Robert Young writes a very pertinent piece: For Social Networks, 2007 is all about MONEY.
College Kids & Teenagers, two very important demographics within the social networking phenomenon, could, however, be effectively monetized and advertising dollars from Coke, Pepsi, Nike, GAP, Adidas, Bebe, Cover Girl, etc. can easily be harnessed by acknowledging the fact that this demographic can actually participate in “creating” products, and not just trying to blast the equivalent of broadcast advertising (banners) towards them.
In the past, focus groups have been expensive, and companies use the technique to try to gauge the feedback of whole demographics by sampling a handful of random interviewees.
Now, with the advent of social media, a brand like Nike or Bebe could test ideas and garner feedback from literally millions of target consumers – efficiently and cost effectively – long before actually launching the product. These consumers could then be involved in the iterations that a product design often moves through, and by the time it is finally launched, the market is ready, anticipating the product, and because they feel an ownership about creating it, these very consumers will use their vast social media navigation skills to promote it as well.
Of course, for this hypothesis to work, you need segments with time in their hands. College Kids could be an excellent demographic to try this on, with their abundant enthusiasm for new things.
And for an overview of what’s happening in the College Kids segment, take a look at the next report from the Segments & LifeStyles section. For Teenagers, the landscape is somewhat similar, but with some interesting developments, with major Print magazines shutting down in favor of their online strategies (Teen People, for example).
James Governor emailed me this link to a very interesting piece on how talent management is evolving in the corporate world, as Talent discovers how to leverage Personal Branding via online visibility, and corporations discover how to locate Talented people by scouting the Internet.
Yes, this will have long term consequences, as a direct channel gets established between Talent and the Corporations, cutting out a lot of the intermediaries.
Strong voices with unique insights and perspectives must invest energy on differentiating themselves, and gaining visibility
The theme has been played with so many different storylines over the last thirty some years. And now, yet again, the web’s developments are rewriting another new script along these lines.
On the Internet, if you are trying to launch a new product, service or site, and if the Geeks have appetite for your offering, you have ahead of you a very clear, crisp, and cost-effective marketing machine. Read the new report from our Segments & Lifestyles series on Gadget Geeks. It includes top destinations for eyeballs, advertising costs, and other valuable information.
Also, since the segment is getting a lot of advertiser interest, investment is also following, as evident in the new $8.5 Million financing of Digg. So, if you’re noodling an idea, or a deal to invest in, have a look at the report to check the landscape.
I always find it useful to take a look at data and synthesize trends from them. So here are a few pointers to good data sources:
IPO Home does a good overview article on 2006 IPOs. After a couple of years of a lack of interest in technology, WAN optimization vendor Riverbed Technologies topped the best performing US IPO list.
Not surprisingly, one of the year’s most hyped IPOs, voice-over IP (VoIP) service provider, Vonage Holdings, went public in May at $17 per share and immediately plummeted to only a fraction of its offer price. An expected disaster. >>>
It has always irritated me endlessly, the quintessential Indian lack of respect for time. Here’s Satish Dey‘s piece:
Let’s Have More Watches To Make Up Lost Time
Modern life demands that man should be strapped to a time-machine. Can you imagine managing your life without a watch? I remember the tension and inconveniences experienced on occasions when my watch had refused to move.Yet, only 25 out of every 1000 Indians have got the prized possession of a watch whereas the global average is 250.
According to a report, India manufacturers about 12 million watches a year and the world annual production is 600 million watches. It is claimed that over 50% – 75% of watches sold in India are imported through illegal channels. There was a time when having a Swiss-made watch was considered by many as a status symbol. Thanks to the brand building efforts by the domestic watch manufacturers, watches made in India meet a sizeable demand of the domestic market.
India is racing to become a super-economic-power and Indians need to imbibe the value of time. Whether having merely more watches will usher in the change, time alone will tell. Those who are at the top echelon of society should lead by setting examples of respecting the importance of time. Others will follow suit.
So, let us have more watches and learn to respect time!
Whether or not you agree with that last conclusion, you must read the post.
And then, ponder the question on the future of Yahoo, upon which much of the Internet industry’s future rests. Is the Internet going to become a monopoly, with Google dominating sans competition? Or is it going to continue to be a duopoly (with Yahoo as the challenger), an oligopoly (with further challenges from Microsoft, Ask, etc.), and such which include certain competitive pressures?
Microsoft’s age of total dominance of the PC era had a constant nagging factor : Apple. Not only did Apple continue to provide the ideas and innovation into Microsoft, which the latter happily copied, time and again, but in the end, Apple also came up with the iPod, a leapfrog event in the industry that most effectively combined the PC’s powers with those of the internet, simplified with absolute mastery, and designed to perfection via Steve Jobs’ immaculate vision.
The difference in Google is that they not only lead the industry in terms of revenue and market share, they also are a substantial R&D force, having accumulated a great percentage of the world’s computer science talent under one umbrella.
What role then does Yahoo play? It is no R&D powerhouse. Neither is it the revenue / market share leader. In fact, mired by hairy management challenges, saddled by non-cutting-edge technology, Yahoo, yet-again, is in a turn-around situation.
Terry Semel had been the knight in shining armour, who had delivered Yahoo 5 years back. Who will do it this time?
Below is an interview with a long time friend, Paul Asel, who now works for the IFC’s venture investment arm. I worked with him a fair bit when he was at Telos.
Paul Asel is a Principal Investment Officer at the International Finance Corporation (IFC), the private sector arm of the World Bank, where he is responsible for investments in early and growth stage technology companies in companies in emerging markets with a primary focus on India. IFC has actively invested in emerging markets for 50 years and currently is investing over US$6 billion annually across over 75 countries in which it has a presence. Paul’s current investments include IBS Group in Russia and DQ Entertainment, iLabs Group, Indecomm, KPIT Cummins, Newpath Ventures, Nevis Networks and Spryance in India. >>>
2006 rolled along, into a gorgeous California New Years day to ring in 2007. So, first, Happy New Year to all of you, readers.
A few quick notes on how I see the summary trends of 2006:
– Some sectors of the technology market have recovered. The venture capital market continues to be spotty, although, consumer internet is pretty hot these days. On the other hand, private equity and tech-lbo’s present a very active market, a new development that started last year, and has really taken off this year.
– An instinctive human need to connect and share has blossomed into a full force social-networking boom on the internet. This aligns well with the pre-teens, teens, and twens becoming almost fully “online” in America. These, coupled with the bandwidth and technology developments in online video, are creating rampant online activity. User-generated content has emerged to become a mainstream phenomenon, now.
– Elsewhere, especially in China and India, connectivity growth numbers are staggering. Mobile phones, too, have made a real significant difference in third world cultures. Almost a billion new consumers will enter the global marketplace in the next decade as economic growth in emerging markets pushes them beyond the threshold level of $5,000 in annual household income—a point when people generally begin to spend on discretionary goods. From now to 2015, the consumer’s spending power in emerging economies will increase from $4 trillion to more than $9 trillion—nearly the current spending power of Western Europe. Much of this consumer spending will include technology – from bandwidth to electronic gadgets – sending the unit sales in semiconductors through the roof.
– Outsourcing and leveraging global talent pools have become mainstream. All multi-nationals have committed Billions to India, China, Eastern Europe, etc. to not only harness the cost advantages, but also to access global talent pools. Startups will continue to have a very hard time attracting talent, as MNC salaries are astronomical.
– Air Travel continues to be super tedious, the experience continually degrading. While Saddam Hussain was hanged, the search for Bin Laden continues. Terrorism constantly disrupts life here and there, and causes further friction in the travel infrastructure. This is unlikely to change, so using technology to reduce the need for too much business travel is highly desirable.
– Awareness about the environment, depleting energy reserves on the planet, and other “clean”/”green” issues have heightened in 2006, and investors have started chasing cleantech deals in droves. Likely, this will cause thinking, R&D, innovation, but will also leave a lot of carcasses alongside the road, as these are not easy investment areas. An example: a water purifier that can work wonders in rural India or Africa may sounds fantastic in theory, but the lack of channels to sell these alarmingly low price-point products to a fragmented, low-income population will not be an easy challenge to overcome. Nonetheless, good things should happen, now that the momentum has been generated. On my wish list is a powerful suction device that filters the entire air above highly polluted cities like Bombay, Calcutta, Mexico City, and others.
Looking forward to 2007, I would like to see Education and Poverty become two “sexy” trends, in the same vein as “Green” has become hot. The fact that Mohammad Yunus was awarded the Nobel Peace Prize this year, bodes well for the future of Micro-finance as a possible economic model to support entrepreneurship at the grassroots level, and elevate millions out of poverty.
And just for kicks, here’s 2005: Year of the Balance of Power