How to Succeed With an Online Service

There are new Web services being introduced every day but only a few succeed. What makes a successful service is still an illusive art for most people so therefore we will give you a glimpse of one of our tools we use to understand why a certain service becomes popular. First of all, the service needs to have a very high technological innovation height. This doesn’t mean that it has to be unique, just that it is at least as good as the current service. The second factor that is more important is that the solution has a very positive user experience. This means that the user gets value for his use of the service, eg. Google gives you very accurate searches and in a clean “straight to the point” environment. The final and far most important factor is marketing. If no one knows about you no one will use your service. Marketing could be everything from buzz to public relations. A crucial aspect if you truly want to succeed is to capture the attention of the media. If you play these three factors correctly your service will succeed 90% of the time.

3 Reason Why Google’s YouTube Investment Is a Smart One

After much discussion it finally happened. YouTube was snapped up by Google for 1.6 billion - a huge price tag but a very smart move. For you who follow our Blog you will be familiar that we always considered YouTube to be a smart investment.

The past weeks many people have come up and said that YouTube is the dumbest buy one could make mainly due to copyright laws but no one asked the question, what happens is those copyright claims are sorted out? How much is YouTube then worth? Is it still an interesting buy? Truly interesting questions, don’t you think?

We have been studying the Internet for many years and it is getting easier and easier to spot a good service or business. Therefore we will give you our three top reasons why Google made a good investment.

1. YouTube is the leading video site for recreation. If Google keeps developing the technology and the user experience – we have no doubt the will not do so – YouTube will keep its number one position for many years to come. When people today think of video they think YouTube, this is worth a great deal. When an Internet service gains such popularity in combination with the first mover advantage effect, dethroning the service is extremely hard if not impossible. This is also one of the main reasons why eBay bought Skype. Skype is the leading telecom service on the Internet although many competing services have been introduced lately.

2. Video and sound is the future of the Internet (will anything ever replace video?). You might think that almost everyone knows this but you will be surprised. Usually older people, in powerful positions do not understand this. Well they do not understand the Internet phenomenon and this drove the Internet bubble in the past and in the future. By possessing the number one site of video content on the Internet you secure your future and of course this will keep the Google stock up there.

3. Today’s advertising on the Internet is “old” and it will be forced to move into the future “Advertising 2.0”. The people behind YouTube have understood this and has collaborated some rather interesting advertising options for companies, where they involve the YouTube viewers with the advertising companies/brands. This gives Google a head start in the world of Advertising 2.0. The consequence is that even more money will run into Google’s treasury chest.

There you have it, of course there are other reasons one could think of, but this is our top three with regards to the future. Now depending on how Google want to cash in and how smart the people at YouTube are, they could cash rather quickly. So if you work at one of these companies listen up, we will give a tip where you can find the cash cow. Are you listening? Mobile services (3G) – the YouTube videos are great for mobile telecom operators that want to introduce services to their users. Can you imagine how many deals Google could make with mobile operators to offer a tailored service towards this market? Big money!

So what do you think?

Reward the Consumers

We have talked about it for a while, but now we start seeing it, how companies start rewarding the consumers. Metacafe is a site that competes with YouTube, and has started rewarding their customers depending how many views a video get. Metacafe starts paying when a video reaches 20000 views. See the full reward program. This a great buzz marketing but it signifies more importantly a shift in the increasingly competitive Internet market. As more and more services get online, services have to compete about the viewers time. This will inevitably lead to rewarding your customers for their contributions or spent time on your site. We think that companies that embrace this model quickly will enjoy the potential of buzz marketing and creating a more loyal customer base. Remember, your competitor is just a click away.

The following example has up to this date 386 000 views, which means $1000 in reward for the producer.

Saxo Cup Rally - video powered by Metacafe

Skype Founders Will Attack TV

There is a rumour going on that the Skype founders, Niclas Zennström and Janus Friis will create a P2P application form TV viewing. It sounds like an excellent idea, and a big threat to the TV companies. Without knowing anything further we think it might be the first true TV-on-demand application open for the whole world. What if you could come home and open your computer, and select exactly the show you want to see from anywhere around the world at any time? Wouldn’t that be nice?

We see how one business are after the other is attacked by the power of the Internet. Exactly how the business model for selling music was forced to change, the same will happen with TV and mobile telecommunication and many other industries. What do you think?

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