Posts Tagged ‘Web Buyer’s Guide’

How to get over the fear and start your own business

Tuesday, February 12th, 2008

Starting a business all begins with the first step – the statement, which then turns into a belief, that later turns into a mantra  – that I AM STARTING A BUSINESS. This step happens differently for everyone, but this is my story of how I got over the fear and started a business, supplemented with the stories of friends and acquaintances and the entrepreneurs featured in the book Founders at Work: Stories of Startups’ Early Days. (All the quotes below are from that great book. If you are an entrepreneur, buy it today, it will inspire you.)

Start image

I’m convinced that in order to be able to get over the fear and start your own business, most people go through some combination of the following things:

You can’t keep doing what you have been doing. I am pretty sure that starting a business involves some level of desperation. For me, when I made the decision to start my own thing, it was early 2007, I was working for Ziff Davis Media, heading the product development team for the Web Buyer’s Guide. Things were going great with the division – we were one of the favorites in the company, making money hand over fist with a long list of the top clients in the industry. I was working with an amazing team of people, I truly liked and respected my bosses and the people who worked for me. But I was growing increasingly dissatisfied with my job. The problem was, with things going so well, I had little hope that they would ever change. The better things went with the group, the worse I felt about the job because I had to keep things going, to make sure that the clients stayed happy, to just do more and more and more and more of the same.

I love building new things. I like the creativity of it, the innovation of it, the challenge of trying to figure out how to solve problems. I enjoy gathering a team of people who can all collaborate to get something done. And I like the thrill of launching something new. I couldn’t possibly stand to stay still, the lack of creativity was sucking me dry. I had to do something else.

You realize that the only way to do what you want to do is to start your own thing.  Once I knew that I wanted to do something else, I knew that I wanted it to be related to using the Internet, and I knew that I wanted it to be creative. But the more that I thought about it, the more that I knew that going to just some other company wasn’t going to solve my problems. I already worked with really great, smart people. And another company would make me specialize, as well. I realized that what I really wanted to do was have the flexibility to do lots of different things, all the time, just the way that I wanted them done. There is no job description that reads that way.

“I think the hallmark of a really good entrepreneur is that you’re not really going to build one specific company. The goal – at least the way I think about entrepreneurship – is you realize one day that you can’t really work for anyone else. You have to start your own thing. It almost doesn’t matter what that thing is.” – Max Levchin, Cofounder PayPal

You understand the odds are against you, but you believe that you will beat the odds. The statistics for businesses to fail are staggering. It’s something like 8 out of 10 businesses don’t make it past the first year, and 8 out of 10 of those don’t make it past the second year. Something horrible like that. But, I believe I will be one of the successful ones. Why? Because I know I can do it, which is not a good reason, I’m sure. But if I didn’t believe that I would succeed, I would never have started in the first place. There has to be some level of (sometimes irrational) optimism in every business founder.

You figure out your biggest points of fear and try to work around them. For me, the prospect of starting a company led to three major fears. One, I didn’t know how to do the stuff related to starting a business because I hadn’t done it before. So I found some mentors and a business partner who have vast experience in this area and who can help me when I have questions. Two, I was concerned about putting Chris (my husband) and I in debt because of the business. I overcame that fear by taking a very small salary out of the initial seed money. I took a fairly substantial pay cut, but having just a small monthly income gives me the peace of mind that I am at least not going backward in my financial situation. Three, I was concerned that everyone I knew would think I was crazy. That issue was not something I could fix, but it was a personality flaw anyway, so I decided that being faced with that type of opposition would help me to grow as a person so it was worth facing the fear. The fears will be different for everyone, but all business owners will have to figure out how to face them.

“About the next day after I said no to starting Apple…my friend Allen Baum called me in the afternoon and he said, ‘Look, you can start Apple and go into management and get rich, or you can start Apple and stay an engineer and get rich.’ As soon as he said it was OK to do engineering, that really freed me up. My psychological block was really that I didn’t want to start a company. Because I was just afraid. In business and politics, I wasn’t going to be a real strong participant. I wasn’t going to tell other people how to do things. I wasn’t going to run things ever in my life…I just couldn’t run a company. But then one person said I could be an engineer. That was all I needed to know, that ‘OK, I’ll start this company and I’ll just be an engineer.’ To this day, I’m still on the org chart, on the bottom of the org chart – never once been anything but an engineer who works.” -Steve Wozniak, Cofounder, Apple Computer

You realize that other people do this all the time. The other thing that really helped me was to realize that other people start companies all the time, which led to the feeling that if they could do it, I could do it too. Chris started a business in 2006, and it was doing well, so that was encouraging. I was part of a company that was a start-up that was acquired by Ziff Davis, so I had seen how it was done firsthand. Although starting a company was daunting, just knowing that other people had started companies in the past was helpful.

“We both had parents who were entrepreneurs, so the idea of running your own business was a normal thing. There are people who come from backgrounds where they’re used to working for a company, and they couldn’t dream of doing it themselves and not having that safety net. When your parents and family are entrepreneurs, you know it’s nothing special. I worked at big businesses and I worked at small businesses beforehand, so the idea of starting your own business was just a normal thing.” – Dan Bricklin, cofounder, Software Arts

You weigh the benefits vs. the risks and responsibilities. For me, the timing was right to start a business. I was married, with an income-producing husband (who is also an entrepreneur, but his company, which builds medical devices for spine surgeries, had four submissions into the FDA for approval and it looked good that they were going to make it). I didn’t have any kids, no mortgage, no debt. My risk was very low because my responsibility was light. This is one of the reasons that so many young people are starting companies, because it doesn’t hurt them too much to do it. If things fail, they can always put on their resumes that they were the founder of a company. People who have a lot of responsibility have a harder time making this jump, and it is really important that they carefully weigh the risks before starting anything.

You jump in, even if it’s stupid. At some point, after you consider all these things, you just take the plunge. For me, that involved going to my bosses, thanking them for everything they had done for me, and resigning from my job. I was lucky because I was able to make a slow transition, I gave them a lot of notice, and I took some time off between Ziff Davis and my new business. Not everyone will have the luxury, but at some point, that statement has to be made: “I’m going to start a company.”

“There are a lot of programmers that are very tentative about starting their own companies. There are a lot of working programmers doing something they hate, with some company that they hate, but they need money to pay the mortgage. So they figure, ‘I’ll develop something in my spare time. I’ll put in 1 hour every night and 2 hours on the weekends and I’ll start selling it by downloads.’…But because they never really take the leap and quit their job, they can give up their dream at any time. And 99.9% of them will actually give up their dream. If they take the leap, quit their job, go do it full-time – no matter how much it sucks – and convince one other person to do the same thing with them, they are going to have a much, much higher chance of actually getting somewhere. Because they either have to succeed or get a job. Sometimes ‘succeed’ seems like the easier path than actually getting a job, which is depressing. So quit your day job.” – Joel Spolsky, cofounder, Fog Creek Software

Tomorrow, I’ll talk about what happens after you make the leap.

What SkyMall can teach you about user testing

Wednesday, January 23rd, 2008

I’m on the plane right now, on the way to Jamaica with Chris, who is going to a conference (I’m tagging along), and we just spent about half an hour looking through SkyMall, the catalog of often-quirky products that they have in the seat-backs on the plane. I love looking through SkyMall, mostly because it makes me laugh the things that people come up with and actually sell. Some of our favorites from this issue:

  • Gravity Defyer shoes (page 13) – Really Alexander the Innovation Wizard that is the best part of these shoes. Chris’ title is “Chief Innovation Officer” so I was trying to get him to change it to “Chief Innovation Wizard” after seeing this picture of Alexander.
    Alexander the Innovation Wizard
  • Spring Flex UX (page 66) – This ad features a man wearing nothing but white – shorts? underpants? – working out at his desk. Ummm…
    SpringFlex UX
  • CD case(page 79) – This case holds 2,262 CDs – they better sell these fast before people stop buying CDs (does anyone own 2,262?) and the music industry implodes!
    2262 CD rack
  • Caddie Cooler (page 80) – “Cleverly disguised as a 3-wood,” I sincerely doubt that my dad or brother will be bringing this out on the course anytime soon.
    Caddie Cooler
  • The Neckpro Traction Device (page 108) – The picture speaks for itself, but there must be a very limited market for this device.
    Neckpro traction device
  • Big Foot the Garden Yeti Sculpture (Page 161) – Definitely not something to welcome the neighbors
    Big foot the garden yeti
  • Basho the Sumo Wrestler table(page 160) – Will go well with any decor, unless you’re sitting behind it…
    Basho sumo wrestler table

And these were just the products that made us laugh the most. Every page of the catalog we were pointing at things and commenting and talking about the good ideas, the bad ideas and how to improve some of the products that had a nugget of a good idea, but executed it poorly.

This made me wonder if the SkyMall people do user testing. Do they have consumers come to the SkyMall offices, give them the most recent copies of the catalog, and watch them interact with it? It is impossible to watch every person read and use their product, but how much testing do they do, and how much do they use the data they collect to make changes and to help them pick what will be included in the catalog in the future?

There is a really good correlation to the Web here. Any business that has a Web site (and every business should have a Web site) should also have some kind of analytics tool running on their site. I use Google Analytics on my Web sites, but I have used Omnitureand others in the past as well – any of them work (but I whole-heartedly recommend Google Analytics – it is free and very easy to set up).

Once you have analytics set up on your site, you should be able to do some user testing – you will be able to check out, among many other things, what pages people visit on your Web site, their navigation path, what pages they linger on, what are the most and least popular sections of the site. And if you sell things on your Web site, you can easily evaluate how appealing various products are to your market.

Along with this day-to-day evaluation, it is also a good idea to occasionally do user experience testing. It is incredibly illuminating to be able to watch your users interact with your Web site. When we ran such tests at Ziff Davis Media, we used software called Morae, which worked well. When we ran the tests, we had two computers set up; one in the user testing area, the other in a viewing area where everyone else could watch the users go through a set of tasks. (Our stations were actually set up in two different states.) The users are taken through a series of tasks by a tester (a guide of sorts) who asks questions and gives the users various tasks to complete. The users are instructed to talk out loud about what they’re thinking when they are navigating the site, and the software on the testing computer records all the various motions that the user makes, their facial expressions and their voices. The viewing computer has a split screen, which allows the observers to watch both the users’ faces (which are recorded via a Webcam) and the users’ desktop displays at the same time. It’s amazing the things that you can learn in just a few short viewing sessions.

Do you do any user testing on your Web site? If not, start somewhere. Make sure that you have an analytics system installed, and begin checking it and learning what all the numbers mean. It won’t be long until you can make simple changes that will lead to vast improvements to your site.

The solution to search engine fatigue

Wednesday, October 24th, 2007

Internet users are tired of trying to use a search engine to find something that they want, and not finding that thing. This seems obvious, but it’s the conclusion that’s been reached following a recent survey of 1,001 U.S. adults called “State of Search.” The research was conducted by Kelton Research for Autobytel. The primary finding from the study is that 72% of searchers have “search engine fatigue” meaning that they become impatient or frustrated when they are unable to quickly find the exact information they need when using a search engine.

I’m actually surprised that the number isn’t closer to 100%.

Some statistics from the report (thanks to Search Engine Land for this information):

- 65.4% of Americans say they’ve spent two or more hours in a single sitting searching for specific information on search engines.

- When asked to name their #1 complaint about the process, 25% cited a deluge of results, 24% cited a predominance of commercial (paid) listings, 18.8% blamed the search engine’s inability to understand their keywords (forcing them to try again), and 18.6% were most frustrated by disorganized/random results.

Search Engine Land draws the conclusion that this is an argument for personalization in search, and in part it may be. But I think that these results also point to the need for comprehensive and information-rich vertical search alternatives to aid in the buying process – not as a replacement to the popular search engines, but as a supplemental tool.

The difficulty of using the popular search engines in the buying process is nothing new. This study was conducted to illustrate problems in the car-buying process, but the same issues happen in other product buying cycles, including the IT buying process. When I worked on the Web Buyer’s Guide, the goal of the site and technology that we built was to provide a better technology buying process for IT professionals. At the time, I would do a demonstration to explain to people why this type of vertical search engine was essential for the buying process – and why Google and Yahoo wouldn’t work for buyers who were trying to do the research that’s needed to make a product purchase.

I used the term “CRM” (customer relationship management) to demonstrate. First, I would type “CRM” into Google to see the results – 83,900,000. I then modified the search to CRM Products – 34,300,000. Still too many results. This is the #1 problem with search engines for the 25% of people who complained about a “deluge of results” and why, in the survey results, nearly 40% of Americans described finding the “right and relevant” information in the big search engines – Google and Yahoo – as “overwhelming and time-consuming.”

The next search that I did was with WBG’s top competitor – KnowledgeStorm, another IT product directory. For the search, I went to their CRM page and asked someone in the crowd to name a random CRM company. Different answers were given, but usually one of the top companies was named, such as Pivotal, Oracle or Salesforce.com. Typically, if I was to search for products from any of those companies in the KnowledgeStorm directory, they weren’t included in the list because they weren’t KnowledgeStorm’s paying customers. This type of situation causes two levels of frustration for users, both because all the results that are displayed are commercial (paid) listings, and because this forces buyers to go elsewhere to find a complete list of CRM products when 85% of buyers want to find a one-stop shop for everything related to their purchase.

To overcome the buying process issues that both the search engines and limited product directories have, we built a vertical directory based on technology product categories. This vertical directory included every bit of information that Ziff Davis had about each of those categories – editor reviews, articles, news, user ratings, etc. – combined with a comprehensive product directory and resource library with information from the IT vendors themselves, including white papers, videos, etc. By surrounding each technology category with all the relevant content in each category and a comprehensive product list, we allowed IT buyers to be able to get a complete view into the product that they were attempting to buy.

In the State of Search report, nearly 25% of respondents said that they actually put off purchasing a car because they found the overall car-buying process too overwhelming or frustrating. Autobytel built a vertical directory to try to solve those issues, and I think that they might have hit on a viable solution if they are able to execute.

~ Black & White ~

What's next for Internet advertising

Thursday, October 11th, 2007

Look into the futureGoogle revolutionized Internet advertising in 2000 when it launched AdWords and the pay-per-click (PPC) model. This program was ground-breaking not just because the small text ads that ran alongside Google search results were served up based on relevance, but also because, for the first time, marketers paid only for an action (a click on their ad) – they didn’t have to pay for the thousands of impressions that were not clicked. With AdWords, performance-based media was born.  

Once advertisers demonstrated that they were willing to pay for any click, it was a short leap to believe that they would be willing to pay even more to know exactly who it was that was clicking. Today, lead generation and pay-per-conversion models (Google calls this cost-per-action) have joined PPC as viable business models, providing even more information to marketers who are trying to reach their customers.

 

Lead generation and cost-per-action pricing models are already popular in the B2B world. In the IT market, for example, Web Buyer’s Guide, KnowledgeStorm and Bitpipe are providing lead generation services to the biggest technology companies, which pay anywhere from $20 to $120 per lead to reach the specific individuals that they think are most likely to buy their products.

The Internet advertising market is going to continuing to move from static advertising to performance-based media. According to the just-released IAB Internet Advertising Revenue Report, approximately 50% of 2007 second-quarter revenues were priced on a performance basis, up from 47% reported for the second quarter of 2006. Lead generation revenues accounted for 8% of the 2007 second-quarter revenues or $408 million, up from the 7% ($284 million) reported in the second quarter of 2006. Contrast those statistics with the fact that approximately 46% of 2007 second-quarter revenues were priced on a CPM or impression basis, down from 48% for the same period in 2006.

Performance-based media is the future. We have already seen the movement with traditional Web content. Blog content, podcasts and video are all moving toward incorporating PPC pricing models, as well. I think the next move for these newer content formats is lead generation and cost-per-action. Let’s take video as an example. Silicon Alley has a write up about how advertisers are starting to take video more seriously, but that CPMs are declining. There is a debate going on around how money is going to be made on video advertising – what kind of ads will be used, the length, the format, etc. Applying the move toward performance-based media, I believe that someone is going to develop a lead generation engine around online video that will provide advertisers not only with the information on what videos were watched and how many times, but by whom and what their demographics are. Web Buyer’s Guide has a product on the market that does this, and I think it’s just a matter of time until one of the major video providers offers this type of advertising package.

And looking even further down the road – what’s the next wave of performance-based media? Right now companies pay for leads, but what if in the future companies begin to pay only for customer acquisition, and after an individual makes a purchase the lead provider gets a percentage. A large percentage. Sound like the affiliate programs that are widespread in the consumer market? Sort-of. But what happens when the technology is developed for a video provider to track an individual from the first video that they watch that peaks their interest in a product, all the way to the buy, and the video provider gets a portion of the sale?

Now that’s performance-based media worth talking about.

Disclosure: I used to work for Web Buyer’s Guide.

 

~ Foggy Autumn ~