Unhidden Agenda

So a little while back, I came up with the following for my collaborators:

How to make this viral
I was also wondering how to make this a community project where we could create the engine and enable/empower other communities to use/build/extend it for purposes we haven’t yet considered, or, may simply not be in our domain of expertise.  In other words, make it “viral”.

This is what I’ve come up with so far
The core engine – to be defined later, is the center of our community.  If you’ve read Seth Godin’s Tribes then you already know that every community needs a leader.  That would be me – Steven Milstein.  And while this is not a democracy, that certainly doesn’t mean that I won’t hear & listen to the members of this tribe.  Now that may sound harsh but, please hear me out – I’m not finished yet.

Since you’re here reading this, then I’m going to guess that you like the idea, or, appeal of leading – maybe even a tribe of your own.  It may not be today, but someday in the foreseeable future.  If this is not the case, then I deeply encourage you to give this some thought.  Because what I’d like to see is each of us exploiting this opportunity to seed own tribes with this core engine.

Unhidden agendas
What I’d like is for each of us to create an entry here with our Unhidden Agenda.  Describe what it is you hope to gain by investing your time, energy, maybe money, in this venture?  (Don’t tell what you can, or, cannot invest.) You have to be honest & you have to be passionate.  Once approved/agreed upon, this Agenda will then represent your social contract to this endeavor.  Break your Agenda, break your contract – you’re out.

I’m not dead certain about this idea & am certainly open to your feedback.  But until then, I think this Unhidden Agenda Model will scale & encourage others to not only participate but contribute.  And if we truly believe in outside-in agile/scrum software development & we strive to maintain the integrity of the core engine then each of us should be able to fulfill our agenda.

For example
My (Steven’s) Unhidden Agenda will elaborate on how I’d like to be the product manager/owner of some leading edge social software product. I’ll go on to say how I want to use this endeavor to prove that I can not only be just that but, also have a touch of vision and more importantly, that I deliver.  I’d also like to boast about the community/communities I seeded and onboarded to social software.

I imagine [Retail IT Guy/Gal] ‘s entry will focus on their retail domain of expertise & how they would like to cultivate their own tribe.

For [Software Engineer Guy/Gal], I can see them seizing the opportunity to build the core engine in their own technical fashion and then sharing & expanding its APIs with the technical community of this growing social network.

Next steps
As I said earlier, this is not written in stone but I would like to find a way to make this more than three guys who live in Montreal.  If we’re all somewhat comfortable with this approach, then here’s what I see happening next:
1. Work & finalize on our agendas
2. Get to work on building a simple proof-of-concept
3. Start blogging about what we’re doing here & post your Unhidden Agenda
4. Find & contribute to your related communities
5. Seek feedback from others & maybe ask a select few join us in our Community
6. Invite some of those to publicly blog their own Unhidden Agenda in the hopes of gaining admittance to this exclusive community – exclusivity matters. (If you believe Seth Godin.)

My back of the napkin “Work-For-Attribution Agreement”

While I originally sought a lawyer’s opinion about the Idea’s monetization possibilities, I was immediately told not to proceed without securing my copyright and ownership of “said” Idea. And that’s when I had visions of Groundhog Day. To be very clear. I did not then, nor do I now, have any money. I did not then, nor do I now, have the time, nor the resources to expend on fantasies and illusions of gazillion dollar exit strategies. This is my Reality Check. (By the way, if you click on any of the links that lead to Amazon and actually buy the book, then I get something back – although I quite honestly don’t even know that that is yet, through their Associates program.)

So as of today’s date, this is the best I can offer:

Whatever work you contribute will be considered “work made for hire” and for whatever reason that may not hold up, then the agreement will be considered a “copyright assignment” from you to my company – Milstein & Associates Inc.

Sounds harsh, eh? But, it is what it is. I’ll post this digital back of the napkin version in the Idea’s community site so folks can sign up – at least in the digital sense.

Now in lieu of any payment, what I hope to do – subject to lawyer approval, is offer an Attribution for your contributions. Something like movie credits, or, if you open Adobe Reader, click on the Help, About, Credits button – for starters. Ideally, as stated in the Unhidden Agenda, I would have to provide a mechanism and venue for folks to discover and explore your contributions, maybe even for you to start your own tribe.

Up next – The Community Venue

My next post will be about the Idea’s Community site and who would be its target audience.

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