Guillaume’s blog

A few days ago, I bought The Future of Reputation book from Daniel Solove. I had already downloaded it for free in PDF on my computer but bought it nonetheless for $9.99 on Amazon.com

The reason, according to Kevin Kelly most excellent article Better than Free: embodiment. Embodying the book in the form of a lightweight, low-power long-lasting reading device is something I value more than the content itself.

Kevin lists 8 other qualities that makes something better than its free counterpart, and although I list them below I encourage you to read the entire article:

• Immediacy
• Personalization
• Interpretation
• Authenticity
• Accessibility
• Embodiment
• Patronage
• Findability

I was encouraged this WE to look into the cost-per-click of some financial services keywords in the U.S. using Google Adwords Keyword Tool.

As of the time of this writing:

• “video cameras” costs you an estimated $3.14 per click,
• “buy car” costs you $4.81,
• “wireless” and related: ~$5.00,
• “dsl” and related: ~$6.00
• “real estate investments”: $5.47
• “buy computer”: ~$8.

Now get this:

• “buying mutual funds”: $12.66, “online stock trading: $18.06
•  ”best credit card deals”: $25.94, “balance transfer credit cards”, $18.23
• “auto insurance quotes”: $34.58, “insurance quotes: “$29.77″
• “high yield checking account”: $17.81, “checking account rates”: $20.44
• “mortgage refinancing”: $32.58, “home equity loans: $23.74

I know this is a very superficial research study, but there seems to be a pattern here: financial services firms are paying significantly higher than firms from consumer sectors for prospective customers’ attention.

What can we learn from it? IMO the cost per click is a function of

• profitability of the related service offered over the average customer relationship duration, and
• likelihood that the prospective customer who has clicked will subsequently actually buy the service online,

then my quick conclusion is that there is probably good business opportunities in online comparison services for financial services products, as well as in new financial services that leverage the Web and social networks to be cheaper and mass-market. Peer to peer lending is probably one of them.

How do you let Apple know that you want the next release of the Mini to include a Blu Ray player and how much you’d be ready to pay for it?

What about an online store that includes some of the many product concepts designed by Apple fans such as the MacCube concept below? or a product configurator of existing products that includes features not yet available from the manufacturer but that exist as technologies or as third-party add-ons?

Seems like something identified by the VRM promoters.

Only problem: would Apple care?

Having both a background in the business and engineering of software, a topic of particular interest to me is the archetype or pattern of successful Web businesses. By “business platform”, I mean the software that powers a business and what I want to talk about is what the business platform typically does at highly successful Web businesses.

Archetypes or patterns are not synonymous with recipes. Knowing the typical structure of a symphony does not make you a composer, or in the present case, knowing the archetypal business platform does not make you a billionaire. They do nonetheless help you in thinking and exchanging ideas about particular instances.

Ok, I won’t make you salivate longer. Here’s my attempt at formulating the archetypal business platform on the Web:

“Web companies make it easy for people to post information on the Web in a format that makes it easy for other interested people to discover, search and browse what is relevant to them, but more importantly in a way that they retain control over who gets to see the information and how. All that of course, 24/7, real-time and globally.”.

Let’s take a few examples:

• YouTube made it easy for people to post videos on the Web in a format that makes it easy for other interested people to discover, search and browse what is relevant to them, but more importantly in a way that they can add commercials to the videos being watched.
• Facebook made it easy for people to post status, pictures, messages, review, etc. in a format that makes it easy for other people to discover, search and browse those that are relevant to them (their friends’), but more importantly in a way that they can track who is interested in what and add relevant “social ads” next to the information they consume.
• Amazon started as an online bookstore, but is quickly evolving into making it easy for book writers, audio book producers and possibly in the near future vendors of other types of digital or potentially digital goods to publish their work on the Web, in a way that makes it easy for other interested people to discover, search and browse (Kindle), and buy, but more importantly in a way that they can take a commission on the resulting purchase transaction.
• Apple started as a hardware vendor, but it has quickly become a company involved in making easy and safe for music and movies producers (soon game producers) to market their digital goods online in a way that other people can easily listen to or watch (iPod, AppleTV, etc.), but more importantly in a way that they can take a commission on the resulting purchase transaction (iTunes).
• etc.

Ok, I am assuming that by now I’ve convinced you, or that I got the benefit of the doubt, or at least that I formulated correctly something that has long been obvious for you (and that you can now share easily). If not, I’m happy to learn about your viewpoint and discuss.

What is now interesting to think about, is how we can take this simple tool in thinking about the future of business on the Web. I think we can make a few easy predictions:

• Autonomous publishing software/hardware that publish information about you on their own are quite exciting, as enablers of new businesses. Example includes your location as detected by your cell phone provider, temperature/humidity data loggers (ex. temperature, humidity) used to complement existing weather sytems, 2-way navigation systems used for real-time traffic data sharing, camera that directly push pictures on the Web, etc. I think we will see more of these autonomous data publishers.
• Publishing tools that will make it easier for people to write content in a format that can be indexed, searched, browsed by others. Here, we may finally start to move away from the online form and start to see semantic extraction technologies or semantic content editors that add unambiguous meaning (microformats in the case of text) to your content as you create it.
• Consumption interfaces that will make it easier and entertaining for people to express what they are looking for in a way that a software can understand and find relevant items from an ever growing and diverse collection of digital goods.
• Consumption devices that will provide the best way possible to experience a content in a given environment. That would include screen walls for digital painting, 3D printers, etc.

(Please use the comment form to submit your ideas)

Of course, last, we will see more and more of companies trying to own the whole chain on a particular type of digital good or a particular community of people, via acquisitions or partnerships. And to mirror this, more and more communities that will try to prevent companies from doing so too much and/or for too long.

Again, this archetype is not a recipe for success. In my view, the most significant pattern of success but also the most difficult to craft is community. Another one is legal innovation. More on both, hopefully, later.