Handipoints Launches

Viva Chu, a colleague at my last startup, has finally launched Handipoints, his chore tracker/virtual world for kids. He also snagged a nice review in TechCrunch.

Handipoints is a site where parents can create printable chore charts and setup an allowance program that is tied to teaching responsible habits. Kids earn points from doing their chores, homework, and staying healthy. They use their points to buy rewards from their parents or to play games, watch cartoons, and adopt and dress up a cartoon cat in HandiLand.

Congrats, Viva, I look forward to trying it out with my kids.

And then We'll Teach the Saudis How to Farm

While the rest of us are trying to figure out how to make internet brand ads ($5 CPMs, if you're lucky) as engaging as TV ads ($50 CPMs), TechCrunch is trying to figure out how to bring internet style ads to TV.

I'm sort of at a loss for words on this one.

'Pimp' is an Uglier Word

Henrik Torstensson points out an article on BubbleGeneration called Companies Are Not Pimps. Their beef? LBS was holding a conference called Monetizing Social Networks.

Here's BubbleGeneration's take:

MBAs come to B-school wanting to do cool things - and they get crushed into thinking business is about "product" and "monetization"... It was, at least a little bit - in the industrial era... But that was yesterday... If there's one single lesson you apply at the edge, let it be this: business models happen... What that really means is: we don't "monetize" resources. We co-create and co-produce value... Monetize is an ugly word.

Well, this is just dumb. Okay, monetize is an ugly word, in the sense that it means turn into money. You don't want to turn your users into money, Mr. Midas, you want them to compensate you for the value you are providing to them. There is nothing wrong with this. In fact, it seems sort of fair.

So: (1) create value, (2) get your customers to pay you. [Furiously trying not to bring up South Park Gnomes... failed.]

It's amazing the value you can create if you don't need to make any money. But unless you're going to set up as a non-profit and get kind-hearted people to give you cash, you probably can't create value for very long. While I believe people who are willing to create tons of value and not get paid for it are the secular equivalents of saints, I doubt that's what BubbleGeneration meant.

Creating value is not enough. As the Economist notes,

A great paradox of the internet... is that a next big thing—web-mail then, social networking now—can indeed quickly become something that consumers expect from their favourite web portal. The non sequitur is to assume that the new service will be a revenue-generating business in its own right... Web-mail has certainly not become a business... Social networking appears to be similar.

Webmail and social networks create a ton of value. While it may be too soon to tell with social networks, webmail has certainly proved to not be especially "monetizable." But, so what? It makes a little money, it's incredibly useful, it's great. But it shows that you can't map value to money. The belief that value and money are inherently interchangeable is one of the great lies of our capitalist society.

I don't believe that companies should be started with making money foremost in mind. They should be started with some way of solving a problem, making peoples' lives better, resolving an inefficiency: some way of creating value. But after deciding to make the world a better place, the next question company founders need to ask themselves is "how will we make enough money to pay our developers, pay for our overhead, and provide a decent return to our investors for being foolish enough to believe in us?"

If you're not creating value, well then you shouldn't be in business. But if you don't intend to monetize then what you're doing wasn't a business in the first place.

The Feed Kludge

I'm not a huge fan of blog comments. Sure, I appreciate the friendly "Amen, brother", but if you've really got something to say then start your own blog and start saying it. And, of course, link it to my blog. Comments are inherently a speaker-audience metaphor: the blogger is up on the stage talking and the peanut gallery chimes in now and again. I don't like that; I don't want an audience, I want an invisible college.

A network of citations is the best way to organize and discover relevant information, better even than the oft-yearned-for semantic web. From a systems point of view, writing a blog post and linking to mine creates a useful connection. It says that your set of ideas and my set of ideas are related. It means that highly connected subsets of the web could be mechanically discovered; that someday I could ask to read opinions on, say, the Future of Advertising, and some system could reliably set me up with feeds of sites that talk about that. And it could do it in a way that more closely emulates the editorial function than the search function. And the editorial function is what is sorely missing in today's web. That's why I often spend half an hour weeding out the direct marketing pitches from the useful content after a Google search: what are my other options? Go to About.com? Not likely.

Sarah Perez writes that the Conversation Has Left the Blogosphere over at ReadWriteWeb. The article is a list of kludgey ways to track ideas and comments popping up in unlinked settings: Twitter posts, Digg comments, Facebook feeds. The bigger issue for me is that these new sources of ideas aren't integrated. One strength of the web, linking, is being superseded by another, ease of communication.

Maybe I'm just an optimist, but there has to be a way to create more communication while maintaining some way to keep the information organized. I'm not saying we should roll back progress, I would never say that. The internet community has always been great at synthesizing great features into true progress. That is definitely what's needed here.

Don't Do Me Any Favors

Louise Story had a decent article in the NY Times on Monday about internet ad targeting. But the article, like every article on ad targeting ever written in a publication dependent on placating their obviously non-objective sources, said this:

...executives from the largest Web companies say ... the data is a boon to consumers, because it makes the ads they see more relevant... “What is targeting in the long term?” said Michael Galgon, Microsoft’s chief advertising strategist. “You’re getting content about things and messaging about things that are spot-on to who you are.”

Now, let's keep this between us internet marketing wonks, but the truth is targeting isn't a boon to consumers. We're not doing them any favors. Moreover, nobody I know who is in the marketing industry (as opposed to the media or ad-tech industry) says that consumers want advertising. Consumers put up with advertising, because they know they can't get content without it.

Don't agree? Here's a simple test. If you're doing the consumers such a favor with targeting, ask them to give you something back for it. Money, maybe. Or maybe just putting up with inferior content. That seems fair, doesn't it? Convince me that consumers are willing to give up something for more relevant ads, or stop saying it.

The only thing consumers give up to see more relevant ads is their personal data, and while that data's very valuable, they are giving it up only because they don't know they are.

David Verklin, of Carat, in the same article:

"Everyone feels that if we can get more data, we could put ads in front of people who are interested in them,” he said. “That’s the whole idea here: put dog food ads in front of people who have dogs."

Note that by "everyone" he means everyone in the marketing, media and technology world. He is paid to sell more dog food, and targeting lets him do that. If a salesman showed up in my office and said he came calling because I fit the profile of buyers of his product, I would say he's just doing his job; if he claimed, in addition, that he was actually doing me a favor by not showing up trying to sell me something I didn't want, I would think he was an idiot. Verklin does not claim to be doing anyone any favors, he claims to be doing his job. That is how marketing professionals think, and how the better ones admit to thinking.

I make my living in the marketing industry. I'm not going to bite the hand that feeds me. But the idea that we're doing consumers a favor is so transparently ludicrous that it sounds exactly like intentional misdirection or defensive rationalization.

Please, everybody, stop saying targeting is a boon to consumers. Seeing ads are the price consumers pay for media. Anyone arguing that slightly lowering that cost by showing more relevant ads (without acknowledging that they are increasing the costs by nosing around in the consumers' private affairs) is not doing anyone any favors, especially not the marketing industry.

A Dollar's Worth of Wine, and Three Dollars' Worth of Bubbles

I had this New Yorker cartoon on my desk in 2002. I felt for that guy. Wait, I was that guy.

I totally missed out on the real estate bubble. Well, I bought a house in 2003, so I guess I played a bit role. Eric Janszen has a great article in Harper's about the dot com bubble and the real estate bubble. While I disagree with about half of what he says, that's a pretty good percentage for me, so I recommend reading it.

He makes a case that the next bubble is starting to inflate now. He also lays out the timing and size of the next bubble by looking at the characteristics of past bubbles. It's a bit simplistic, but it's fun reading. If he's right, then knowing what the next bubble is, investing in it now and selling anywhere near the future peak he has identified would be a nice way to get rich without needing to be a super-genius, a hard worker or anything other than a huge risk-taker (and, of course, somewhat wealthy already.)

So, what's the next bubble? He thinks alternative energy. That doesn't seem right to me: creating that type of company requires actual deep technical expertise-- unlike creating a dot com or buying a house--so I don't see how enough investable companies are created. Any other ideas?

All I know is, I'm going way short in 2013.

Shoemaker's Child

I should be using this blog as a marketing vehicle, not for the money, but for the learning.

This company, YouCast, is doing something pretty interesting around branding on the internet. Can't say too much, but this Snapple widget is part of it.