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All Business Starts With A Community

By - August 19, 2009

small biz starts with a community.jpg

Today I was on my way back to our house after dropping my kids off to camp, and I decided to stop by a local cafe for a quick coffee-n-chat. Now, in August, “our house” means a century-old family place on an island, an island that rather pugnaciously refuses to allow large chain stores to set down roots. So it’s fair to say that this island is sort of a Galapagos of small business. There are no Mickey D’s, no Safeways, and no Starbucks. It’s all locally owned – nearly every single “year rounder” who lives here is a small business person.  

The local cafe I stopped by is a hangout – a place where the community comes to eat and drink coffee, to gossip and share information, to learn the latest, to connect. It’s a social network in its truest sense. It’s driven by content – the conversations and knowledge of the staff and customers, and it’s driven by community. Commerce is a by product of the two.

But the commerce is not limited to just the coffee and egg sandwiches on the menu. Not by a long shot. Like nearly every other cafe and community restaurant on the island, there’s a bulletin board, and everyone who has something to promote puts up their business card or their flyer. And you know what? It works.

I love this picture. If you really think about it, it tells you just about everything you need to know to succeed as a business in the digital age.

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Twistory 101: It's All About Small Business

By - July 24, 2009

biztweetbird.pngThe world’s abuzz this week with word that Twitter is getting serious about business – the proof point being Twitter’s new subdomain “business.twitter.com” and the “Twitter 101″ handbook currently living there, a white paper of sorts aimed at helping companies figure out how to leverage the sometimes befuddling service.

This all reminds me of Fall 2004. Back then, Google was coming on hard in search. And while the world viewed Google as an upstart stealing query share from the incumbent Yahoo, the real drama was happening on the business side. By the Fall of 2004, Google’s AdWord and AdSense solutions were warranting serious attention from the same ecosystem of SEO/SEM that previously had focused on Overture’s offerings.

In this Fall, 2004 thread on Webmasterworld, where SEO types hang out to talk shop, search marketers debate the relative performance and profitability of Overture compared with Google. Prior to that year, Overture was the undisputed king of paid traffic. But in ’04, Google started pulling ahead, and since that time, it’s never looked back. Why?

Well, there are myriad reasons: Google had a better consumer facing search experience than Yahoo (Yahoo bought Overture in 2003), and Google’s AdWord service including a quality ranking score (as well as paid ranking like Overture), for example. But I believe something else was at work, an upward spiral of adoption by small business advertisers.

What do I mean by that?

Well, I was covering the search space pretty closely back then, and one of the metrics touted by both Google and Yahoo were the number of advertisers who were using their service. Google didn’t publicly announce those numbers, but my sources inside the company did whisper them to me from time to time. Overture, on the other hand, touted their “active advertiser” numbers in their public filings. Its number of active, paying advertisers crossed 100,000 around the time of the Yahoo acquisition, and upwards of 200,000 a year later. Who were all those advertisers? That early in the search revolution, they sure weren’t the Fortune 500, or even the Fortune 5000. They were SMBs – the lifeblood of the US economy, responsible for two thirds of jobs and the driving force of a nascent recovery from the 2001-03 recession. These businesses live on the edge of profit at all times, and they are always the first to find tools that might help them succeed. By ’04, tens of thousands of them had found paid search.

As far as I could tell, Yahoo stopped disclosing the figure after the acquisition closed. And as I was strolling the halls of the first Web2 conference (October 2004), I got a phone call that might explain why. The call was from a source at Google, who wanted me to know that Google had eclipsed Overture in the number of total active advertisers. I couldn’t confirm that number, nor could I get Overture/Yahoo to respond, so I dropped the story (can you imagine a blogger in the tech world not printing a story like that now? How times change.).

twit101.pngAnyway, I was reminded of this anecdote while reading through “Twitter 101″ and it occurs to me that to really succeed, Twitter must be useful, really useful, to small businesses. It was those tens of thousands of small businesses who drove success at Overture, and then at Google. Search became an essential channel for lead generation, and Google became the dominant player in that channel.  

Billions ensued.

While a lot of the attention around business success on Twitter focuses on big brands like Comcast, JetBlue, or WholeFoods, the ecosystem that will really drive value, revenue, and profit for a TweetSense like execution will be the small business ecosystem. And absent a clear service like AdWords for Twitter, a user manual of sorts that explains why Twitter can help business makes an awful lot of … tweetsense.

Vark Goes Twitter

By - July 07, 2009

aardvark_twitter.pngI’m on vacation this week, ostensibly, building a treehouse and taking time off. Hence the light posting schedule. But I’ve also been tracking Aardvark, the lightweight question answering service that uses your social graph, IM, and email accounts as a channel to intelligently route complicated questions to those who might best answer them, and as readers know, I’m intrigued.

So when Max Ventilla, Aardvark’s CEO, told me he was finally integrating Twitter, I knew it’d be big news.

As explained on the Vark blog, using the service on Twitter is simple:

Now you can ask Aardvark a question via Twitter: Just include ‘@vark’ and a question mark (‘?’) in your tweet Aardvark will find the perfect person to answer, and Direct Message you their response in a few minutes (Set up Aardvark to recognize your Twitter handle here: http://vark.com/profile/twitter)…..Aardvark is all about providing the questioner with a magical experience of getting any question answered in about five minutes, and providing the answerer with a gratifying experience of helping someone out in a moment of need. We think asking questions via Twitter is a natural way to bring this experience to more people.

I feel the same way. I’ve used Vark on Twitter in private beta and it worked great. Now that the service is public, I have a feeling it’s going to become one of the most useful applications on Twitter. Next step, Groups, and then watch out….

When Value Is Created, Let It Be Curated At Scale

By - June 25, 2009

Facebook’s opening up even more, as CNet reports. Facebook has posted an update to its “Publisher” settings – basically, the instrumentation to your status updates – that makes it possible to broadcast the value you create in the social web through composition – of a status update, a blog post, or any other action that you might wish to declare. You can instrument it to be seen only by your network, or your network’s network, or everyone – and it’s that everyone part that makes Facebook a lot more like Twitter in terms of the ability for developers to create interesting executions based on that firehose. Think about what Microsoft did with ExecTweets, but with Facebook scale. Of course, that’s just the tip o’ the iceberg. Exciting stuff.

Thoughts on Online Marketing

By - June 21, 2009

Many folks have asked me when CM Summit videos would be posted, several are up now. They include the opener, above, in which I give a short overview of the state of online marketing from my perspective – start at about 6 mins in if you want to miss the throat clearing of setting up the show and thanking folks I’ve worked with. Perhaps the key thoughts: People Don’t Join Ad Networks, and Publishers Are Communities of Mind.

Twitter Bumps Ceiling

By - June 10, 2009

quantcast twitter june.pngIt had to happen, and it has. Twitter’s unbelievable growth numbers have flatlined, or even gone down, if you look at Quantcast (the site is not Quantified).  

This was predictable, given all the media hype and new folks, and the very real newbie problem I outlined in this post last month.

I predict Twitter will address this issue, and growth will resume, but at a more moderate and sustainable pace. But this is a very clear sign that Twitter, which made the cover of Time magazine last week, is on the other, less happy side of a traditional hype cycle.

As a reminder, here’s what I said in a post just a month ago, noting the incredible growth of Twitter:

I think this is both Twitter’s most important and dangerous phase of its young life. The retention problem must be addressed, and quickly. In my previous post about Twitter adding value to new users, I suggested Twitter incorporate some structure around its suggested users feature.

But with an inflection like this, I think it’s time to swallow hard and embrace some serious social media jujitsu. In short, Twitter should integrate Facebook Connect in its signup process, and offer it as a feature for current users.

English's Millionth Word: Web 2.0

By -

web2.pngFor the past few days I’ve been focused on a final draft of an essay, co-authored with Tim O’Reilly, focusing on the theme of this year’s Web 2.0 Summit. It’s rewarding work, reminiscent of the early days of Wired, when I’d regularly edit or write long form pieces focusing on big ideas and the future, but grounded in real world examples from today.  

But writing and editing this kind of stuff is also challenging work, and I often procrastinate, as I am right now, by writing a blog post or skimming the web for interesting tidbits. And boy, did I find a funny one today. According to CNN, the term “Web 2.0″ is not only now an “official word” in the English language, it’s also the millionth one, of all things. (This according to the Global Language Monitor, a website that uses algorithms to determine when words enter the language.)

Too funny!

The theme for this year’s conference is “Web Squared,” a very real nod to the idea that “Web 2.0,” five years in, needs to be refreshed. From the draft Tim and I are working on:

The Web is evolving so quickly, it’s clear the “versioning” terminology that we borrowed from the software industry – Version 1.0, 2.0, etc. – no longer captures the pace and impact of the Web’s true nature. The web opportunity is no longer growing arithmetically, it’s growing exponentially. Hence our theme for this year: Web Squared.

We plan to post a draft of this paper soon, and will be asking for all your input in making it better. Meanwhile, it’s kind of cool that a term Tim and his partner Dale Dougherty coined way back in 2003 has made it into the history books. I wonder if and when “Web Squared” might make it in?! I guess we’ll know in five or so years…

As We Head Toward A More Conversational Interface, Can AdWords Keep Up?

By - May 15, 2009

Gian Fulgoni, Executive Chair of Comscore, has an interesting analysis of what’s happening in paid search lately. It’s germane to my earlier posts about paid search share sliding and Google’s decision to allow trademark ad bidding.

In his post, Gian notes that overall search queries are up dramatically (68% over two years) but:

if one looks at the number of paid clicks, the growth rate is a lower 18%, which raises the question: why have paid clicks grown 3x slower than the total number of queries?

Gian answers:

The reason appears to be that the ad coverage (i.e. the percent of search results pages with a paid ad) has dropped from 64% to 51% of searches.

Here’s where it gets interesting. Why has ad coverage dropped? Gian has two hypotheses. First, search engines are getting better to reduce less relevant advertisers from the mix. But the second reason points to a more important potential breakdown in the AdWords model:

comScoreWords-per-SearchUS.gifAn analysis of comScore data shows that search queries are actually getting longer and that as searchers become more experienced they are using more words per search query. And this apparently reduces the likelihood that an advertiser has bid to have his/her ad included in the results page from these longer queries, due to paid search advertising strategies that limit ad coverage, such as Exact Match, Negative Match, and bid management software campaign optimization.

In short, our queries are getting closer to real conversation, real natural language, and Google’s algorithms are having a harder time keeping up – matching advertiser demand to our increasingly complex queries.

As Gian said, fascinating.

Also worth noting, my pal Chas’s analysis of what the decline in paid search means for brand advertising.

New SMB Post: Cultivate That Garden

By - April 10, 2009

Over at the HP SMB marketing site, my second post is up. Now, for most of you, this stuff will not be particularly new, but it’s good to recall that just 42% of all SMBs have websites, and most of those are not particularly social in nature. From my post:

Most small business websites are not very good. That means you have a chance to really stand out. And that’s a huge competitive advantage.

At this point you’re probably rolling your eyes and saying “Yeah, right. Now I have to spend thousands of dollars making something that’s just going to break in a few months, and then I’ll have to pay another grand to fix it.”

Not true. With small business and the web, the best way to start is to start small, and start social. Your business is a network of relationships – between vendors, clients, colleagues, and co workers. So instead of worrying about boiling your website ocean, trying simmering the social seas instead.