Amy Shuen Blog

More questions--Inside Web 2.0 executive panel at the Commonwealth Club and Yale Club of Silicon Valley

We didn't have time in 1 hour to cover all the interesting questions from the audience.
So I'll list some of them and post answers from the panelists as I hear back from them.

Voice 2.0:  Can we assume that all the programs and application here will work the same on my iPhone as on my PC?

We are a vertical professional collaboration network that is attractive to professional associations and publications.  What deal structures have you seen between the online Web 2.0 networks and communities and to older legacy/or offline traditional business networks?

Are most web 2.0 economic models based on advertising?  Why not directly sell goods and services?

Web 2.0 and web-based social networking tools are becoming powerful tools for political purposes--Obama fundraising or 23andme personal genetics--via Facebook apps?  Did Facebook anticipate this? What's next?  How could you encourage "worthy" apps like healthcare not just entertainment?

What can big high tech companies learn from pure Web 2.0 startups?

How do you find angel investors?

Please address your views about "data portability" and the importance of giving people access to and control of data about themselves.

If we had more time, as the moderator, I would have loved to have heard our panelists answers to:

What are the main differences you've seen or experienced between Web 1.0 and Web 2.0 companies?

Do you have some advice for the companies that are trying to make the move from Web 1.0 to Web 2.0?

What does the future of the Web look like for you?  In a recent MIT Tech Review, answers ranged from the "death of privacy" to "chips in our brain"?  What do you see--and how will your company play a role?



  

Inside Web 2.0 executive panel at the Commonwealth Club and Yale Club of Silicon Valley

If you were one of the fortunate 100 attendees at the beautifully-appointed Silicon Valley Bank auditorium yesterday, you know the answers to the following questions:

1. What is Web 2.0 and what makes Facebook, Meebo and Jajah,  Web 2.0 “stars” with a business model to be learned from?

2. How do Web 2.0 companies make money?  Exactly what is the business model and revenue stream of Facebook, Meebo and Jajah?  What are the innovative ways that a companies like these can give valuable services away for free and still be profitable?  How do other companies make money off of Web 2.0 platforms?   Do you have to be a pure Web 2.0 company to benefit from Web 2.0 platforms and open solutions? 

3. What one piece of advice would you give to entrepreneurs and companies trying to move to Web 2.0?

if you weren't there, you still have a chance to find out the fascinating answers and insights of Christa Quarles, Managing Director at Thomas Weisel Partners, Josh Elman, Platform Program Manager at Facebook, Seth Sternberg, co-founder and CEO of Meebo.com and Michel Veys, Chief Operating Officer of Jajah.

The hour-long panel discussion will be broadcast on KQED FM 88.5 on an upcoming Friday at 8pm and on KLIV Am, 1590 on an upcoming Thursday at 7pm.  We'll be posting the exact dates shortly.

C.    

Web 2.0 strategy story: Zahdoo social networking for families

I met Srinath Nagabhirava, CTO  of Zahdoo at the spring Web 2.0 Expo SF 2008.  We chatted while I autographed a copy of my book Web 2.0:  A Strategy Guide.  I caught up with Sri in September, just a week before his unveiling of his “social network for families” product at the Web 2.0 Expo NYC (September 16-18) for private beta.

At what stage of development was Zahdoo in April, 2008 when we met at the Web 2.0 Expo SF?

We were in the midst of developing a web 2.0 product targeted towards families.  Zahdoo is a socio-cognitive utility that helps individuals and families manage the daily juggle of activities, information and relationships.  We use customized semantic indexing algorithms.

Was the Web 2.0 strategy book helpful?

Your book was our reference in building our product (especially for our team in India) and some of the learning was incorporated in Zahdoo product development and marketing.

What were some of the lessons learned?

Your book changed our company strategy perspective and focus.  We started by thinking that our product focus would be “ERP for the home”.  Reading Chapter 1 of your book on collective user value changed our mission and framework into becoming a web service-oriented software app-- “ a social network utility for families”.  We prioritized putting our company’s focus on web-enabled social and per-user benefits and network effects.  

We realized that we could generate more positive network effects by helping enable smaller trusted private social networks, neighbors, circles of friends to benefit from their collective online conversations, know-how, social/school/sports/kids calendars—whether in planning a trip to Disney World or Europe, finding a local plumber quickly or figuring out if your kid’s stomach-ache was likely something going around third grade or something the doctor should look at.

Who’s your target user or customer profile?

Parents—Mom or Dad—with kids at home and who value time with family and friends.  Mom and Dad—who are knowledge workers and professionals but whose expertise is in more traditional companies and industries (and maybe less web-savvy) need an easy to use social network utility that helps them juggle their many commitments and networks, optimizing resources, money and time.  Zahdoo is the Web 2.0 answer we've developed for them.

How does your company make money?

We are trying to build in three revenue streams—

(1)    Advertising

(2)    Other channels such as listings for small/local businesses and services like the plumber example.

(3)    Sponsored content such as prepopulated lists for local services

What are your growth targets?  50,000 users in 6 months, 100,000 in a year’s time. 

An answer to What CIOs need to know about Web 2.0 strategy and social media--ROI...

My email answer to Werner and others with "ROI of Web 2.0 and social media" questions:

These are great questions—the short answer is no, not yet… the long answer is that answering those 2 questions and putting them to work in companies is the main focus of my current academic research and consulting.  Here’s why:

1.      How to compare social networking across cultures?.  We know that individual reactions to website images, online branding may be mediated by Hofstede-like cultural factors.  Large scale cross-national meta-data studies of Bass curves indicate that “social influence”, (a more operationalizable and quantifiable variable of the ratio of q/p in the Bass curve than “social networking”)  varies quite significantly in different countries/cultures.  In other words, social networking and viral/buzz marketing tends to work faster and proliferate more effectively in highly “collective” populations, although the higher risk and individuality threshold may make it difficult to “trigger” and reach critical mass.    (See Chapter 3 of my book and end note Bass Diffusion Curve p. 200-1).  These findings have a big strategic impact on multinationals,   not only in their IT groups but their marketing and marketing/competitive intelligence groups.

2.      How to calculate ROI or cost-benefit analysis for “social networking” in a global business organization?   

a.      The key is to start with per user economics and metrics.  (See chapter 1 and endnote single customer/subscriber cash flow analysis p. 179).  You can’t calculate ROI and cost-benefit analysis correctly for social networking if you start with an accounting basis of units or services rather than the lifetime user value.

b.       Once you have the right framework and timeframe (lifetime relationship/p2p interactions, not transaction) it becomes much clearer how social networks generate, multiply and remix positive network effects (a more quantifiable and measurable concept underlying “synergy”)

c.      The last step in ROI analysis is to show how a specific company captures that positive network effect value in their business model or organization—via direct or indirect revenue, ppc or brand recognition sponsorship, customer loyalty, talent retention or job satisfaction,  increased speed or time to money, partnerships, knowledge management etc.... 

d.      Another level of analysis to be considered is the enterprise level.  Social networking and Web 2.0 strategy is becoming an important analyst criteria for judging the potential of a traditional industry company to be an innovative leader taking advantage of global broadband, mobile and web interconnectivity in the knowledge economy going forward.  So that future earnings potential and P/E for a web 2.0-savvy company tends to be above industry average.

e.      In other words, the information and knowledge management—share point or other-- that the IT groups put into place ends up having payoffs and returns in lots of cross-functional areas—marketing, product development, hr, speed, intellectual property, company capabilities, partnerships—as well as at the financial enterprise level.   This is why for accounting purposes, the ROI needs to be tied to the number of people/users (inside and outside the company) not to narrow product/service lines.     

 

I just put together a onsite workshop on “Social Media  and User Lifetime Value Analysis” that you and your group could find helpful.  Since my book is now available in German, http://www.oreilly.de/catalog/web2strategyger/

I’m starting to schedule seminars and presentations in Munich, Frankfurt and Berlin.  Let me know if we should arrange a time to talk. 

What CIOs need to know about Web 2.0 strategy and social media--ROI...

Werner, an  IT Manager for a large multinational foods retailer read the following social networking article in the CIO magazine where I'm quoted...    http://www.cio.com/article/print/443064.

He emailed the following question, one that is likely shared by other IT managers and CIOs in the enterprise and large corporations right now.  (He gave me his permission to post his email and my response). 

I found the question both insightful and realistically nuanced--CIOs need to know about the ROI of Web 2.0 strategy and social media AND if it varies in different cultures (national and organizational) AND what metrics will work in global organizations where the payback for one hour+ a month over 10,000 employees (in 10+ different countries) needs to be considered.

Here's the text of the question...in the next post, I'll tell you my answer... 

 

Q:  I find it [your comments quoted in the article] very interesting because we are currently discussing the benefit of rolling out Microsoft SharePoint “My Site” and “My Profile” globally.

 

Now my questions:

Having the IT context in mind, have you ever seen a study or comparison how “social networking” works in different cultures? Do you know a cost/benefit analysis about “social networking” in global business organisation?

 

My concern is that employees spend a lot of time to maintain their sites and play with the system – but what are the synergy effects in $ on the long end.

Imagine that 10 000 employees spend one hour a month in thee system – a lot of resources! ROI is a critical factor for success in this scenario as soon you support “social networking” with an IT-Platform like SharePoint.

 

Thanks in advance for your input.

Best Regards

Werner