Tag Archives: Business model

March 9, 2016 · 10:10 am

Blocking My Goodwill

One of the things I’ve done consistently throughout my life is to subscribe to the NY Times. I can remember a representative of the paper coming to my elementary school class to show us how to fold it for easy reading and to explain how newspapers are written and printed. 50 years later, I’m still a reader.

The New York Times uses an unusually large hea...

(Photo credit: Wikipedia)

You might have read that the NY Times is following the lead of several other publications and shutting down access to those people who use ad blockers. Instead, readers who visit the Times site will see, as Digiday reported, the following:

“The best things in life aren’t free,” the pop-up reads.”You currently have an ad blocker installed. Advertising helps us fund our journalism,” then points readers to two options: purchasing a subscription option, which doesn’t strip the site of ads, or to whitelist the Times, which disables the ad blocker.

It’s the value exchange – we give you content, you give us attention. I’ve written about this paradigm before and I came to the conclusion that there really isn’t any one correct answer for publishers when it comes to ad blockers. Cutting off access does little for most publishers since not many publishers can claim to provide truly unique and valuable content and readers can go elsewhere. The Times, however, can make that claim. The issue is that with upwards of 40% of US readers using some sort of ad blocking, curtailing access also means fewer page views that can be sold, lower time one site, higher bounce rates, etc. Still, given their success in digital, I’ll give them a “wait and see” on this. Except for one thing: They’re cutting off access for subscribers as well.  As a spokesperson put it:

Ad blockers do not serve the long-term interest of consumers. The creation of quality news content is expensive and digital advertising is one way that The New York Times and other high-quality news providers fund news gathering operations.

Want to know what really doesn’t serve consumers’ long-term interests?  Greed. My bill for home delivery, which includes online access, is around $150 a month.  I daresay that the Times has gotten full value out of me, just as I’ve gotten great value out of their content. I access the Times site as a logged in user, so it really shouldn’t be too difficult to identify me as a subscriber and not to hassle me about ad blocking.  Hopefully, they will.

To the extent it can, any business needs to treat each customer as an individual.  There are very few rules that can apply to prospects and customers equally, and not every customer is the same (the pesky lifetime value computation we need to do!). Asking a customer to pay for access and then asking that same customer to endure a barrage of ads as a condition for continued access seems like nothing more than greed and insensitivity.  What do you think?

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January 26, 2016 · 11:30 am

Ends And Means

The cynics among you believe that as a brand or as a company behavior matters far less than a low price and a quality product. If you provide a great service or a good product and price it as low as possible, consumers will buy. It doesn’t matter if you pollute the air or pay lousy wages. Consumers just want to know what’s in it for them. The good news, from my perspective, is that you are wrong. Here is the evidence to back it up.

The Havas folks did a study to understand how corporate social responsibility has evolved over the past decade. They looked at how are companies responding to consumer pressures to work toward the common good and what those consumers now expect from their brand partners. Most importantly, the studied how critical these expectations are to their purchase decisions.

As it turns out, consumers are extremely interested in this. Half of mainstream consumers and two-thirds of Prosumers (a term coined by futurist Alvin Toffler – a consumer who produces and consumes media – and who doesn’t?) avoid buying from businesses deemed to have a negative social or environmental impact. As the study states: “People still want bargains, of course, but it’s even more essential that products and services offer some sort of enduring value.”

Some other points from the study:

  • When we asked respondents how important it is for a company’s CEO to do certain things, paying workers a fair wage and providing a pleasant work environment received higher scores than earning profits or even being environmentally conscious.
  • People aren’t looking for businesses to act as quasi-governments. On the contrary, around two-thirds of our global sample actually fear the power big corporations already wield. What they want to see are all the world’s players—governments, corporations, NGOs, citizens—working together to tackle problems that no single entity can solve alone.
  • Two-thirds of our global sample agreed that businesses actually bear as much responsibility as governments for driving positive social change, and 62 percent said they’d like their favorite brands to play a bigger role in solving social problems.

The point is that if you believe that your brand or company can let the ends – revenues and profits – justify any means, you’re sadly mistaken.  The study shows that companies that do good are more likely to do well.  Isn’t that the end we’re all after?

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December 23, 2015 · 10:57 am

Defensibility

I was on a call yesterday with a potential client and we were discussing his product. What he has done is to take a number of off the shelf products and integrate them into something really innovative and wonderful. At one point he expressed to me a bit of trepidation with respect to that. In theory, anyone could take those same components and build something similar, although it certainly would take them some time. In a word, he was concerned about defensibility.  

I told him that I was less concerned than he was about it. I likened him to a great chef. The magic is partially in the great ingredients for sure, but the real magic happens in how those ingredients are combined. His goal in building his dish isn’t to make something that is defensible but rather something that delights his customers, is really unique, and that can continue to evolve over time based on feedback.

Instead of focusing on patents to make something defensible, my feeling is that time and money are better spent on drilling down on why a customer will want to choose your product and only your product as a solution to their problem. Remember that the first question you need to ask is “what problem am I solving?” If you are unclear about that, no patent will protect you from failure.

How defensible is Facebook? It really wouldn’t be very hard to do what they’re doing, or at least it wouldn’t have been 10 years ago. Their biggest defense now is simply scale. We join social networks because our friends are there, and migrating everyone we care about to another platform when the one we’re on satisfies our needs is difficult. The newer platforms such as Periscope and Snapchat are solving a different problem which is why they are scaling too.

Many people do what I do. There are tons of consultants and even more bloggers. I like to think that what my clients and my readers get from me can’t be duplicated since my life experience, intelligence, and creativity are mine alone. I’m sure each of them feel the same way about themselves. My blog and my business are defensible because I use those raw materials to solve problems in a unique way. Do you?

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