I swear I read something other than Hacker News, but today I was reading the HN comments in response to this blog post by Chris Dixon about how once you start taking money the clock starts ticking. This comment in particular, in response to the idea that it would be good to know what companies ran out of money so that others could try the same idea, struck me:
Doubt it would work out that way most of the time. You wouldn’t have the same experience/knowledge/insight.
The same people could probably re-do a company smarter though. Foursquare is Dodgeball 2.0. Twitter is sort of Blogger evolved.
While I’ve always thought of Twitter in some very specific ways (started by some of the same people, it solves the big problem of blogging by taking away the big empty box), something specific jumped into my mind at that moment that I hadn’t considered before. I long believed that the core difference between Twitter and Tumblr was the decision to go with path names (twitter.com/heyitsnoah) versus subdomains (heyitsnoah.tumblr.com). While this doesn’t seem like such a drastic difference, it creates a very different kind of network and feeling. The latter (subdomains) are much harder to monetize on a per-page level because as much as it might seem illogical, advertising doesn’t work all that well on the long tail (Tumblr’s answer to this, of course, is that people keep refreshing the dashboard).
Twitter has solved this problem by keeping everyone within the main experience. Your page on Twitter is less your page than it is Twitter’s page and that makes it easier for them to sell long term. I was actually talking about this on Wednesday with a friend of mine who said he felt even more creeped out by Pinterest because it felt like it took the idea of the platform owning the page even further. He felt like everything he posted there wasn’t really his and as he found more popularity on the platform he’d eventually have to move it to make it more his own. Not sure I agree with the distinction between the two, but it’s interesting to think about how seemingly small choices on how to set up URLs can have a big impact on the way the site feels.
[Editor’s Note: I posted this over at the Percolate blog and thought it was worth posting here as well. Hope you enjoy.]
Andy Weissman wrote an interesting post about what he calls the “golden age of internet marketing.” Essentially his vision, which I mostly agree with, is that a few large platforms are going to create native monetization models that better align the interests of brands, consumers and platforms than display advertising ever did. Google and Facebook are the two clear winners in this world so far, as both have found ways to serve brand needs while creating a better experience for users (at least with paid likes in the case of Facebook).
There are a few additional thoughts I have on this whole conversation, though. First, what are the ramifications of a web that is controlled by a few successful platforms? Andy gives the example of Tumblr, Twitter, Facebook, Foursquare, Instagram and Soundcloud amongst a few others. All of these platforms have managed to generate a ton of user engagement and some are already at the user scale needed to support native brand interactions. However, this number will always be very small (in terms of total platforms, not total consumers). I’m not sure that’s a bad thing, but I’m also not sure it’s a good thing. I believe deeply that the relationship people have with sites is different than the one they have with platforms, and there will always be value there. The problem is, essentially, to be successful with an advertising buy on a website these days you need to do something native for their platform (the site), which will never have the scale that a Facebook, Google or Twitter does.
Second, I think a lot of Andy’s article places the onus to get this figured out on the brand, but I’d argue an even bigger responsibility lies on the shoulders of the platform to understand how brands actually work. A few weeks ago I wrote about some comments from Jack Dorsey at Twitter about their model. Dorsey talked about capturing intent, which has been a big buzzword around marketing Google’s search advertising was coined as an intent miner. As I wrote then:
Twitter’s value is not about intent, in the classic funnel definition, it’s much more about awareness and interest: About exposing you to new products and services you didn’t know you were interested in. If Twitter can actually deliver this it has a truly differentiated ad product, but I worry they’re following the Google model too much and thinking too low in the funnel.
This may seem like a semantic difference, but I don’t think it is. I think generally Silicon Valley has not done a good enough job understanding what brands are all about and what they’re trying to accomplish with their spend. I actually think there are a lot of startups that think brands are stupid, which seems crazy to me considering most of them are ad funded. What I’m trying to say is that building a native marketing unit requires respecting your customer (the brand) as well as your users (the consumer). At the end of the day what truly separates Google’s search ads from other marketing units is that it’s respectful: It believes the user is smart and the brand knows what it wants.
Last, but not least, I think these platforms are going to need to be careful not to overextend themselves. When Facebook reads an article like the one from Emily Steel at the Wall Street Journal a few weeks ago about some of the top brands spending a bunch of money buying likes and then shifting the spend to content to keep those likers engaged, they’ve got to pause for a minute to think about how they can capture more of that value. A native marketing unit can’t capture the entire chain of value and it shouldn’t. Google doesn’t keep you in Google when you click an ad and (hopefully) it never will. But when platforms like Facebook look at the numbers will they be able to not get greedy and try to capture a bigger slice of the pie? Or will they try to become more and more of a walled garden: Controlling as many pieces as possible and causing that beautiful alignment of interests between the platform, user and brand to get out of alignment.