Slade Sherman
Slade Sherman’s Blog on Marketing and Small Business
Foursquare vs. Groupon
When I speak to people about what I do most people usually ask me about Groupon and Foursquare. Both have been in the tech news lately with Groupons’ amazing $1 Billion valuation and Foursquare’s reported $95 Million valuation. So here are my views on both and why I prefer the Foursquare model:
Groupon:
Groupon bands thousands of users together to get bulk discount deals from local businesses in various cities. They have managed the most successful execution of this strategy to date and have become profitable by taking a cut from each business that offers goods or services on the site. The ability for Groupon is to tap into the concept of ‘collective buying power’ is very valuable and makes Groupon a great company.
While Groupon are very good at using social media tools to build their database, they are not a social network and their growth is limited by a number of factors. Firstly, there are reportedly over 150 competitors to Groupon and copying the model is as easy as putting on sales people in a city and developing the software (I have heard of developers quoting under $5000). Secondly, because there is only one deal per day per city, the deal is based more on what offer the advertiser of the day has and this doesn’t necessarily apply to ‘me’. Finally, as a web business their network growth is tied to theiractivity and the principle of Metcalfe’s law does not apply. So in my opinion their long term value is limited by these factors of ease of competition, relevance and limited exponential growth opportunity.
Fourqsuare:
Foursquare is a location-based game and social networking website for mobile devices. Users “check-in” at venues on their mobile handset and they are then awarded points and sometimes “badges” for their activity. The company has received much attention because marketing campaigns with popular brands like Starbucks that allow for special offers and coupons to be promoted to users. In addition to benefits like checkin validation, in-store redemption, businesses can view stats on visitors and get detailed breakdown of their activity.
When compared with Groupon I believe that as a social network, Foursquare have a much brighter future. Their value is in the database of “check-in” activity and the ability potential advertisers will have to target promotions based on this activity. Like Facebook they do face issues around privacy and the use of this information, but the ability to promote time sensitive special deals liked to location is highly valuable provided deals are relevant to the user. When assessing long-term business value, (1) it’s difficult to copy Foursquare as their value is in the network and the “check-in” activity, (2) because of the volumes of data being collected, the promotions in Foursquare will have greater user relevance and (3) as a social network there is much greater opportunity for exponential growth of their network.
One limitation of Foursquare is the low average age of its’ users. As a consumer in my 30s i can think of many of my peers who “check-in” and use their service but with over a million checkins each day I’m sure that they are happy with their niche in the market.
Where’s the Loyalty?
What a week in Australian politics…
Who could have imagined 2.5 years ago that Kevin Rudd would not be contesting the next federal election? And well done to Julia Gillard who is now our first female Australian Prime Minister. More »
How Alice.com Used Social Media Marketing to Generate Traffic
I really enjoyed the talk by Rebecca Thorman at Alice.com at Web2.0 Expo.
Six months prior to the Alice.com launch they started using social media, company blogs, Twitter, Facebook, and YouTube to connect with a list of key influencers.
Lead by Rebecca Thorman, the company developed a community of loyalists by targetting mom and frugal bloggers who provided input during the pre-launch phase and then on launch brought attention and grassroots credibility to the service.
The Alice team also offered incentives like discounts and coupons to select bloggers, so they could extend incentives to their readers to try the service.
In the first week after launch, Alice received 110 pieces of unique coverage and nearly 70,000 tweets. In early June, the pre-launch Alice.com site had 170,000 site visits — before anyone could even use the service. At launch time in July, Alice.com’s traffic jumped to nearly 400,000 site visits.
All pretty amazing when you consider that Alice does not invest in advertising — this was all grassroots Social Media Marketing.
So here are are some tips from Rebecca.
On approaching bloggers:
- Establish a list of the key influencers for your service or products. Ideally they should be the leading bloggers in your industry with lots of followers and influence.
- Start commenting on their blogs making sure your comments are not just a ‘plug’ for your services. Make a positive contribution and don’t spam.
- After a couple of months of following, contributing and adding value, approach the blogger. It is much more likely that they will know you and have time for you.
- Make sure you have something interesting to show them.
On Facebook vs. Twitter:
- Alice found Twitter much more effective in reaching the blogging community and this was used more prior to launch.
- Following launch, their Facebook page attracted much more activity because because of the broad consumer appeal of Facebook.
Five Lessons from Web2.0 Expo in San Francisco
Back at Web2.0 Expo in San Fran. The week has been excellent with a great group of speakers.
Five lessons from Web2.0 land:
- Get your product out there; the common message from presenters is that it’s better to launch your website and get user feedback even if you feel your app isn’t perfect.
- Location location; the launch of the iPad and many new mobile computing devices is opening up a host of new location-based services. Knowing what you do and where and when you do it, presents new and exciting opportunities around behaviorally targeted advertising. The most important part is ensuring buy in from the consumer.
- Embrace Open API’s; Saw a great talk by Sam Ramji discussing the importance of having API’s to allow your services or brand to be sold through other websites. In his talk Sam talks about how retail outlets like Nike, The North Face and Maytag grew their businesses by allowing other successful retailers to sell their products. He then draws parallels to how an effective Open API strategy can have the same results for emerging Web2.0 sites.
- Effectiveness of Social Media marketing; I saw a talk by Alice.com on how they used social media and blogging to generate enormous traffic in the lead-up to their launch. A good example of companies now using grassroots social media marketing to build a brand.
- Have a great product and deliver value; all the most popular applications offer real value over incumbent solutions. The simplest rule in business still applies.
Why I love the iPad
So what’s so good about the iPad? I mean who’s going to replace their books with this fancy electronic device anyway?
I think people that are focused on ‘books’ miss the point and this is why:
- The iPad is not an electronic book,
- It’s not a photo album.
- It’s not a device for reading newspapers or magazines.
- It’s not a video or YouTube viewer.
- The iPad is not a games console.
- and it’s not a music player.
- And the iPad it’s not a presenting device.
The iPad is not any one of these things, it is ALL these things and more! OK, so you have probably guessed that I’m sold on the device and can’t wait to get my hands on one as soon as they come to Australia.
I am also very impressed with the convenience of the App Store. Like with the iPhone, iPad users can purchase apps and content with the tap of the finger and it’s easy because the App Store already has your credit card details. The simplicity and convenience removes roadblocks and lost sales usually caused by those ‘need to get my credit card’ moments.
The Mac strategy is about so much more than books. This video also has another use for the iPad but I should warn you that it was difficult for me to watch.
My New Website: Myzerr.com
Last week was the Apple iPad launch and today is my turn! I am very excited to advise that the Myzerr.com beta site is now live and would like to invite you to register here.
So what is Myzerr?
Quite simply, this: Myzerr is a virtual meeting place, an online platform that connects communities and users with each other and with businesses using a social object – coupons, in this instance, or what we call ‘Zerrs.’ There are three aspects to Myzerr: individuals, communities of which they are members, and businesses of which the individuals and indeed the communities are, or could be, customers. So Myzerr is where all three can cooperate for the good of each. More…
Free Promotion For Business:
You can promote your business and it’s FREE so please sign in and add your business today. More…
Discounts for Community Groups:
Myzerr allows you to setup a page for your group and then invite businesses to give your group members ‘member only’ discounts. Setup a community discount program for your group today and it’s FREE. More…
If you notice any problems, please tell us. If you think it’s awesome, tell others and forward this email to all your friends!
Best regards,
Slade
For updates please follow Myzerr on Twitter.
7 Important SEO Factors
There are many elements that influence search results and your on page SEO and I have come up with a list of seven of the important search factors for any business interested in enhancing their website for search:
- The most important factor is good quality content. Make sure that what you write is new and original.
- Do some keyword research. A great tool is Market Samurai but if you don’t have the time engage an SEO expert.
- Use H1 and H2 tags for headers and sub-headers
- Alt or image tags on website pages.
- Have a custom 404 Page error page that will help users navigate your site and ensure you don’t lose traffic. Here are some great 404 page examples.
- Use social networking links, feeds and email.
- Include title tags, meta descriptions and keyword tags on all pages.
Many of the elements require coding changes so it’s a good idea to pass this list onto your developer as part of your site maintenance or redevelopment.
Seth’s E-Book
I love Seth’s blog and an entry this week includes a free e-book that is a good read for any aspiring web entrepeneur.
Not much more to add…just have a read!
Web2.0 vs Web 3.0 and The App Economy
Earlier today I came across a talk by the Marc Pincus from Zynga at this years Web2.0 Summit. If you have 10 minutes it is well worthwhile taking a look.
In the presentation Mark highlights the movement from Web1.0, with links and banner ads being the path to revenue, to Web2.0 with currency and monitization coming from SEO, SEM and Google Ad Sense and Ad Words. He goes on to describe new Web3.0 Third business plan of the internet that is generating revenue from the “app economy”.
In this app ecomony, Mark talks about how sellers of the future will increasingly use social media and friends/network sharing for sales of product and become less reliant on Google ad clicks. I believe that we are only seeing the tip of the iceberg both in relation to Google type advertising and social media generated sales and that the market for both approaches is still in it’s infancy.
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- Foursquare vs. Groupon
- Where’s the Loyalty?
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- My New Website: Myzerr.com
- 7 Important SEO Factors
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