It seemed like everyone was high on the blog as a business model in the mid 2000′s; and why not with adwords from Google providing a rich source of income, low startup cost, and the rapid growth of online viewership it seemed the perfect business to jump into. That being said, blogging isn’t an easy activity nor a lucrative one unless you really come forward with something.

Keys to Success

First mover advantage – This is usually good for any business but especially necessary for the blog. Attracting a loyal crowd in an area where no one provided a like product (or one that was easily found) is huge.

A captivating idea – It’s not enough to build it up. It needs to be something that the masses want. I’ve gone forward with 2 ideas now MGMTNOW (branding/product marketing advice) and ZunedOut (Music blog focused on Zune). Unfortunately, both the areas I’ve selected don’t have a large enough following to really ramp earnings with.

Amazing Marketing – Marketing is a little different on the internet, its all about being linked to, getting the right search results, and utilizing Web 2.0. My experiences with Google really turned me off to Adwords for a blog. I think the costs especially given some of Google’s methodologies in their business model don’t align well with a product that is ad funded. This is not saying that a good organic result isn’t necessary. My experience was that the easiest way to push business was through Web 2.0 sites with rabid users.

Stumbling Blocks

Yada Yada Yada – You talk but everyone just hears you flapping your mouth. While readers demand content they only care about it if it’s meaningful. Writing a post just for the sake of getting something out there is a detriment.

M.I.A. – My biggest problem here. When you don’t want to fall into the “I say a lot but I don’t say anything trap” you can just as easily fall into the silent treatment and erode your base. I know after being laid off I was a lot more focused on other activities, and went 3 weeks between posts. General rule of thumb is if you don’t post once a week and you haven’t built a solid following they will likely leave.

Overly invasive monetization – The thing that gets you paid, is also the thing that your users appreciate the least about your site. Finding the right balance is key.

Conclusion

With the downturn in spending on advertising, its not as easy as it once may have been to watch those AdSense checks roll in. With the right focus on your offering, and a consistent approach of holding your viewers interests and being respectful of the presentation of the product offering there is still an opportunity for large return. Just remember for every website that claims they can give you the secret sauce your real secret to success is understanding a customer base and tackling their interests in a meaningful way.

Ever wonder how to get a project green-lit? Well fortunately for you I’ve had plenty of experiencing building these sorts of decks and am sharing it right here at MGMT Now. Please note we’re on a blog here so this PPT isn’t going to be the most graceful or amazing presentation of all time (I don’t have the time to do that for a freebie).

What you should come away with:

• How to structure a project document to get an investigation off the ground.
• Telling a compelling story
• Different aspects of a product/project that must be considered
• Easy, quick way to structure ideas to get what you want

See the PDF covering the presentation below:

Project Management 101

I’m starting up a new blog (Zune’dOut) based upon one of my branding/product ideas, but it most definitely won’t be a branding blog. I will continue to post on mgmtnow, and hope this will get me posting more often on both.

Focus

I’m super passionate about music in general, and specifically the Zune product Microsoft offers. Unfortunately I think Microsoft has really missed the boat on their marketing strategy for this product, and this is why they’re hovering at 3% market-share.

The Zune’s key differentiator is that it allows you to download unlimited music (so long as it’s on the pass) and keep it until you cancel, in addition you also get 10 songs a month rolled into the deal all for $15 a month. Think of this product as Netflix where they let you keep 1 movie a month.

The Problem

People were used to renting movies; no one is used to renting music. Netflix spent millions and millions on marketing to create an effective brand and get people used to the idea of subscription based renting and mail delivery.

Unfortunately, Microsoft has focused their marketing resources on trying to create a Zune is sexy image, when Apple the purveyors of everything sleek and revolutionary in design are the market leaders.  I don’t have the figures but given the subject matter of the tv ads I have seen I can’t imagine the subscription marketing efforts amount to anything more than 25% of advertising budget.

My Solution

One of the biggest challenges in a subscription system is keeping customers engaged. Netflix spent millions to create a profiling recommendation system, including a contest that led to a $1 million payout to a programmer to improve the algorithm.

I think Microsoft should be crowd sourcing their “algorithm”, now I’m not saying they have to get a bunch of programmers to improve the marketplace (not that it wouldn’t help). No I’m talking about encouragement, ecosystem building, and creating more features around music sharing “djing” outside of their current social efforts.

Since I see this as a great way to drive their subscriptions, I decided it would be a good project to undertake and see if I could get any traction behind.

Possible Revenue Streams

The standard AdSense model of revenue generation is obviously one way to go. Another interesting revenue stream may be Zune’s affiliate system, whereby they pay you a set fee for every Zune

*Disclosure* I worked at Microsoft, but have zero insider knowledge on the features announced today for Windows Phone 7. I don’t know how they work, I’ve never seen them demoed or in any PPT. If you’re looking for a leak, look elsewhere. My commentary on any features is purely speculative and done as a consumer of said product, and where I see each product going. The only insight from my time at Microsoft is tied back to the challenges of working cross orgs.

My thoughts on Microsoft Culture and WP7

From my time at Microsoft I saw huge challenges in taking on projects that crossed over multiple stakeholder groups. This was actually an area in which I really excelled in, but always questioned how well the company did on this.

Well today I woke up to a surprise, a very pleasant surprise….. Windows Mobile Phone 7. I worked in an org. pretty close to MCB (Mobile Communications Business), we had a lot of the same ideas of leveraging Microsoft properties for a winning experience for our customers. Unfortunately, there were a ton of agency issues, getting people on the same page was always a challenge, and integrating conflicting business models was messy at best.

Whether or not Windows Phone 7 hits the ground later this year as an “amazing product”, or even a “commercially viable product”, it is a huge win for Microsoft. It’s the first product I’ve seen break down all the walls that Microsoft has built with their businesses and deliver the extent of the value of integrated services to the consumer, and that’s huge.

Some of the features I saw and what they mean:

Xbox –

Currently:Doesn’t have a mobile market at this juncture, didn’t even have solid Zune integration.

What we’re likely getting:A fully integrated experience with Xbox, Zune, PC, and Phone. Plus online gaming, and services on a mobile device, which is something no one else has…. not Apple…. not Sony …. nor Nintendo.

Zune-

Currently:A model focused around the player, when it’s the service that really makes it standout vs. Apple. An anemic mobile purchasing system hampered by lack of connectivity outside of WiFi.

What we’re likely getting: The best music subscription service available to the phone. Better integration with contacts, and social networking for this product.

Bing-

Currently: Actually probably the best current service of any I’ll list from the WP7 features. Lots of cool features but its very under-utilized.

What we’re likely getting: The best chance for Microsoft to make headway into search. Google owns the desktop and will continue to own that. The mobile search market will eclipse that market though and drive higher revenues as location based search offers way more value to customers and businesses.

Office & Exchange services –

Currently: Not well designed for the phone (except for Exchange). Looks like a child’s finger painting next to the sexy (I can’t believe I just called Office sexy, I may need a girlfriend) Office ribbon interface.

What we’re likely getting:WP7 took the best UI available (from Zune) hopefully they take the best UI in productivity from Office as well. It will also be interesting to see the integration with the online services like SharePoint, and Project.

Why This is Great for Consumers

I’m not an Apple supporter but a fully integrated all up approach of software, services, and hardware is the best way to deliver a consistent pleasant experience to your customers. When you look at Microsoft as a whole they have all the pieces to deliver the experiences that Apple does, but sometimes the organizational structure gets in the way.

Seeing a product cross over these boundaries taking the best of what each group offers is huge, and quite honestly wasn’t what I was expecting. So for today there’s nothing but optimism for the Windows Phone, maybe the rebranding was necessary because this doesn’t look like your same tired Windows Mobile 6x device.

If you want more information on the Windows Phone check Gizmodo, an awesome publication for tech-gossip and research.

 “The term “Black Friday” originated in Philadelphia in reference to the heavy traffic on that day (see Origin of the name “Black Friday” below). More recently, merchants and the media have used it instead to refer to the beginning of the period in which retailers go from being in the red (i.e., posting a loss on the books) to being in the black (i.e., turning a profit).”

What else can Black Friday teach us outside of retail dynamics and health of the general marketplace? Can the deals that can be had on specific goods show us a trend in the marketplace?

Deals That Point to Irrelevance

One of the deals pointed out as a screaming deal were the $59.99 GPS unit from TomTom that Walmart had advertised. While these were quite a hot seller, and terrific deal for customers what did this deal really signify about the long term attractiveness of this category?

Seeing a TomTom GPS at such a low cost was a surprise this is a move I’d have expected from an also ran competitor not one of the two market leaders. This move follows news of Google’s map and turn by turn being added to the Android mobile phone platform, as well as aggressive movement from Apple into this field via the iPhone.

We’re likely seeing the slow extinction of the handheld GPS due to convergence with other products specifically phones.

Deals That Point to Maturity

LCD televisions so cheap they make and Xbox360 seem expensive? Yes, we saw those on Black Friday $248 for a 32in LCD or $450 for a 40in display. These all point towards the movement into the mainstream that is the flat panel monitor. I can remember two years ago when $1000 for a 42in DLP TV was a screaming deal. Now the future of DLP seems grim since its most attractive competitive advantage was price.

In addition we’ve also seen a $78 Blu Ray player. This along with the price point for the tvs is showing that high definition has arrived for your average consumer. 

We’re likely going to see the complete transition away from CRTs and DLP tvs, alongside Blu Ray grabbing a increasingly larger share of the DVD business.

Deals That Point to Future Categories

While we could more accurately point to last Black Friday as the rise of the Netbook this holiday season we’re seeing increasing inroads in this category. With the Netbook hitting $200 a price point I’d expect from a higher end appliance not a low end computer, this category is really starting to drive share in the PC space. 

The question OEMs increasingly have to ask themselves though is how do I trade a $600-1000 purchase for a $200 one and still make money? Is this something that can be accomplished by scale? Maybe sell it as “your second pc”? Or do you partner with service providers as some are doing to provide a “connected anywhere” experience that can be monetized.

It will be interesting to see, but I see Netbooks as a driver for lower cost wireless data services, and increasingly will change how we think about mobile computing.

Conclusion

We’ll see how these predictions end up but it’s almost as fun to look at what these sales could mean as it is to see what great deals exist. It is important to note the examples and what they can mean to positioning for your product in the retail space and holiday shopping.

I’m currently in the process of building a business model around a patent I filed a few years ago so this is top of mind. Creating value usually boils down into one of three categories either its the product, a service, or the distribution of a product. If you’re not a manufacturer or creator of the product you’re going to be focused on the service aspects or distribution as your key value add.

Business Models Focused on Distribution
Often this is an overlooked opportunity to differentiate especially by manufacturers as they tend to want to focus on product or services. This could result in failing to see a different channel for the product, or an inability to create product offerings that hit different segments. Especially with software this can be a critical error due to the monetization possibilities licensing unlocks.

Value of Distribution
By no means is this an exhaustive list but just a couple ways you can add value through distribution:

Speed of Delivery: Examples like McDonalds show us the advantage of creating a distribution mechanism that enables fast delivery of a specific good being used as the key differentiator in a business.

Consistency: Being able to deliver a repetitive high quality experience every time like Starbucks. Many would argue there is a better cup of coffee available to you every day, but Starbucks can guarantee the experience due to rigorous training and standardization.

Price Points: Walmart and Costco focus on reducing price by putting price pressures on suppliers. Their  sheer size and willingness to just not carry a product if the cost isn’t favorable enable them to compete on price in ways other businesses can’t.

Licensing: Being able to take one product and deliver it in many different channels hitting new price points and customers. Anti-virus software is a good example of this with the ability to push the same product (sometimes with a couple additional features turned on) via box product, volume licensing, or subscriptions.

Location: This could be anything from shelf space in a supermarket, to having a presence in the mall, or presence on a web property. This is all about opportunity andtraffic. 

Audience Targeting: Enterprise Rent-A-Car is a great example of how location as a pillar of your business model can make your business stand out. While other car rental companies focused on travelers Enterprise focused on people who had disruptions in their everyday commute option due to repairs or auto-accidents.

Conclusion
The phrase “a product so good it sells itself” is a fallacy. A strong business considers its distribution channel at least as seriously as it did its product creation if not more so. A mistake in these areas can make you easily irrelevant even if your product is great.

The other day in the comments there was an inquiry into why I’d stopped posting sections of the Creating Value eBook. My core audience of the site is divided between entrepreneurs and business professionals, and the eBook leans very heavily onto the entrepreneur side.

I had decided it would be best to stop  inserting the sections and just get the Creating Value eBook out instead. My goal was to have a more polished product with better formatting some pictures, and flare. Unfortunately, that’s been delayed.

Given the ask though the straight forward solution was just to post the raw eBook here so that the knowledge could at least be shared.

Goal: My hope was with this eBook I could create an easy straight forward set of questions a entrepreneur could ask to begin to understand what their product is and how they should go about selling it. This might be a bit rudimentary for those with extensive Product Management experience but  I think there can still be some value there.

Enjoy

MGMTNow Value Prop eBook

Dating and finding a new job in many ways are very similar activities. When you are involved in that process as a business in a sense you’re playing “match-maker”. It’s not surprising then to find a job hunting site with a model that takes off of eHarmony’s.

Meet eHarmony
Founded in 1997 eHarmony is an online dating site whose approach is to do more than just serving up categorized dating opportunities. They try and stand out by delivering a better product through a “patented Compatibility Matching System®”. The value they are offering is twofold: less time spent shuffling through postings, and a more successful outcome (dates).

Another key feature they offer is what’s referred to as a “guided communication” which is used as a way of furthering communication between prospective couples by providing questions. Acting as a ice-breaker, or a way to get to know each other better, this process is supposed to enable for the best match possible before a date is actually initiated.

Additionally the focus of eHarmony has focused on the institution as marriage. This adds as a secondary filter in addition to the compatibility matching system as most of the clientele have a focus in line with the branding.

Meet Jobfox
Launched in 2005 Jobfox joined the crowded job placement and search marketplace. They try and stand out by delivering a better result through their “patent pending Mutual Suitability System™” (sounds familiar). They’re offering value much like eHarmony: less time spent sorting through postings, and creating more aligned meetings (job interviews).

Another key feature they offer is the ability to be introduced to the decision makers. I’m guessing this is similar to eHarmony’s guided communication but as it is only available to premium members (and not explained in their about section) I couldn’t gather any more information about it.

Lifting Successful Business Models
This is a great example of taking a successful business model in this case “guided matchmaking” and applying it to a new marketplace. The benefits of doing this are that it is a proven model, its one people are familiar with,  and allows you to focus on other aspects of the service or monetization.

It looks like Jobfox has done more than just recreate a similar guided service, they’ve also created a tiered membership service which also reminded me of eHarmony.

The Verdict
I’ve never used eHarmony but I have had friends that have used it and appreciated its value. From how its described I found it to be remarkably similar to Jobfox.  Given my current employment situation, I was actively utilizing Jobfox. Initially I was a bit disappointed with the service as the amount of information I had to enter (see time investment) was substantial. In the end though when I started looking at the matches they presented to me I was rather pleased with these results (as I’m sure most people on eHarmony are).

Conclusion
When outlining your monetization or what your service offering should be you really should explore existing models or similar goods. By doing so you can better understand competitive landscapes, your own unique offer, as well as be given blueprints for success.

I’m not sure if Jobfox is revenue neutral, or even turning a profit, but given my experience I think it has a good chance at success.

The web browser is one of the most important applications that can be installed on a PC these days. Whereas the OS is the window to your device, the browser has become your window to the world. By its nature this application tends to be really difficult to move away from as familiarity, bundling, and shortcuts have made it all too easy to become captive to one browser or another. Or so I thought…..

The Background

I have used IE since back in the times of Netscape Navigator, I started using it because it was a free bundle and I normally look rather kindly on Microsoft products as they work the way I want them to. I was very happy with IE for quite a while, and then Firefox came out.

Now Firefox had some advantages, and about this time IE seemed to be suffering a little bit. Its performance for me, as well as its reliability to “just work” the way I wanted it to became a sore point. So I downloaded Firefox and started the trial run on it. What I found was a more disruptive experience, especially when there was ever a need for Flash installation or some other Applet. I couldn’t understand why I needed all these other downloads that just seemed to get taken care of on the backend with IE.

In the end I abandoned Firefox as the added complexity, inexplicable lack of it just working as I wanted it to, and minimal benefits drove me back to IE.

About 10 months ago I started using IE 8 on Windows 7. While I had felt IE 7 was a pretty solid product IE 8 seemed to turn back the clock and I noticed a huge drop-off in loading pages and performance, especially when I opened new tabs. The frustration to watch IE hang as I just went to check another tab was unbearable but somehow I tolerated it.

A Funny Thing Happened

Now without a company laptop, there came a need to go out and purchase a new machine as just having a desktop would not suffice. I purchased a new ASUS low-end notebook and have been very happy with it. Last night a friend who still works at Microsoft decided to help me setup some applications as he was horrified I hadn’t wiped all the preinstall garbage yet.

It was during his installation raid on my laptop that he took the opportunity to drop in Google’s Chrome browser. This was an option I had not even considered because as a consumer I’ve been frustrated in the past over Google’s business model being based around securing and selling my private information (aggregated or not).

The seeds were planted though; an invading product had made it to the shores of the once high walled castle that has held me as a captive audience and customer for at least 10 years.

Crossing the Moat

There were already cracks in the wall with my relationship with Internet Explorer. Performance was questionable, security some said laughable, but there had also been major fortifications in the IE 8 browser with some of its new features.

As it turns out though bridging the gap between the two products in my fickle heart was 1 small feature, one feature that’s so simple, that is so much a part of so many Microsoft products I cannot believe how it was ever overlooked.

And that feature, was a spell-checker in the browser.

Now just a few weeks ago I told a friend just how laughable Google Docs. was for the simple fact it didn’t even have the little squiggly line that appears under a misspelled word in my gmail account. How could they possibly compete when they can’t even tackle probably the most critical product in the Office Suite in Outlook?

Now I know the answer is that they didn’t include spell-check in any one of the programs because they included it at the browser level, so that it could be useful in many more areas than just the base application.

Is Spell-Checker a Game Changer?

There are many other features we could discuss, both positive and negative, for IE and Chrome; in the end I think this one feature is enough to really cause a shift in market-share.

People have become so used to the spell-check to cover for their laziness, poor education, haste, confusion, and absent mindedness that it is something no one can go without anymore. It is likely in the top 10 features used in Word, and Outlook.

What’s more, it has become a hassle now to have to write all of your text in Word or Outlook hit spell-check and copy it into the site you are using. Web 2.0 is where this feature is most sorely needed. Do you leave comments on a blog? Do you have Facebook, LinkedIn or any other number of social networking sites? Do you want your friends questioning your intelligence when you misspell simple words? Well guess what if you answered yes to the above questions, and no to the last question then you’re a Google Chrome customer period.

A Measured Response

Its amazing seeing the silo nature of a company work against it in this way. There needs to be an immediate response to add in the same functionality to IE 8 as is currently available in Office. Without this I don’t see how Microsoft can stay the dominate player in this space especially with the rise of social networking, and more of our lives and regular communications moving into the cloud.

Conclusion

It took 1 day of use, and 1 feature to convince me to abandon my previous browser of choice that had kept me captive for so long. Seeing this kind of innovation I am forced to rethink some of my positions on Google. For while their business model is abrasive to me, and while they haven’t shown much in the way of converting opportunities to dollars in businesses outside of their core model; they have shown me how to unseat a dominate player by just building a better product.

Why is big business so inept at harnessing the power of new technology? I was reading Mark Cuban’s blog and I just found myself wondering if the Underpants Gnomes from an episode of South Park were more in tune with business decisions than these media companies. Linked below is a clip from SouthPark featuring the Underpants Gnomes obviously strong language will be featured in the clip.

http://www.southparkstudios.com/clips/151040

The Good

Books
I’m not sure how its possible but one of the oldest forms of medium has made the transition to the digital age the most gracefully. Both by offering eBooks as well as capitalizing off bloggers willingness to pitch books to their audiences publishing companies are really doing a great job of staying relevant in the digital age.

Add to that the fact they’ve not seen the huge problems with piracy the other industries are seeing and it looks like the next few years will be quite good for these publishers.

The Bad

Movies
On the plus side bandwidth limitations have mitigated a lot of the potential damage piracy could cause; it just takes too long to download multiple feature length films. Additional benefits movies are enjoying is the inability to recreate the theater experience, and movie subscription services like Netflix.

It’s not all a bed of roses for the movie companies, as torrents have become increasingly popular as bandwidth continues to rise. At the same time because of a reluctance to abandon the first run model on television and sell into online content aggregators like Netflix the film industry is not reaping any of the profits of deals that their own customers brokered instead.

Television
Its hard to imagine something that was freely available (broadcast) or has the depth of content that people feel compelled to spend upwards of $50 a month for would become threatened so fast. They had some good ideas with projects like Hulu, but it seems that even in success they start thinking about how best to fail.

While I’m a big fan of intellectual property management and am a huge proponent of enforcing rights against outfits like YouTube, I still think you have to offer the content up or risk piracy that dilutes the product.

Seeing lawsuits against YouTube for $1 billion I had hoped that would force the content holders to establish the value of the product by promoting it on their own web properties. Whether its pulling content or trying to divert a successful business model away from what made it a solid option for consumers.

The Ugly

Music Industry
Early on Napster had been looking for an exit strategy from the illegal download model to a subscription based model. Unfortunately the music industry was either not capable of understanding the business opportunity of converting music pirates into real customers, or was too spiteful towards the business that built their customer base upon it.

Instead the music industry shut down Napster allowing Kazaa, torrents, and Limewire to become the new medium of illegal file sharing.
Even now the music industry still hasn’t recovered from the wasteland that piracy has brought them. They’ve still yet to establish a lasting revenue stream which replaces the inflated prices of the CD days. They still haven’t fully adopted a subscription model that could bring them a substantial annuity, and while their work with iTunes and Amazon has yielded some solid revenues it has been pennies on the dollar of what it was before.

Newspapers
How it is there are so many bloggers out there making big time bucks and yet newspapers can’t unlock this equation to save themselves from the downward spiral that is the end of the circulation business? I’ve seen bloggers who do nothing but talk about how much money they make and yet they somehow manage to continue to sell advertising.

I don’t see any future for the majority of newspapers as they’re struggling to even figure out how to get online. There’s been a lot of talk about bringing the medium to the iPhone or Kindle but it’s yet to be seen how this will work, and how many papers will adopt this model.

Conclusion
Most of these companies haven’t done a great job of figuring out a solid business model, and it may be because they’re used to having a monopoly. The problem is copyrights don’t mean a heck of a lot on the internet, if one person gets cut off another 20 will upload the infringing work.

These companies should start focusing on the reality that they’re now competing against free, and if they want to engage the audience they better be somewhat more accommodating than they’ve been in the past. It’s not enough to stamp your foot on the ground and expect the justice system to protect you, that doesn’t get your shareholders the earnings they want.