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Have they changed the types of online business model?

Adaptation of the business model of a company over time is a key to the survival of the company factor, medium and long term. But the types of business model Internet have changed since 1992 when the first website was created to this day?

Types of business modelEverything depends on classification we use.

With an overall ranking as the "4C" Wirtz, Schilke and Ullrich (2010) (the image along these lines) observed that typologies have not changed. Businesses that were created in the late 90s and businesses created in 2018, can be classified into one of four types:

  1. Oriented business creation / selection / compilation of content (online news, blogs, youtubers, etc.)
  2. E-commerce oriented businesses close transaction whether or not (Amazon, eBay and any online store)
  3. designed to give context to information business (this is the case of Google, for example)
  4. Business oriented to provide networking services (Facebook, Linkedin, etc.).

Although there are some whose model is hybrid, such as Youtube, which in turn gives context to content, but also includes social networking features. The same could be said of Instagram if we consider more than just a social network.

On the other hand, returning to the beginning of this article, lyou must continue to adapt its business model as time passes, este es el caso por ejemplo de Amazon, que empezó en 1994 como tienda online de libros, poco a poco fue incorporando su comunidad de lectores que enriquecían las fichas de los libros, luego pasó a comercio electrónico de todo tipo de producto y finalmente combina su comercio electrónico con un marketplace. Utilizando el modelo de las “4C” parece cómo si no hubiese cambiado, pero lo cierto es que dentro de lo que los autores del “4C” consideran comercio electrónico, hay todo un mundo de subtipos de modelo de negocio… pero profundizar en este tema lo dejaremos para otro artículo.

In case you are interested in topics of the archetypes of business models, I'll leave this table under these lines is what I use in class when I explain the model of the "4C" and key success factors of each type, so as the different sources of income that can use such businesses. (Yes, it's in English ... but this class impart English).

Types of business model

I hope the information is useful to you.

Here you find the article that the authors of "4C" explain their model: “4c” Business Model Archetypes

We're going talking.

Kisses.

Google launches into Wikipedia

Wikipedia is in danger. Google has just released a new project that aims to unseat the siempre_presente_en_todas_las_búsquedas: Wikipedia.

The new project is called Knol (http://knol.google.com/) And it is in beta.

And it is that Google does not want to be left behind in any of the fronts on which Internet progresses. While already leading the search, free email, maps, calendars, etc .. and now wants to also lead the online dictionaries.

Knol aims to be Google's response to the phenomenon Wikipedia. According to Google itself, the name comes from the word "knowledge" in English: "knowledge" and it will be a database of knowledge, self-feeding like Wikipedia, but with tighter control of the content published.

One of the main differences between Knol and Wikipedia is that Knol articles will sign experts may include a photograph in their chips expert and will have a profile where the feedback of users of these authors appear. The structure of the articles, on the other hand, will not vary much from the Wikipedia offers.

For now carry 1,285 published articles and is only available in English. We'll see what it takes to reach 4 million Wikipedia articles ...

Discover the 3 reasons why Microsoft enters the market of ads search engine

Microsoft announced last week that it had developed its own set of text ads on search results MSN Search. According to Microsoft this system is much better than its rivals Google and Yahoo as it will serve ads based on gender, age and location of the user.

There are three clear reasons why Microsoft is conducting this movement:

  1. For Microsoft, Google is becoming a real threat. Thanks to the revenue that Google is getting its adwords, they are funding many initiatives in the field of programming with free software and applications that have little to do with Windows and compete directly with Microsoft products, such as Gmail vs. Hotmail.
  2. It is obvious that the market for text ads included in search results is a great source of income. Google is a living example, has announced a net profit of 342.8 million dollars during the second quarter 2005.
  3. In a way, for some years, MSN has been forced to share revenue with YahooOne of its main competitors. Until now, the ads MSN offers on its website are offered by Overture, a company that since March 2003 belongs to Yahoo, so Yahoo gets a commission for each sale of MSN.

According to Microsoft the service they offer will be much more attractive than Google and Yahoo for advertisers because it will provide segmentation by gender, age, location, user, time display ads and other parameters that Microsoft knows about its users.

Microsoft has been latecomers to the world of search engines, but it looks like it is doing completely, but step by step and not risking.

MSN Bot

El primer movimiento fue en verano 2003 momento en que lanzó su recién programada araña MSN Bot a escanear toda la red, cuando en sus portales aún utilizaba el buscador Inktomi (propiedad de Yahoo desde ese mismo año y por el que Yahoo pagó 235 millones de dólares). Durante 2003 Yahoo ingresó gracias a MSN 5,3 millones de dólares por el uso de su buscador.

A mediados del 2004 Microsoft lanzó la versión beta de su propio motor de búsqueda y a finales del 2004 dejó de utilizar definitivamente Inktomi, para pasar a ofrecer sus propios resultados de búsqueda. Desde entonces lucha por posicionarse entre los mejores portales de búsqueda. Aunque el mejor activo de MSN Search no es su algoritmo de ordenación de resultados (como lo es en el caso de Google) sino el hecho de que muchos de los usuarios de Windows no saben cómo cambiar la página de inicio de sus navegadores de Internet, ni tampoco cómo cambiar el motor de búsqueda que el MS Explorer lleva instalado por defecto. Así que no es de extrañar que MSN sea la web número dos del mundo en tráfico (la uno es Yahoo, la dos MSN y la tres Google).

After getting your own search engine, the next logical step is to exploit Microsoft itself the economic potential offered by search engines and that Microsoft has failed to see until Google and Yahoo have been presented every year positive economic results.

It seems that the first sites of Microsoft in testing this new ad system will MSN MSN Singapore and France. Then, it will spread to other countries.

We will be watching when this occurs, to perform segmentation and analysis of acceptance and subsequent expansion of the MSN network of advertisers.

Links:

Alexa Ranks (http://www.alexa.com/site/ds/top_sites?ts_mode=global&lang=none )
World Ranking Web by number of visits and page views.

Learn how the Internet has affected the Porter 5 Forces

Internet has changed some of the bases that Michael Porter started in 1980 when he published 5 Forces involved the success or failure of a sector or a company.
Michael Porter
Over recent years, Porter has been modifying and clarifying 5 forces. In this article we will see how they have evolved to adapt to new times.

Michael Porter will be in Spain during the 12th and on May 13 giving a lecture under Expomanagement Madrid 2005. It will be an excellent opportunity to see first hand their views on the changes that the Internet is occurring in our economy and moment forces the move.

What are 5 forces of Porter?

In 1980 Michael Porter developed this method of analysis in order to discover what factors determine the profitability of an industry and its companies. For Porter, there are 5 different types of forces that mark the success or failure of a sector or a company:

  1. The rivalry between competitors
  2. The threat of new entrants into the market
  3. The threat of products that substitute to ours
  4. The bargaining power of buyers
  5. The bargaining power of suppliers

When the analysis of Porter's 5 Forces used?

  1. When you want to develop a competitive advantage over your rivals.
  2. When you want to better understand the dynamics that influence your industry and / or what your position in it.
  3. When you analyze your strategic position and looking initiatives that are disruptive and make you better.

But the Internet has changed some of the bases from which Porter started in 1980 for each of the 5 factors. Porter himself, over the years has been modifying them and adapting them to today's world.

In this article we will discuss 5 forces and see how the Internet has changed the rules of the game and what we should consider if we want to continue to use this type of analysis.

1. The rivalry between competitors:

Porter focuses on developing its recommendations differences between our products and those of competitors, to avoid falling into competing on price, a strategy that ultimately end up affecting the profitability of both companies.

  • Pero Internet ha permitido que realmente se puedan reducir los costes en empresas cuyos costes están relacionados con la comunicación, con la recepción de información o con la concertación de transacciones. Así que una gran parte de las empresas que han sabido aprovechar las ventajas que les brinda Internet y la tecnología asociada a la red, acaban pudiendo ofrecer precios más bajos y por lo tanto, compitiendo por precio en su mercado. Ante un mismo producto, con dos precios diferentes, la fidelización del cliente sólo influye en la pequeña cantidad de diferencia de precio que el cliente tolerará antes de abandonarnos e ir a la competencia. Internet permite que la rivalidad sea por precio, sin que esto lleve a una guerra donde no haya ganador.
  • Internet has also made appear on the market many products that were previously only intended for a local market, so even if our product was unique in our market, now appear identical products to our ... so again just competing by price .
  • La relación entre competidores ha cambiado radicalmente con la globalización de los mercados. Los clusters locales especializados en la producción de determinado producto o servicio, hacen que la relación entre empresas competidoras sea colaborativa, con objetivos con miras a desarrollar juntas tecnologías, investigación que hagan subir la productividad y la innovación de las empresas que participan en el cluster. Silicon Valley y Hollywood son los clusters más famosos, pero existen cientos de miles de clusters locales que han cambiado radicalmente la relación entre competidores.

There is information on the effect of local clusters in the relationship between competitors in various articles published by the same Michael Porter. At the end of the article we quoted one.

2. The threat of new entrants:

The threat of new entrants to enter our market is higher, when barriers to entry are low, when companies involved in a market do not want to fight the new players and when a new player has high expectations of profits if it goes into the market. So Porter advocates increasing entry barriers in a market. Their recommendations are as follows:

  1. Take advantage of economies of scale to lower costs
  2. Create differentiated products and patent them.
  3. Develop the brand image of the company, for customers to them more difficult to switch brands.
  4. Close access to distribution channels.
  5. Have restrictions for new players, dictated by government institutions.

But…

  • Este modelo es válido para mercados estáticos. Internet ha propiciado multitud de mercados dinámicos que no permiten aplicar las recomendaciones de Porter. La consolidación de las empresas puntocom supervivientes al crac del 2000/2001 han cambiado los modelos de negocio y las cadenas de valor. Las puntocom han destruido eslabones de la cadena y han creado nuevos escenarios competitivos en los que han sido aplicaciones asesinas de muchos servicios ofrecidos hasta ese momento sólo por el mundo offline (ejemplo: las bolsas de trabajo online, las páginas web de clasificados de compraventa, las subastas online, etc.).
  • Network externalities, on the other hand, lead to the creation of natural monopolies because they generate positive feedback processes that make each new user of a service it has more value for the next user.

3. The threat of the development of substitutes:

Porter is considered a substitute of another product, only if you replace a product of a different industry sector to yours. For example, the price of aluminum beverage cans, is based on fluctuations in the price of glass bottles and plastic bottles. They are substitutes packaging, but are not rivals coming from the aluminum packaging industry.

  • La tecnología cada vez más permite la generación de nuevos negocios que hasta ahora eran impensables. Los cambios tecnológicos radicales que estamos sufriendo no permiten realizar ningún tipo de predicción ni análisis previo sobre este punto. Por ejemplo, pensemos en el mercado del ancho de banda: tenemos las conexiones vía cable telefónico, vía satelital, vía red eléctrica, etc… todas aparecidas y desplegadas en un espacio de tiempo relativamente corto. Se hace difícil poder prever y contrarrestar los efectos de este tipo de productos. El usuario cambiará tan pronto como perciba que el coste del nuevo producto es más bajo o cuando obtenga nuevas funcionalidades.
  • Internet also enables other ways to meet needs and functions, creating new and unimaginable substitutes.

4. The bargaining power of buyers:

For Porter this threat must be neutralized with an appropriate strategy to pursue this end.

  • The truth is that thanks to the Internet, customers increasingly have more power. Although it is seen from the point of view of the traditional company that is not exactly positive:
  1. Internet increases the information on products and market reality.
  2. Increases the bargaining power because it provides more direct routes and eliminates customer links in the distribution of products.
  3. It provides an unbeatable consumers to join and perform lobbying against certain companies when customers are dissatisfied frame.
  4. To better understand this point I recommend reading the summary of the conference by Philip Kotler at the World Forum of Marketing and Sales (Barcelona 2004): The 10 principles of "new Marketing

5. The bargaining power of suppliers:

Porter focuses the analysis of this point by remarking that the power of suppliers depends on the importance of them (think of providers who have captive market for example .: Telefónica, Microsoft, etc.).

  • The current trend is to treat suppliers as business partners, and share with them the ultimate goal of meeting the needs of our customers. The customer-supplier relationship is changing.

Although all qualified in the comments at 5 forces suggests that the Internet has forced companies to compete on price, the Internet has also led some of them have achieved great success in their differentiation strategies. These companies are the companies that are strong in:

  • Scientific investigation.
  • Product development teams with talent and creativity.
  • Sales teams with great communication skills and awareness of the needs of a changing market.
  • Brand image that conveys innovation and quality.

But the risks associated with differentiation have also been magnified by Internet:

  • Imitation of our products by others that have not invested in R & D.
  • The changing and unpredictable tastes of customers.
  • So to round off the article I say that the Internet has made the analysis of Porter's 5 forces still remain valid today, is much more complex than it was and with many more variables to consider.

Related information

Article by Michael Porter on Local Clusters.
Harvard Business Review: Local Clusters

Article summary of the conference about the New Philip Kotler Marketing and increased consumer power. Philip Kotler: the 10 principles of "New Marketing"

Information about Expomanagement, Madrid 2005, where Michael Porter will lecture about the results-oriented strategy:

  • The results-oriented strategy
  • The economic logic of higher returns
  • How to recognize what kind of business your company competes
  • The importance of abandoning the destructive competition and adopt strategic competition
  • What are the five keys to an effective strategy
  • Why most companies have no strategy
  • How to find the right strategy
  • How to successfully communicate and implement a strategy: essential steps

http://www.expomanagement.es/congreso/congreso.html

Why free content raises the billing? (OGame)

We all know, giving value for nothing is one of the best weapons to succeed online. If you can provide a good percentage of your free service without this just your results having a positive impact on your business will suffer.

Algo que los que llevamos años creando negocios en Internet sabemos a ciencia cierta, no es siempre fácil de explicar a terceros. En charlas y clases veo caras de escepticismo cuando tratamos este tema. La gente se pregunta ¿Cómo puedo ganar dinero ofreciendo cosas gratis?, o piensan que si das parte de tu contenido o lo que sea, gratis, mal acostumbras a los usuarios o piensan también que estás devaluando tu imagen… nada más lejos de la realidad. Pero ¿cómo se lo explicas para que lo entiendan?

The explanation is simple: the viral marketing that generates something free is much higher than can be generated with a payment product. So if you are able to transform users coming to your site into customers, you have the game won.

For several days, I have new arguments to convince my students ...

oGame

If there is something that I love are the games ... and of all the games, strategy games. Since early January 2005, I'm playing oGame (http://es.ogame.org) A strategy game framed within the genre of massively multiplayer games turn (turn based massive multiplayer game). It is being played by the web, without requiring software installation. Typical game of colonizing planets (note for those over 30: is like the VGA Planets shifts but without sending email). Is free. It's addictive.

Right now we are more than 7,000 players playing in the same game.

I've been analyzing the growth of oGame since I joined him. Can anyone guess growing daily as the number of players?

The number of new players daily grows 6%. Daily!!

Can you imagine a business to grow at a 6% daily geometric?

Well ... certainly hard to imagine. In this case would be considered cheating OGame is a business. At least as far as the Spanish version is concerned. The German and English versions, and water are another matter.

Administrators of the game (German) so far have ruled the Spanish market. The business model for the other versions is as follows:

Business model: selling advertising on the German community and English version of the game + pay no advertising and more features that facilitate the organization of your strategies.

Advertising in the Spanish version exists but is minimal, poorly segmented, is by pop-up's (with which you can skip the all if you want) ... and worst of all ... it's all in German. Hence my assertion that the Germans have decided not to exploit the Spanish market at the moment.

But back to what interests us in this article. How to prove to unbelievers that offer something free, you end up doing the billing?

Consider the growth of the game:

El secreto está en la estructura de red que está detrás del juego. No es propiamente una red de Metcalfe (para conocer qué es una red de Metcalfe leer: Análisis del “Por qué eBay (y posiblemente Google) abren su código fuente a los desarrolladores”. Si analizamos su crecimiento veremos que no sigue una curva potencial típica de las redes de Metcalfe (crecimiento=número de usuarios ^2). Tampoco sigue la curva de crecimiento de una red grupal (crecimiento=número de canales ^usuarios), sino que es una especie de mezcla de ambos, que acaba mostrando una gráfica parecida a la curva de implementación de una nueva tecnología, la hype curve de Gartner (ver imagen adjunta). Es decir, primero sufre un crecimiento muy fuerte (en enero llegamos a un crecimiento de un 15% diario), luego baja de golpe, y acaba por estabilizarse un poco más arriba de los mínimos en los que ha bajado (al 6% diario que estamos ahora).

OGame viral marketing also works as a network of contacts ... small explosions as the recommendation is coming to small groups of friends or communities. Hence somehow it ends up showing a curve that combines the group growth with the growth of networks Metcalfe.

Anyway ... just a steady growth of 6% daily. These are many new visitors to a web page daily. Many more than we can attract with any marketing campaign, search engine indexing, advertising in Adwords, ... or anything that we can devise to increase visits to our website.

Again, I repeat, the secret is in knowing the views convert into customers. And that if the viral marketing or free content, and have nothing to do. They have already fulfilled their mission: bring users to the page. Here only consider our ability as business managers.

How do we convert visitors into customers?

This longer be the subject of another article. But not to leave readers dissatisfied, commenting that there are several models:

  • Online games: Offer a pay version of the game, with more functionality without micromolestias such as advertising. This is the model chosen by German managers ogame for their other communities.
  • Sites selling content: Offer expanded and better quality content, but by the same authors, for a reasonable price.
  • online marketplaces and classified: Offer a package of value-added services to complement the services they receive for free all users, but we know from interviews with some users, some of them would be willing to pay for. These packages can deliver advertising its products, more visibility, extra features, etc.

There are more models, but as I said before, the subject deserves a separate article. The important thing to remember is that there is no better way to attract users to your website that offering free content to generate viral marketing at speeds hyperlumínicas ;-)

Related links:

oGame: http://es.ogame.org

Article about networks Metcalfe: Metcalfe networks

Power Point presentation about the networks Metcalfe: Metcalfe networks