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Tuesday, April 30, 2013

Digitizing Permission marketing

When companies want to sell their products they advertise. What if a consumer, who wants to buy a product, does the same? Will companies flock to them and try to sell their wares? Well they should.

Imagine this 
A customer wants to buy a camera. He logs into any social website and says to his contacts - "I want to buy a camera what do you recommend." Immediately, a small site will be automatically created by search engines on their own within this say google will create a microsite, bing will also create one etc. 

What information will these site have? 
  1. A section on information where product reviews and comparisons
  2. A section on basics: For a camera site it will discuss photography, digital, films, about focus, aperture etc. 
  3. There will be a section on offers by various shops
  4. There will be a social feature indicating who amongst your friends owns which camera and what do they feel about it. You can also send them questions about shops and models.
  5. Camera companies can embed flash program to allow user a simulated learning experience. Similarly for other products like phone A/C, washing machines etc.
  6. A camera company site may also have some public visuals (untouched/unphotoshopped) that were clicked by that camera.
  7. A well-known camera expert could have some auto-suggestions for your profile. 
Reverse Wikipedia 
Think of the site as a reverse Wikipedia created for just one reader. This makes sense because a photography company or a camera company can spend its time looking on the web for resources while a single user cannot do so without intruding on his schedule. This information collected by different vendors then pools into a single place created for the user. This allows prospective sellers to market to exactly that person. However, since this information is ranked as per the relevance of the user by knowing his web surfing habits and his web contacts and things that they like to search and access, it will be completely customized.

Reengineered forums
If you visit a forum then one common comment you get on many post is that someone has already shared this or solved this previously and you should search within past posts. If only searching through past posts were that easy! Wouldn't it be easier if the forum found out what was already said and entered them as comments in my post?  

Curator lounge
Alternatively the site can be hosted by a curator. Thus a person who deals in wine can answer the questions once and the site back end can mine these answers while creating solution specific to the customer.

How does this use the Firm model?
In "Understanding Firms", we detailed the transaction model. One of the factors of innovation - namely incremental innovation was to shorten the transaction chain. The traditional marketing chain needs to be shortened by bringing the product closer to consumer. 

Traditional marketing, Seth Godin calls it interruption marketing, was designed to interrupt your work and bombard you with things they want to sell. Permission marketing, a Seth Godin innovation, changed this when companies sought to find out what you wanted and then try to sell it to you. What we have described is actually digitally enabled permission marketing and customized it for the user based on his/her habit and profile.

If you want to use this idea, you have to pay me royalty. Terms and conditions apply!

Tuesday, April 16, 2013

The Role of Regulators and Regulation

One of the critical findings of the sub-prime and subsequent crisis is about role of regulation.

The role of regulations is to balance the lop-sided accumulation of bargaining power against the citizenry. Specifically, where the interaction is between firms (organizations) and ordinary citizens, the nature and language of regulation becomes important as the firms actively try to usurp bargaining power against ordinary citizens. 

The job of regulator, as against regulation, is to be hyper-responsive in protecting the balance in bargaining power equations. Regulator, as against regulation, is speedier and active element introduced into the system to prevent the speedier innovations from disrupting the intended effect of regulations (which are rather hesitant to change).

Here is Senator Elizabeth Warren trying to force this concept on regulators who have become guard dogs of industry they regulate.