Thanks to Guy Kawasaki I just stumbled over this brilliant article, which should not be missed by anyone following Kaplak, or by any online startup for that matter.
Written by Frank Kochenash, head of Strategy and Insights in Avenue A | Razorfish’s Seattle office, the article stems from the company’s 2008 Digital Outlook Report (PDF). In the piece, Kochenash addresses the role of users ‘as advertising models evolve on social networks, and [...] how users should be compensated as the economic models on these properties mature.’ I specifically note the following predictions of what’s going to happen in this field which Kaplak operates in :
Expect to see increased competitiveness and specialization among social media sites and utilities, each trying to differentiate the network through perks available to members. The fragmentation of social media sites implies four other effects:
1. Advertising networks that can effectively leverage social information will become marginally more important.
2. Widgets, as vehicles to carry a message effectively within and across various social media environments, will become more popular.
3. Exchanges or clearing houses will arise to provide compensation in some form (e.g., cash, rewards, points, status) for users. [wouldn't call this compensation though, as 'users' rapidly converge into 'producers', but rather to connect and facilitate transactions between users]
4. Niche social media will become attractive places for brands to engage in SIM [Social Influence Marketing] because relevance can be increased.
Emphasis and comments in square brickets are mine.
Kawasaki was allowed to make the complete report available on his blog - he recommends getting it before they change their mind. Like Kochenash’s piece, the full report is stuffed with the kind of insights and backed up data which can make any online entrepreneur drool, because they can use this stuff to back up their business plans and their otherwise very-hard-to-document assumptions.
Can’t help but post this, because it’s the funniest commercial I’ve seen in the last five years :
Thanks to Jason Calacanis for the tip! It’s an example of what twittering can do to a message. It’s not as hard and effort-demanding as blogging, and the message gets through to everyone following the twitter.
In this case, a video commercial gets spread online with lightning speed. What’s amazing is how few companies deliberately and strategically use these channels for their messages. I’m not even following Jason very fanatically, yet here I am bringing on the message in this space. I also added the video to ‘my favourites’ on YouTube, which makes the video visible to everyone following my videos. I added Jason to my “following” because I knew his name from other online activities and discussions and was curious to explore different twittering styles. Jason is very consciously using Twitter to promote his site and live video streams.
For mainstream media such as this commercial, it’s shooting with a wide arc in a channel like this. But more targeted messages (such as niche products) could use social media wildly efficiently, to help build a following. I just read, that Barack Obama twitters too, and he’s had some luck with it ;-)
Or do algorithmic search really scale better, work faster and ensure better quality than ’socially produced’ services? A few days ago, I had an interesting exchange of POV’s with Danish SEO Mikkel deMib Svendsen, known among other things from the SEO radio show Strikepoint.
I replied to Mikkel’s blog post on ‘Search - before, now and in the future’, where I tried to make the point that search as a communications solution suffers from key preconditions, which are far from optimal. Among these the fact that in order to search for something, you need to know what to look for before you search, and you need to deliberately and consciously use a search engine to look for it.
In other words, search is a deliberate and conscious affair. This makes it difficult, for instance, to use search to market products, which are not well known, such as niche products, or to address problems or needs, which are not yet consciously thought or expressed.
Add to this the present growth rates of information on the web. For each new website added to the web, you increasingly risk that your information will never reach the queries seeking it. We’re talking exponential growth rates in several millions of new websites, added each month to the web. As Search faces these increasingly greater amounts of information, this problem, which we’ve so far dubbed the mainstream problem, will only become more apparent.
Mikkel, however, firmly believes in the future of algorithmic search, so these claims didn’t go uncommented. First, he argues that machines will always work faster and scale better than social services, which has great filtering and quality challenges :
I am completely in line with Louis Monier [founder of Altavista], and am 100% certain that algorithmic search will remain dominant. Manual data processing, like in the [online] social services, simply suffers from too many scaling and quality assessment-issues to compete in the long run. Only machines are scalable on the necessary scale and with a continued central quality assessment. … [my own translation, MB]
I have a few problems with these arguments for the quality of search as a communications method. I wanted to analyze them a bit here, in order to make them part of our process to find out more about the effectiveness of online communication and it’s niche/longtail effects. Over the past months, I’ve come to question the widespread naturalization of search as ‘the best’ and ‘natural’ method of making information available and visible online. True, right now Search is the dominant method for obtaining information online. It is also a billion dollar business, although this is mostly due to the success of Google AdWords/AdSense, which is quite a different product. However, this may not be so in the future.
The part of Mikkel’s argument which makes a distinction between social services on one hand, which are manually created and processed (by humans), and search on the other, which uses machines and algorithms, and therefore scale better etc, is fundamentally flawed.
First, search results are ‘peer production’ almost as much as any online social bookmarking service is, i.e. they are socially produced. Peer production is a term coined by Harvard professor Yochai Benkler (in The Wealth of Networks (2006) - which can be downloaded freely here). That search results are peer production means that they create value by putting together websites from different peers (i.e. companies, organizations or individuals) in order to respond to a search query. Google does this without even asking the peers first (it’s an opt-out, not an opt-in system), and so the peers used to create value may not even know that they contribute value to this system. However, this doesn’t detract from the fact that it is the sourcing and pooling together of the work of different peers as a response to a human search query, which creates value in a search result. A search result is socially produced, even though the work done filtering and presenting it in few seconds is done by advanced programming, software, hardware - and cables.
These advanced architectures however, are also created by humans, which means there are someone sitting and using their human capabilities to decide what categories and what variables should factor in with how much weight in the algorithms which control the process of finding and delivering information, when somebody searches for something particular.
The problem with this is not that the process is just as human-influenced as any online social bookmarking service for instance, but that the someone deciding what variables should factor in, is (most likely) not an expert on what the someone at the other end typing in a search query is looking for. The other someone is. It’s one size fits all. One architecture (in principle) for all queries in the world.
I tried asking Mikkel how he could be sure, that a query actually met with a usable result. Even if a query is answered by a number of search results, this doesn’t mean that the search results are actually usable and delivers the answer to the query. If this user experience is bad, search fails in delivering an answer, even if there are a million hits on the query.
Let’s take a look at something completely different, i.e. this page at Wikipedia. Notice the edits happening to the article “Tsunami” in december 2004? A page which before december 2004 had minimal contributions and edits made to it, literally exploded with new information, when a tsunami this month devastatingly hit the coasts of Sri Lanka and Thailand. Everything was frequently updated as events rolled along and people in different parts of the world found out new things about what had happened, complete with a small animation to go along with it.
Wikipedia aims to make knowledge freely accessible to anyone on the planet. Like providers of algorithmic search, Wikipedia uses lots of machinery to deliver it’s information, as well as an advanced complex of software architectures. Wikipedia’s articles are peer produced, but much more directly and consciously so than the algorithmically created search result we saw earlier. Even the software is peer produced. MediaWiki is free software, which can be copied and worked upon by anyone who wishes to do so, and any changes may be adopted by the main package.
A second point is the difference in value created. With an example from his own work, Mikkel illustrates how Search Engine Optimization (SEO) done right directly creates great surplus of value for the companies he and other SEO’s work for. Regular SEO maneuvres help direct lots of relevant traffic to the corporate websites.
That SEO helps create value, however, by more directly targeting traffic at corporate websites can’t be said to be an argument for the quality of search as a communications solution in and of itself, but rather for the quality of Mikkel’s and his colleagues’ work. There’s a lot of money in SEO, and that’s not because search is a brilliant solution to a communications problem. It is rather because search is inherently insufficient as a solution to the problem of connecting a query/demand with an answer/product, especially for a company which wants to stay alive and gain a competitive edge. And this problem will grow a lot bigger. I predict that Mikkel and his SEO colleagues will be paid even better in years to come.
It is first and foremost a problem of visibility, not particularly of search. We need to create better ways to make information accessible to the people who need it, without swamping those who don’t. Second, it is a problem of speed, because we need information fast, to better meet the challenges we face, as individuals, organizations and societies.
As a non-profit, Wikipedia doesn’t make any money on the processes involved in creating and building a quality article, but the value that an improved Wikipedia article (such as the tsunami article) provides for millions of journalists, for instance, and the newspapers and media companies which employ them, is indispensable. I know for a fact that reporters use Wikipedia a lot, and with good reason. It is the fastest and most scalable source of information online, beyond any doubt. And when as many contributors as in the tsunami article come together, it also proves a highly reliable and credible source. It beats the crap out of trawling search results pages without finding what you’re looking for. But it is only a small example of what peer production is capable of, given the right architectures and tools.
Kaplak is undergoing some changes re: ownership and leadership these days. In short, we’re abolishing the Association of Kaplak Investors in favor of a company with clarity of ownership and leadership, and we’re doing it a bit sooner than originally anticipated. I’ll get back to why in more detail in a later post, after all formal proceedings. I just wanted to line a few things up about what’s in the pipeline :
We’ll be looking high and low for a high-class webdesigner, possibly at partner level.
We’ll start building our public wiki!
We’ll complete our “investor business plan”.
We’ll complete a pre-springboard with ConnectDenmark, which is a Danish organization who promotes and connects innovative businesses with investors, in particular growth oriented, scalable businesses and (mostly) what would probably be termed angel and seed investors in an international context.
Last, but not least, we’ll develop and launch our initial range of complementary products, i.e. services and products which complement our core idea, can give us customers and income streams, as well as further data and information on our customer’s core problem. This all means we can fund Kaplak’s core product development.
In other words, lots of hard work ahead, with only too few hours.
Lynge gave a course of high inspirational qualities which I think made everyone in the room think really hard about their businesses, and about what kind of capital they need, how they’re going to get it, and how they’re going to communicate about what they intend to do with it, when or if they get it. Maintaining relations with the capital markets is a long term concern for companies with ambitions about growth and building a scalable business. You can follow my notes from the last two days’ course on Twitter.
