Posts Tagged ‘Social Web Economy’

This is a continuation in the series on “The Social Web Economy“

In order for there to be an economy, there has to be money and advertisers are the ones that hold it. Advertising dollars are probably the most prized possession in the social web economy. Without it there is no business and all that remains is venture capital dollars. The advertisers spend money with four out of the five types of companies in the social web economy: agencies, ad networks, widget & application platforms, and media companies.

Advertising dollars are coming from two primary sources: advertising agencies and from brands directly. While some developers are paying other developers for installations, this amount should be considered negligible in the long-run. Advertisers are the life blood of the social web economy and it is one group of people who attract advertiser dollars: sales people.

So who are the advertising professionals working for? They work for the agencies and the brands. In the current economy they tend to be at the forefront of advertising when they invest advertising dollars in social media. One of the biggest challenges for these individuals is convincing traditional brands that they should be advertising in non-traditional channels (social media). Fortunately for these individuals, within the social web economy there isn’t much tension. Life is nice when you are the one that holds the money!

The primary challenge for advertising professionals is reporting back the results of social media and social networking campaigns. New metrics solutions are emerging to make this easier but the industry still struggles to quantify “engagement”. When you report to a brand that is used to spending money via the television, how do you explain advertising on Facebook’s news feed?

This is an industry wide challenge that all parties need to work together on improving.

Next post in series: “The Social Web Economy: Business Development and Sales People“

This is a continuation in the series on “The Social Web Economy“

As I said in the last part of this series, “for the most part, developers are not businesspeople.” As such the social web economy turns to entrepreneurs to be the leaders. Just as in the general economy, they are the individuals driving the social web economy forward. They are frequently jacks-of-all-trades and they are willing to do pretty much anything to build a business.

I have the utmost respect for entrepreneurs (possibly because I am one myself). Entrepreneurs are involved in pretty much all the activities that start-ups participate in. They make day-to-day business decisions, secure funding, build partnerships and alliances, determine a company’s strategy and are the ones accountable when a company succeeds or fails (failing is what happens most often).

I should make a distinction between generic “entrepreneurs” and “entrepreneur leaders”. All members of a start-up are theoretically entrepreneurs. They too are taking a risk by joining a start-up but the entrepreneur leaders are the ones held accountable for the businesses. All members of the social web economy are taking a risk but the largest risk takers are frequently the “entrepreneur leaders”.

I’d equate these people to the philosopher kings that Plato speaks of in his book “The Republic”. While there isn’t really one “ruler” per say in this economy, I’d suggest that this could be the most important role. Then again, no single role in any economy is most important.

Next post in series “The Social Web Economy: Advertising Professionals“

This is a continuation in the series on “The Social Web Economy“

“Developers, Developers, Developers!” This is probably one of the best known quotes of Steve Ballmer, CEO of Microsoft. Many people may find him crazy for the way he speaks about developers in the video that I’ve included below, but he’s right. Not just in the social web economy but in the digital economy, developers are some of the most important people. They produce the products and services that consumers use on the web.

When the social web was transformed overnight by the launch of the Facebook platform last year, many developers had mini-empires practically overnight. Whether it was individual developers or small teams of developers, these individuals now had businesses with relatively sizable revenue that they had to run. At f8 a couple weeks ago you could walk around the room and see how the passing of one year had impacted many of these developers.

Some had been acquired, others continued to go it alone. Those that decided to go it alone are now being pushed to their limits and realizing the challenges of trying to grow a small business on a global scale. The key takeaway is that developers for the most part are not businesspeople. While they may have the entrepreneurial spirit that burns in many of us, they are best suited at building the programs that we all have grown to love (or sometimes hate).

What is the source of developer tension? While developers have tension resulting from numerous sources (bugs in their applications, tight deadlines, etc), in the social web economy, the primary source of developer tension is the platforms. When a platform decides to revamp their entire system, or make sudden changes resulting from user feedback or malevolent actions by another developer, the rest of developers are impacted. On the Facebook platform the result was developers waking up at 3 am to fix their no longer functioning applications. Occasionally teams of developers worked around the clock in response to complaints from Facebook about terms of service violations.

While mature platforms don’t impact the developers as significantly, there will always be tension between the two parties.

Next post in series: “The Social Web Economy: Entrepreneur Leaders”