Greg T. Spielberg

Archive for May, 2010|Monthly archive page

“And do you believe in ROI? Can click through keep your eCPMs high?”

In Journalism Economics on May 25, 2010 at 9:29 pm
The only problem with an Internet handle is tracking down the person behind one. LMcDuff08, an “experienced Wall Street banker” created this video and sung to the tune of Don McLean’s American Pie. It’s ingenious. Lady McDuff is the name of his dog, which reminds me of a valuable Businessweek community member I remember from last year. Holly Garfield (who, like LMcDuff08, seems to be in his late 40s), combined the name of his cat — Garfield — with the name of his dog — Holly.

Thanks to Raghu Thricovil, a Ross
MBA aspirant who has this video on his blog.
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In the battle from grouponomic supremacy, go upmarket

In Grouponomics on May 22, 2010 at 4:44 pm

I purchased a $55 dental clean through Groupon, and, in awe, I wrote about the “temporary brute strength” that grouponomics provides. I didn’t realize that Groupon takes 50% of a business’ revenue as part of the deal. That fact floored me, and I thank Bundle Managing Editor Janet Paskin for the details. She did some great reporting on the emotional pull of grouponomics in her story “Inside the Cult of Groupon.” Steven Carpenter broke down Groupon on Tech Crunch earlier this month, too. I have two takeaways from my experience and their articles and two next steps:

Takeaways
1) From the customer end, there’s not much brand differentiation. I am equally happy about Groupon’s $55 dental clean and kgb’s $4 movie tickets. Both provide me with 65% savings off the typical retail price. As Carpenter writes, “buyers don’t care where they buy so long as the deals are good.”

2) The giddiness of participating in a timed, tipping-point-based sale will wear off for customers. For me, it never existed. As Carpenter shows, the average savings provided by Groupon deals in the five US cities he looks at climbed from $43.79 to $78.37 between Q4 ’09 and Q1 ’10. My guess is that this 79 percent growth in savings is the catch, rather than the emotional attachment. (Not a mind-bending conclusion, I know, but it makes design and branding elements seem fairly irrelevant.)

Next steps
1) Upmarket competitors. Carpenter found that “Boston residents love laser hair removal,” “St. Louis residents love their plants and garden supplies,” “San Diegans are into Pole Dancing,” “Denver loves them some Cold Stone Creamery,” “Atlanta is into NASCAR,” and Chicagoans enjoy the “Tall Ships.” With the exception of the Tall Ships — sailing on old-school ships, essentially — we’re looking at deals on low-market experience and products. My $55 dental clean stuck out because it’s a high-quality product, and I purchased it right away (I go next week). While Groupon, Living Social, kgb and the rest slug it out to provide Denver with ice cream deals, who’s going to jump in on more meaningful products and services?

2) International shipments. Right now, grouponomics is city-based. What if it become nationally based? For instance: A startup company in Greece creates a brand-new electric bicycle that’s not drawing VC money, no family money, no government money, nothing. Grouponomics 2.0 offers the electric bicycle to the entire United States and puts the tipping point at 3 million people or 15 million or 20 million. Grouponomics 2.0 acts as a public VC firm that helps offer the brute strength of economies of scale to a startup. I feel that this is inevitably next after up-market grouponomics 1.0

To read the short synopsis of Paskin + Carpenter, go next door to my story on Bundle.
For a good-looking story about Groupon by U. Chicago Ph.D. student Evan Miller, go down the road to his blog. I haven’t read it yet, but look forward to.

A problematic resource in community economics: Relationships

In Community Economics, community-supported fisheries on May 17, 2010 at 3:57 pm

I wrote the first part of a series on Walking Fish, a community-supported fishery run by Duke’s Nicholas School of Environment. Walking Fish has two delivery seasons — 12 weeks in the Fall and 10 weeks in the Spring. When talking with Josh Stoll, a conservation fellow at Duke, a few things stuck out.

1) A fishery only deals with one fish. I had always thought a fishery was a company, that like a company, could do business in a handful of products. Nope — fishery = 1 fish.

2) Josh stressed how important relationships are in the Walking Fish model. We didn’t get too specific in how they worked, but he did say that one of the problems Walking Fish faces is the high turnover caused by graduating students (he’s one). While Walking Fish will always be staff for free, or cheap, by students, the relationship bonds between the CSF and the community will continually be broken.

My guess is that this CSF and models like it will have to do one of two things: Hire a permanent community manager so that the local community keeps its consistent tie with the Duke community; or, pull in a few members of the local community. Walking could have a community manager at the Core Sound end (where the fish come from) to work with the fishermen and the transport drivers. A second manager to run the drop-off point and weekly purchasing table. A third community manager to stay in touch with clients in the area as well as restaurants who purchase from Walking Fish. Watt’s Grocery, a nice-looking restaurant in Durham already does this.

For the Walking Fish story and to read why its business model is like a mullet, go next door to Bundle.

Who knew? MBA prep companies are hella social

In MBA on May 11, 2010 at 6:24 pm

Bell Curves is on Twitter and Facebook. You can visit their blog or engage a comprehensive batch of practice questions.

Kaplan GMAT Prep is on Twitter and Facebook. You can visit their blog and YouTube channel. Kaplan has two iPhone apps: The Portable GMAT app is $7 and reviews strategy, questions and explanations. Kaplan’s GMAT Flashcards app is $5 and offers test questions as well as explanative videos.

Knewton is on Twitter, Facebook and Tumblr. You can visit their blog or YouTube channel.

ManhattanGMAT is on Twitter and Facebook. You can visit their blog or YouTube channel. ManhattanGMAT also has a free iPhone app, MGMAT Flashcards.

Manhattan Review is on Twitter and Facebook. You can visit their blog or YouTube channel.

Princeton Review is on Twitter and Facebook. You can visit their YouTube channel.

Veritas Prep is on Twitter and Facebook. You can visit their blog or YouTube channel. Veritas has two free iPhone apps, Practice Quiz and Admission Predictor.