Part 6: Get beyond the buzzwords– build enginets that will weather the times.
SHAHAR: True. Just one more point that I want you to talk about. You talked about programming, the activation process, the motivation, now the differentiation. Tell me how to apply that to the business today how can we apply that to our online environment?
JIM: Well, you can actually see them on our website. These are lens’ that I use through which I consider any web development work. And anybody can come up with their own list.
I used to say that the internet was this great commoditizer because it lowered geographic barriers and demographic barriers. It lowered it all and once something gets out there it’s really easy to commoditize, so you have to ask yourself “what can’t be commoditized?” And anybody can do this methodically, they can go through it and come up with their own analysis —but what I came up with in terms of differentiation was eight things that can’t be commoditized. It just can’t be done. One of them is Customer Service. If you have great customer service, that’s going to differentiate you from others and it’s going to collect everything from how you treat the customer, how the site works, you know, how easy it is to do things. So that’s one of the things that will differentiate you forever on the internet. Another one is entertainment, and we just talked about diversion. So if I’m going to be entertaining, I’m going to be able to capture, all the time, more of somebody’s disposable time. Things like “first in” are often a differentiator—you know, being the first in, the first, best at something? I don’t know if you read “The Twenty-Two Immutable laws of branding.” That’s not where we got it, but it turns out that triangulates that if you can be best in something, or create a category that you’re best in—more often or not—
SHAHAR: Be the expert on a specific category.
JIM: Yes, so if you can do that, historically over the last 12 years, that has been a differentiator. If you can be the first best in something; Community of interest, if you can build a tipping point of the number of people, faster, better or even second to somebody. It doesn’t matter if you’re first in that case. If you can get to the tipping point, where whatever you’re first and best in, you get enough people to become self-sustaining site. It’s always going to be a differentiator. What else— ah, last standing. If you set yourself up so that last longer than anybody else that pretends to you’re throne, then that is traditionally going to differentiate. That was proven out in Spades during the dot.bomb. A good example was Atom Films—I don’t know if you remember Adam Films. But they merged with Shockwave, and they had enough cash and they cut down their staff and they lasted long than anybody else and they ended up selling for a quarter of a billion dollars to Viacom after they came out of the bubble burst.
So, I don’t know if I’ve named [all the differentiators] or not, but you can come up with your own list of things that simply cannot be commoditized and it doesn’t mean that you can apply every one of those to your engine and your online presence, or whatever you want to do in networked media. But it does mean that you should be asking the question “can we apply one of these to our site?” and if you can, you should. Does that make sense?
SHAHAR: Yes it does. Just one last question—I got an email the other day saying that we don’t need another social network because it’s overloaded with social networks around, what do you say to that? Do you think that’s true?
JIM: No, I mean—well maybe for different reasons than you might think. I think social networking is a feature, not a business. Just like I think E-commerce is a feature, not a business. Just like I think [every buzz word] you’ve heard over the last 12 years, they make it sound each time like it’s the be-all end-all. Auctioning or dating or social networking or what was the hot thing last year? Contextual advertising right? That was it. That was the business. Those were features, and they were not the end-all be-all and somebody can builds a business and sells it to somebody on a single “feature.” Which is find, especially for companies that can’t build them themselves. But every one of those clinical features has to become bigger than what it started out doing. So social networking is just one aspect of what these entities who started out as “social networking sites” need. They need to grow into something more “Google like”, or “Yahoo like.” Which, by the way, they are! Look at what myspace is doing, look at what Facebook is doing.
That’s why we call them engines, because every one of them is an engine with certain characteristics. Some of those characteristics might be commerce, it might be user generated content, it might be social networking, but there is a more whole animal that the industry and the press are just not talking about right now because they can only see the toenail of the elephant or the tail of the elephant “oh my God it’s about tails!” [Chuckles] They grab onto that, but they just can’t see the whole thing yet and five years from now, ten years from now maybe they will see that.
SHAHAR: But do you see this happening with only the advertising industry? Or is it happening to everybody? Don’t we all just see the toenail of everything that’s out there right now?
JIM: Yeah, I think it’s a bit of a chameleon though. Take the publishing industry versus the film industry. Everybody looks at the internet and they see themselves, everybody. So it doesn’t matter if you’re a retailing company, or a publisher or a film company, you all look at this as “hey, this is an extension of my business.” It’s a publishing medium, it’s a film distribution medium, and it’s a T.V. distribution medium. But that’s not what it is; it’s a superset of everything. Its networked media and it allows you to do everything. You can do storytelling or storyforming, you can do interactive or you can do linear. But the exalted form of programming in a networked medium is what you see or what you’re just starting to see—these engines of engagement. It’s a superset of all media and it isn’t usually used that way, it’s usually viewed in terms of the business or industry approaching it. Which isn’t unusual, you know, I mean even the film business looks at the T.V. industry as an extension of them—another place to distribute my movies. So it’s a very egocentric, self centered— that is, all businesses, necessarily I guess, are self centered. I think right now they look at it as an extension of themselves. But what’s ironic is that they have had no success, I shouldn’t say no success, they have had marginal success at attracting audiences to that media. So if you look at HBO, which is a great brand, an amazing programmer. They’re ranked somewhere in the 1,000’s, like 3,000 or 4,000 and so why can’t they attract a very large audience, very frequently and staying a long time at the HBO site when Facebook, or High Five, or Craig’sList can? Because HBO is not a networked media company; in fact, they just shut down most of their digital media group, a former colleague of mine was just there. They’re a T.V. company. They’re a cable company. And they seem to have decided to just be a cable company. But they’re being blown away—I mean they’re living off the power of their brand on the web, basically. They’re not really doing what the companies that are in the top 100 or 500 web engines in the world are doing. Does that make sense?
SHAHAR: Yes it does. Jim, if people want to know more about you, I already told them about your book on Amazon, but how—which website can they go to? How do they get in touch with you?
JIM: Well they can get in touch with us through Spectrumdna.com, which is our company site, but it is sort of a necessarily obtuse site. It doesn’t list our projects and all it does is talk about is enginetworking on a top level. But they can certainly send an email to jim@spectrumdna.com or they can go to the website and send an email through there and I’d be happy to talk to anybody who would like to talk about this. I think it’s important that our understanding of this new media be taught so that it can be repeated—the repeatability formula is the most important thing and that’s the mission, the primary mission of SpectrumDNA. And of course to make money doing it.
SHAHAR: Thank you very much for your time today. I told them to go to Amazon, and I looked there and you only have three copies there! Do you have another book coming?
JIM: I do. I’ve been asked to write a book on the nature of narrative and the age of networks. It’s talking about storydwelling and storyforming and how to apply that in business. So I’m considering taking the time out to do that, but right now I’m pretty busy.
SHAHAR: Well thank you very much for your time today.
JIM: Thank you, Shahar.
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