Category Archives: The Long Tail

the long tail is a increasingly used term to define the de-centralisation focus around a few to the many.

Keeping it Simple

There seems to be quite a flurry of good business ideas being directed towards me in the past few days. One thing they ALL have in common is exponential growth. This is not exponential growth in customers, but in the size of the idea.

One sentence that I find myself regularly repeating is “There are 6 billion people on this planet. You do not need to appeal to ALL of them”

Yes, if you have a great idea, people WILL get excited about it, they will tell you how it applies in many situations and how much an extra feature would help them.

But while your idea is growing ever bigger, your prospects of success are shrinking just as quickly. Rowan’s diagram explains this phenomenon nicely:

Rowan’s diagram

There are MANY downsides to having 6 Billion people on this planet. One of the few upsides is that you can have a super focused, simple and targeted product that 99.9999% of people have absolutely no use for, and your target market will still be multi-thousands or millions of people.

I know it’s scary and adding new target audiences feels intuitively like a safe way to play it, but the reality of the situation is that the more you DILUTE your idea and spread the appeal, the less that your main and most profitable market will like it.

When you have that target market eating out of the palm of your hand, that is the time to start looking at how to attract a different group of people. If you are unsure of whether your idea is enough to get your initial group knocking down your door, then maybe it is the idea and not the size of the market that needs analysis…?

Webstock Mini – Life on the Fringe

The Decisive Flow team headed along to the Webstock mini conference on Tuesday night.

Apart from now knowing more about tag clouds than we ever thought we would, we also learned about living on the fringe. And the fringe is an exceptional place.

I loved the quote “We didn’t think we’d make any money off it, and we didn’t think it would last”

What a brilliant way to form an idea or start a company. I’m not being sarcastic. To do something purely for the love of it. How could you not be successful? Despite the fact Wellington is so small everyone is like your next door neighbor, the world is quite large, large enough for other people to share your passion and buy your stuff.

People who live on the fringe don’t start something for the sake of the ability to call themselves an ‘entrepreneur’. In fact I don’t even think they would consider themselves entrepreneurs.

People on the fringe don’t care about success. Success to them is living the life we all dream of.

People on the fringe, it seems, very quickly get off the fringe, upon achieving traditional success (Bill Gates was a fringe dweller, now his company is a fringe blocker)… Unless they are a special type of person who was born to decline adoration in favor of a good time.

People on the fringe probably can’t smoothly get their ideas across and charm investors (Which I DO believe was the point of the CodeBlacks team in the Half baked Challenge), but they prove that slick presentations mean nothing in comparison to just going out there and doing it.

Despite what the speaker said (and I’m sorry, I’ve completely forgotten his name, I’m terrible with names), I don’t believe companies CAN harness the fringe. It’s like when people catch hackers and try to train them up to work for the ‘good guys’. You gotta numb the fringe and tame the beast before they can work in your world. And when you have done that, they are no longer what you are after.

What I love about the people on the fringe is that you probably will never pick them. They wont be at the very events we go to to figure them out, they don’t talk up a storm about their achievements – they don’t even look at their achievements as achievements, just something they love to do. I think that’s what I found funny in the speech, the very concept of this type of person flies in the face of coming up with any strategy to harness their power. We know they are there, but no one can do anything about it. That must freak out the big guys.

My predictions for 2008

I was at the business center last night for a relaxed wind up to the year. Melissa Clarke-Reynolds (founder of Pay Global and one of New Zealand’s top female entrepreneurs) was there and ran us through a couple of her predictions for top trends in 2008. I thought that was kind of a fun idea, and thought I’d hit you with mine:

Greenifying transport – doing something about climate change

I think everyone has noticed a large shift this year in public awareness of climate change. It’s been really cool but also really frightening to see that a lot of what we’re doing about it, is talking. In New Zealand still, we get up in arms that the council is ‘anti-cars’ when they lower the speed limit along some of our city’s most pedestrian-heavy streets, we have a serious issue with a lot of car drivers who seethe in anger when they see a bike taking up valuable road space. Our council is pledging to make us the first carbon neutral city and yet find decisions such as allowing bikes on trains for free rather complicated.

I have a friend who is mid campaign to help the council understand the value of integrated transport systems and drive awareness of active transport. There is a whole heap going on in this area in Wellington, that, unless you knew someone as crazy as her, you wouldn’t know about. I think in 2008, we will reach the tipping point and people here will seriously start to question their use of cars as a primary method of transport.

Music shops will start to fade

One of our major retailers has already closed its doors and blames the internet and cheaper music buying alternatives.

Well…. duh!

Turns out people, when faced with the option of music that costs more and the same music that costs less, will go for the cheaper options most times. The value in a music store used to be the knowledge ideas they contained of new music and music you may like. You can get all this off myspace and iTunes now, so why go to a shop?

I think we’ll start to see this with a lot of industries, as the internet makes it cheaper and faster to access the value that was traditionally held in stores. This may sound frightening to some people, but I suspect these industries will simply evolve to exploit new opportunities: I hear the music industry now makes more money off selling cellphone ringtones than they do off cd’s…

The kids who have grown up with the internet get one year older

Why is this important? Because they are very different from us and the older they get the more they will take control of this beast we created but they understand. Things that worry people like my parents, such as getting a virus with every email, or clicking the wrong button, or their browser accidentally disappearing… are things that these kids don’t blink an eye at. They are already teaching their parents how to use technology like the internet, they are not held back by the same mental barriers we are and I can’t wait to see what will happen when they start to actively shape it.

Social networking sites will take over the world

I think Melissa was saying of every 1 million people in the world, 88,000 belong to a social networking site. I suspect that will probably double next year. Love them or hate them, applications like Facebook, Bebo and Myspace offer at the very least, enough value to stick with them. And as we all signup and enter our personal details, they gain ever more power… I have no idea what that will result in.

More virtual businesses

We have long since managed most of our business online, in fact, realistically, this business is 3 brains, 3 computers and an internet connection. So is PlanHQ, and many of the other startups here and around the world. There is virtually no barrier to entry… As long as you have an idea, some form of initial cashflow (as in a part time job or capital), you can have your own business. As the internet generation start to head towards teenagers, I suspect that we’ll see some seriously young entrepreneurs giving the world a run for it’s money.

Web Office VS Desktop Office Apps

One of the critisisms of evolutionone was that it was before its time and small businesses would struggle with the idea of managing their entire business on the web. I suppose we are young enough and technical enough to have always been involved in businesses where management through the web was a goal, not a fear and because of this, sometimes we overlook the hesitations of our less web-based counterparts.

Why You Need A Web Office is a good outline for the more reserved, although I would like to see a shortening of the timeframe before the early adopters move to a fully web based office. Especially newer, smaller businesses who don’t have a legacy IT department, haven’t invested heavily in Microsoft products and who could really benefit from the reduced costs and greater efficiencies of web based office products. I think the creation of web based business management products opens a massive opportunity for small businesses to become far more competitive and the sooner they are adopted by the ‘fortune 5 million’, the better.