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The bottom line on Henry Blodget’s Business Insider

by Henry Copeland
Thursday, April 11th, 2013

Buried inside Ken Auletta’s recent New Yorker profile of Henry Blodget, there’s an ex-ray of the skeleton of Business Insider‘s P&L.

Six years on, the site projects $9.3 million in ad revenues for 2013. (Update: Henry B. wrote overnight that this figure was for 2012; I guess Auletta was interviewing Henry B in 2012, and their fabled fact checkers didn’t adjust the “this year” in Blodget’s quote.)

“That’s tiny. Ad rates are low. It’s tough to monetize,” says Blodget.

According to Comscore, BI has 9 million monthly US readers. (24 million global according to Google Analytics.) The rest of BI’s revenues (projected to total $11 million in 2013) come from conferences.

Anyone know how many editorial, sales and/or tech staff BI has these days? (Update: overnight Henry B. writes “~100.”)

Blogonomics, ten years on

by Henry Copeland
Monday, May 28th, 2012

Ten years ago today, I posted an essay titled “Blogonomics: making a living from blogging.” Peering into the future of media, I argued that traditional publishers would soon be defeated by hordes of ad-supported bloggers.

At the time, both claims — that a) traditional publishing was doomed by people-published content and b) that blogging would be lucrative — seemed ludicrous. Shares in The New York Times were just a couple of months shy of their all-time high, $52. Martin Nisenholtz, then managing NYTimes.com, spoke for most media insiders when he dismissed the “weblog phenomenon” as nothing “fundamentally new in the news media.” (more…)

East Coast agencies to watch — that aren’t based in New York, part 3: Atlanta

by Nick Faber
Friday, August 5th, 2011

Atlanta — “The Big Peach,” “Hotlanta,” “ATL” — is a straight shot down 85 from our headquarters in Carrboro, NC. It’s the home of multinational corporations like Coca-Cola, Turner, Delta, and UPS, and it’s one of the fastest growing cities in the South. So it’s no surprise that the “New York of the South” has so many great advertising agencies, pumping some of the best campaigns on the East Coast.

Today, in the final installment of our series, we look at the work of four Atlanta-based agencies that made it to iMedia’s East Coast Agencies to Watch list, and which are not headquartered in New York City. (Part 1 | Part 2)

IQ – US Department of Energy “Lose the Excuse”

IQ has a penchant for fun videos and kick-ass web sites. For the “Lost Your Excuse” campaign, the US Department of Energy got both. Along with partner-agency Goodby, Silverstein & Partners, IQ built a media-rich offbeat site that shows kids how easy it is to save energy. Check out Baron Davis’s hilarious cameo in the “Malcolm” video. Makes you wanna change your light bulbs, doesn’t he?

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East Coast agencies to watch — that aren’t based in New York, part 2

by Nick Faber
Wednesday, July 27th, 2011

We’ve dug into iMedia’s East Coast Agencies to Watch to find the best ad work outside of New York. In part 1, we looked at great campaigns from agencies in Washington, DC and Boston. Today, we avoid 95 altogether to check out two of New England’s top agencies.

Humongo (Danbury, CT) - ECKO UNLTD. “Indie for Life”

You may already know Humongo’s founder Darryl Ohrt for his industry blog brandflakesforbreakfast. Ecko turned to Darryl’s shop to get fans excited about its UNLTD watches this year. The campaign, “Indie for Life,” includes an incentive-heavy Facebook page with a series of live video interviews with indie entrepreneurs called ‘The Marc Ecko Time Chamber.’” The first interview is with “indie time-changer” Tony Hsieh, founder of Zappos.com.

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East Coast agencies to watch — that aren’t based in New York, part 1

by Nick Faber
Friday, July 22nd, 2011

In sports, they call it East Coast Bias. It’s the extra weight and attention teams on the East Coast get in sports coverage. But as east-coasters who aren’t in New York, we know that “East Coast” bias is really “New York bias.”

When iMedia released its list of 25 East Coast Agencies to Watch, nearly half of the honorees were in New York, and another quarter of them were based in the Midwest. So we thought it would nice to shed some light on the rest of the list, our fellow-east coasters who are working on some great stuff outside of the Big Apple.

In the first of three installments, we take 95 from Boston to DC, bypassing New York City on the way. OK, we cut through the Bronx.

Arnold Worldwide (Boston) – Jack Daniels “Independence”

This beautiful mini-doc is just one of four prongs of Arnold’s “Independence” campaign, which focuses on Jack Daniel’s independent spirt craftsmanship. In addition to this video is a TV spot called “As American As,” which likens Jack to many other great American innovations, a set of 10 original letterpress posters from Yee-Haw Industries, and a Facebook app that allows you to consume and share everything but the Whiskey itself.

As Dabitch sees it, this All-American campaign is all about love: “Forget the latest digital hype, some things are made with love the same way they were made so many years ago.” (more…)

Why Google+ will fail: social networks grow like trees, not on them

by Henry Copeland
Tuesday, July 5th, 2011

Having read many claims that ‘Google+ will kick Facebook’s ass,’ I’ll go out on a limb and predict that Google+ will fail miserably.

Or at least won’t dislodge Facebook anytime soon.

First, let’s stipulate that the Google+’s technology is cool and powerful. Former NYT tech journalist Jennifer 8 Lee says “Face­book should be scared.” Over at PC World, Mark Sullivan offers “9 Reasons to Switch from Facebook to Google+.” (Here’s a video intro to Google+ if you’re interested.)

News maven Jeff Jarvis enumerates the features he thinks will make Google+ an important journalistic tool.

Jason Calacanis, the entrepreneur behind WeblogsInc and Mahalo, argues that Google+ will take “half the market” for social networking from Facebook. “Google+ will compete with Facebook as effectively as Android is competing with the iPhone.”

To prove his point, Jason highlights a number of Google+ features that beat Facebook’s — features like “Forced categorization of contacts” and “Chrome Browser and Chrome Store integration” and “Android integration.”

And with more than 200 million deeply invested Gmail users, Google would seem to have a powerful launch pad.

So if Google+’s technology is brilliant, its userbase is deep, Facebook’s functionality is flawed and all the pundits are convinced Google will romp, why am I confident that Google+ will fail to beat Facebook?

Because in their Google worship and/or their focus on comparing features, the pundits are forgetting tried and true axioms about how humans adopt technology, axioms documented decades ago by tech visionaries like Gordon Moore and Clayton Christensen. Here’s my rundown.

1) Even the best carpenter can’t build a tree. Though Google+ is an elegant piece of engineering, it’s not a social network. Jason and Jeff love Google’s technical innovations. Sure, normal technology thrives because of technical brilliance, design beauty and marketing megatonnage. But social networks are affected only marginally by those factors.

Instead, in social networks, the users are the product. Users’ habits and passions and commitments to each other are the life-force that makes a social network grow. Just as you can’t build a tree from a bunch of boards, you never could have constructed Facebook or Twitter or eBay or LinkedIn or Wikipedia top-down with a bunch of prefab components. Launching with one hundred million users or a $100 million marketing budget would have more likely killed those sites, not grown them. (One advantage Google WILL have, at least initially, is fewer bimbots than Facebook.)

2) Wrong launch users. Passionate persistent users, not brilliant designers or programmers or professional commentators, build social networks. Google+ is launching with a diffuse cloud of alpha-tester geekerati who view Google+ as a feature set to be explored, tested and rated. Having the attention span and loyalty of fleas, this jittery crowd will migrate onward within weeks to the next hot-smelling technology that swaggers into view.

Beyond sharing a common identity as “early adopters,” members of this crowd don’t (usually) care deeply about each other or share a common passion beyond a burning desire be first in using a technology. They’re users, not community members.

Google’s diffuse-by-invites strategy works fine for a tool like Gmail, which is evaluated purely as a feature set, but it won’t work for Google+. Evidence: my friend Dan Gilmore, who as an innovator and former reporter for San Jose Mercury News should have more Google+ connections than anybody, went onto Facebook to look for friends who might also be using Google+. With no luck.

It doesn’t matter to you if 1 million or even 100 million people are using a social network, if only one of your 20 key colleagues and friends are using it. With social networks, it takes at least three to tango.

3) Diffuse launch path. Social networks can ONLY start small and tight with a set of enmeshed users, then percolate slowly outward. Facebook started in a Harvard dorm, then spread across Harvard, then to Stanford, Columbia and Yale. Then other Ivy League schools. Then colleges across the US. Then high schools. Then Microsoft and Apple. Only then, 30 months after launch, was Facebook opened up to everyone.

Likewise, Twitter started with messages between Biz Stone, Ev Williams and Jack Dorsey and their friends in San Francisco in March of 2003. It percolated there for a year, before expanding in March of 2007 into the tightly networked SXSW crowd, folks who were hungery for a way to recreate and sustain their SXSW friendships when they left Austin. That crowd, in turn, evangelized to their social network savvy friends at businesses across the US.

For both Facebook and Twitter, initial users were tightly networked. There was a strong sense of clubbiness among community members through a long initial phase. Those members’ loyalty to the club withstood even repeated outages (on the part of Twitter) and privacy concerns (on the part of Facebook) that would have doomed a normal technology product.

4) Noisy feedback loops. One of the key reasons that launching big is fatal to social networks is because the feedback loop from users to designers to users to progammers to management to newbs to old-timers to programmers gets cluttered with noise. When a tool launches big, its designers end up trying to build a feature set that satisfies all communities — or their own peculiar whims. Most users end up with a luke-warm affection for the service. There’s no ‘sponsor’ community to advocate change or evangelize.

MIT professor Eric Von Hippel has amply documented the importance of users in driving innovation in technology domains as diverse as thermoplastics, semi-conductors and scientific instruments. Is there any doubt that user innovation would be even more crucial in shaping social networks, where the user and the product are so closely entwined, functioning as two ends of the same biocyber synapse?

Rather than launching big and broad, far better to build a “small” tool for one passionate community. Once the kinks get worked out, this template of technology and usage patterns later gets adopted/adapted by other adjacent communities. Using this approach, people like to feel they’re in a human-sized space in which their actions matter, in which their feedback into the system gets processed and used. (Gordon Moore’s book Crossing the Chasm is awesome about this process.)

(It’s worth noting that Robert Scoble thinks Google+ is just for geeks and will survive by serving that market alone. I think geeks don’t just want to socialize with geeks… for long.)

5) Professional managers. Successful social networks evolve over time, often blossoming out of series of random, non-linear, unpredictable connections and chemistry. In retrospect, the winner’s strategy looks obvious (read Duncan Watts’ book!), but at any given moment, it is impossible to determine what feature set or user base will drive the coming decade’s NEXT dominant social network.

Professional managers, particularly of software projects, can’t tolerate this kind of nonlinear growth. In his post about Google+, Jason notes that he wrongly predicted huge success for Wave, Google’s previous attempt at social software launched with great fanfare two years ago, because Google ultimately stopped devoting resources to Wave. Why should things be different this time? Google is a big public company that needs high-profile successes not meandering muddles that may eventually pay off. This means Google will likely give up on Google+ before it can take root, just like it killed Wave. Clayton Christensen’s brillian book Innovator’s Dilemma gives the playbook.

6) No culture. Starting big and broad also kills the chance for a social network to develop a distinctive culture. This is crucial because a great social network is known by its culture, its lingo, its behaviors, its taboos, its history. Some examples:

Overwhelmed by the volume of information flowing from Twitter, Tweeters (not Twitter) created hashtags to keep track of ideas.

Back in 2004, the liberal blog DailyKos was playing a key role in narrating and steering the Democratic party’s primaries. The site was getting lots of favorable press, and I asked Markos Moulitsas, the community’s creator and curator, whether this attention was having a big positive impact on the community. On the contrary, Markos replied. Every time there was big press about the site, the community would flood with new users who didn’t get the site’s culture. Traffic would spike briefly, but interaction quality would plummet. A big gush of new members busted the site’s chemistry. Then DailyKos would shrink back to its previuos size and start growing organically again. Since then, the Kos community’s richness has spawned its own yearly convention.

(Another example of Kossite culture: to this day, a novel ad campaign can’t run on DailyKos without invoking communal cries of “pie fight,” an insider reference to an infamous, bodacious 2005 ad campaign by Turner Broadcast for a Gilligan’s Island reality show.)

For another example of how growth can kill a social network’s culture, look no further than the Q&A community Quora‘s explosion/implosion early this year. Once a steadily growing service, rich with VC and tech insiders, Quora suddenly went viral in January. New users flooded into the service and quality of interactions plummeted. Despite lots of agonizing over how to sustain the growth, http://quorareview.com/2011/01/27/evolving-quoras-design-for-growth/ the site has fallen back to earth.

In contrast, the Q&A service Stackoverflow, which is tightly focused on serving specific communities and growing organically for the last three years , has overtaken Quora. Notice in the Google trends graph for the two services that Quora has gotten a huge amount of press (bottom trend box), but Stackoverflow is now far bigger.

Am I a Luddite or Google-hater? Judge for yourself. I started tweeting in March of ’07. I was LinkedIn’s 4,154th user. I even own a few Google shares — their ad business is a money-printing machine.

Summing up: Google’s great at carpentry. Gardening, not so much.


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