• What’s the big deal about Web 2.0?
• Why does the world need Web 2.0?

Web 2.0 is the current flavour of the month in the online world. Businesses, start-ups and established corporations are embracing this new trend like, well, Web 1.0 circa 1999. What can Web 2.0 offer your business? We will explore three somewhat overlapping aspects of Web 2.0 and discuss its impact on organisations.

There are three “spheres” of Web 2.0:

• Technology Architecture;
• Business Models;
• Aesthetics.

What drives the business model for a company to establish a Web 2.0 project? It’s about communication. The simpler the communication method, the greater the capacity to communicate more effectively, which inevitably leads to more people sharing knowledge. We have seen the explosion of user generated content, such as You Tube, MySpace and Flickr. Companies are now moving towards “employee generated” and “customer generated” content. Instead of managers and the executive writing “top-down” directives, we may see the emergence of “bottom-up” policies and ideas emerge and discussed from staff and “lateral” policies introduced from the macro data of customer experiences. Of course, the cultural aspects of the organization needs to support such open discussions and this level of workplace democracy for this to work. This also includes engaging with your customers in an open dialogue and be prepared to hear their opinions: good and bad.

But haven’t we heard this all before? Didn’t IT knowledge platforms of the past from Lotus, Microsoft and the myriad of other software providers going to help knowledge sharing and customer satisfaction? Yes, they did help. But as employees become increasingly comfortable with consumer oriented Web 2.0 websites the more they become familiar with both the culture and technology tools that aid knowledge sharing. Similarly, customers now expect companies to have online forums and blogs and be intimately involved with the brand and product experience- thereby increasing their loyalty.

So what is the software platform that enables Web 2.0? In simple terms, the software architecture of a website consists of a database (where raw data is stored in logical groups, eg. user login details), the code (which communicates with the database and decides what is displayed on a particular page) and the presentation (or the “look and feel” of the website). These are separate modules that communicate with each other. For example, if we change the presentation or “look and feel” of a website we don’t have to worry about changing the structure of the database. This means we can have database designers working on the database structure, the coders working on the programming and the graphic designers working on the presentation of the site. Of course, there will be interface points that need to be managed but by separating these three basic layers allows innovation to prosper in each layer as a specialist can develop solely for a particular layer and not have to worry about the other. For example, it is unlikely that a database programmer will have the artistic flair of a graphic artist designing a website’s “look and feel.”

You have probably noticed that new Web 2.0 websites like, YouTube, Flickr and the myriad of blogs out there, somehow look different. Bolder, cleaner, gradients, bigger text and less cluttered. Screen elements can be resized and buttons fade. The technology fuelling this innovation is AJAX (Asynchronous JavaScript). We won’t be going into its details, but the key message is that AJAX is helping improve the look and feel and more importantly the usability of the web. By usability we mean that the web user experience is moving towards what we expect of PC software (eg. Word, Outlook etc.). Think of it as having the best of both worlds – the user experience we expect from PC software coupled with the power of being online via your web browser.

The other important technology, XML (Extensibile Markup Language) is a common language that allows software (be it on the web, PC or mobile) to communicate with each other. So by having that common format, data can be exchanged and presented in unique ways.

So how can Web 2.0 “aesthetics” help corporations? One of the key problems facing executives is the real time reporting of what state their organization is in. Revenue, expenses, customer satisfaction, burning issues, media and PR “buzz.” In most cases, the information is there; in fact one can argue that there may too much information. The trick is to turn information into knowledge (and hopefully knowledge into wisdom!). Web 2.0 technologies can be used to distill information into dashboard objects – charts, dials, bar charts etc. For example, below is a snapshot from Salesforce.com’s analytical dashboard:

Note the wonderful, colourful snapshot of the organization an executive can get and cut through the information “clutter.”

Concluding remarks

As with all new corporate technology, it’s important to have realistic expectations about what it can achieve. If you want a knowledge sharing blog make sure you have a knowledge sharing culture first with your customers. Want a great executive dashboard? Make sure you have a visually creative development team that can transform your old boring spreadsheet data into an imaginative array of dashboard indicators to help you, at a glance, get a hold on how your organisation is performing.

3 Fundamentals of Online Advertising

First a refresher. There are 3 basic ways to advertise on a site: 1) Cost per 1,000 impressions (CPM), 2) Cost per Click (CPC) and 3) Sponsorship

Cost per 1000 impressions (CPM): This is the amount charged to an advertiser per 1000 views of an ad. Rates generally range from $30-$50 per 1000 impressions.

Cost per Click (CPC): This is when charges are only accrued when a user click on the ad which takes them to your website. Rates for these generally range from a few cents to a couple of dollars. This sort of advertising is popular with search engine companies.

Sponsorship: This is generally based on a finite time-period (e.g.. for a fantasy sports competition) or for a specific event (e.g. an email campaign to your customers). Generally, these are secured through your existing business relationships or managed via a PR/advertising team.

(UPDATE: Google have just announced a trial where advertisers only pay when a specific action is undertaken online. For example, you only pay when a customer who clicked on your ad then goes and purchases a product or submits a contact request. Read here for more details.)

4 Online Advertising Revenue Models

1. Share Advertising Revenue with your Contributors

The big trend that is generating a lot of interest is consumer generated media served from a central, well-branded website. Think YouTube, MySpace, Facebook and Flickr. These are sites that de-centralise (some say democratise) the process of creating content and placing the power back into the hands of the individual. This process is important because it is incredibly popular. Being popular means happy advertisers.

But what of smaller, niche sites such as blogs and forums? How can they compete with the big boys? As we have mentioned previously in our technology reviews, content is king. Focus on getting the right content for your audience. High quality content gets you loyal visitors. A niche market means that advertisers can target their message carefully. Focus on getting high quality content for a niche audience and advertising will follow.

So it begs the question – “How do I get great content?” One way is to pay experts to write about their industry, or build a great brand (see our article from Pandemonium for tips) that attracts experts. The other option, which offers some promise, is sharing advertising revenue with your writers. This is where YouTube, MySpace and blogs will head in the future.

Sharing advertising revenue with your writers/contributors works like this. Assume you have advertisement running on your website and you are using a cost per 1000 impression (CPM) model (See earlier discussion on CPM). Now, when a visitor reads, watches or listens a contributors’ content, the ad is displayed next to it. In normal run of events 100% of the ad revenue from that ad goes to the website operator. In the ad revenue share model, a cut (say 20%) will go to the contributor.

The great thing about this model is that it is self-correcting. A popular contributor will be encouraged to continue submiting more content because they are getting rewarded. A less popular contributor will be discouraged as they are not relating to the audience. Thus, the “cream rises to the top.” and thus improves your website’s popularity with your audience.

2. Podcasts

Advertising strategies for podcasts are more or less borrowed from their traditional media counterparts, radio and TV. Typically, short ads (less than 30 secs) are inserted into the start of a podcast. Again, subscriptions to podcasts can be tracked although it is a little harder to actually know how many people listened to it (SONAR recently released a media player that can track this sort of information).

3. Really Simple Syndication (RSS)

Really Simple Syndication (RSS) gives users the power to subscribe to a website’s news, new articles and new content. For example, this blog has an RSS feed. RSS feeds can be sent to a dedicated RSS Feeder (such as FeedDemon) or viewed on your personal Yahoo/Google homepage. It’s a great way to keep in touch across a number of websites without actually having to visit them - which is why they are very popular. Now this could be a website operator’s worst nightmare as the number of visits to your page could be threatened by this technology. However, RSS feeds can have advertisements embedded within each feed, thus providing a extra source of revenue. New ad service companies, such as FeedBurner, help website operators to embed advertisements in their feeds.

4. Google Adsense vs Yahoo! Publisher

One cannot talk about online advertising without discussing what the big players, Google and Yahoo! are up to. For the uninitiated, Google have a system to help customers earn revenue on their website, called AdSense. Google AdSense automatically serves advertisements (by you placing a small bit of code on your website) and will automatically display ads that are relevant to your website. When a user clicks on an ad, you get a share of revenue and Google gets a share.

The online world has been waiting for Yahoo!’s response to AdSense. Yahoo! offers an invite-only, BETA system called Publisher Network.

It is worth considering Google or Yahoo! Services to manage your advertising on your site. It’s very easy to set up either service and requires little management overhead.

Last Word

Using a mix of the above online revenue models can boast your site’s earning potential. But as with any media, it is important to understand who visits your site. How many unique visitors per week? What locations (country, state, city) do your visitors come from? What are the general demographics of your visitors? These are the basic questions that any advertiser will want to know. Create a media pack with all of your demographic information, rates and technical (size, format etc.) specifications. Make it as easy as possible for an advertiser to say “Yes” to advertising on your website.

1. Corporate Search

Generally speaking it is easier for people to find information on the web than it is on their own corporate intranet. Finding the right documents and information quickly and without having to trawl through various directories and database is a must. We will continue to see companies battle it out in the corporate sector. Not surprisingly, Google, have an enterprise solution where a Google-designed server is simply plugged into the intranet and goes to work indexing documents. Two industry heavyweights, IBM and Yahoo! have teamed up to introduce OmniFind, a software-based enterprise search solution to compete in the corporate market. 

2. Location, Location, Location

With the rise of mobile phones, wireless hotspots and GPS, users will demand location-based search. Although we are in a globalised economy, people are yearning for that sense of local community. Look out for the major search engines to push “local search” (Eg. Yahoo! Local). Also watch out for mobile enabled search with the capacity of searching local businesses and even “finding a friend” in a crowd.

Sensis.com.au claims to enhance their search by integrating their Yellowpages, Whitepages, CitySearch and TradingPost assets to serve up local results. Businesses will be (and already have) begun to take a localized approach to advertising, rather than a “shot gun” approach characterized in the early days of online advertising.

3. Business Linkages

Have you ever tried to find a business partner via the web? Currently, search engines allow you to find companies, but not the right person in that organization to contact. This is where search and social networking will merge. So in the future, we will see a lot more business linkages between key decision makers within companies. A great example is LinkedIn, where you can search through and get introduced to a range of professionals from around the world. It’s not one big marketplace, where anyone and connect to everyone. You still will need to use your online network to establish contacts, just like you would in the physical world, to facilitate business connections.

4. Video and Podcast search

With the emergence of multiple forms of media out in the web, consumers will demand easier search of non-text based information. There are search engines that specialize in video and podcasts but they only search the “meta-data” (that is, information, tags and categories that accompany the media). Future research will focus on the search of the actual content of the media, by analyzing the media stream, extracting relevant information and keywords, index it and make it searchable. If this is achieved, this will help both the producers and consumers of content to connect to one another.
 

Final Thought

Humans have and always will need information. We will always place a premium on finding it.  But let us not confuse information with knowledge, nor wisdom for that matter. Knowledge and wisdom will continue to remain the defining human advantage over machine. So be it.

Yahoo!’s original strategy

In the beginning, Yahoo! started as a student hobby by David Filo and Jerry Yang, who in 1994 decided to keep an online list of interesting websites. As their list grew, they decided to put those links into categories, and sub-categories, and so on. This is important as this dictated their general approach to advertising – businesses pay to be listed within a certain category. Think of early Yahoo! as the YellowPages of the Internet world. Over time they developed search algorithms to trawl their listings (and then the web at large) for interesting websites.

Google’s approach

Like Yahoo!, Google was spun out of Stanford University by two PhD students: Larry Page and Sergey Brin in 1998. Their approach was to not to categorise websites but to rank them based on their popularity. On a basic level, website’s popularity is based on how many other websites link to them. So the more your website is linked by others the more popular you are and thus your website will be ranked higher than others.

As Google’s search engine evolved, their algorithm ranked “main stream media” websites (eg. News.com.au or cnn.com) as having higher quality content. So if your website is linked from these high quality sites, your ranking improves and you start to shoot to the top of Google’s search rankings. User’s found that Google’s method of indexing and ranking websites extremely useful in getting to relevant information on a consistent basis.

How do you get onto search engines?

There are a number of strategies to improve your website’s “popularity” ranking on search engines.

1. Content is king

Many people focus on “tricks” to fool search engines. Your primary strategy is to continually improve your website content. Make your content so interesting and so compelling that other website operators and bloggers want to link to you.

2. Write articles for the main stream media.

This is easier said than done. But take any opportunity to write opinion pieces or give interviews to the main stream media. Get them to provide a link to your website. The search engines will give your website a boost.

3. Participate in online forums

Find online communities in your areas of interest. Participate, but don’t “spam” your message. Make sure your website or business solves a need that is being discussed in the forum or blog.

4. Meta data

Make sure that you include meta data and meta tags to your website. This “meta” information helps search engines understand the content of your webpage and thus helps connect searchers to you. Ask your website operator to make sure that these are up to date and relevant to every page of your website.

5. Free press releases

There are a number of free press release services out there. Do a Google search for them. It’s one way to promote your site and getting links to your site.

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