Monday, December 12, 2005

If you send them away, they will come back.

I just love this post of Dave Winer's about how to many money on the Internet. In short, the best thing you can do for your visitors is send them away. What does Google do? Sends people away from Google, more efficiently than anybody else. How about Yahoo? What did adding RSS support do for Yahoo? Drastically increased their share of the online news market. Why go to CNN, MSNBC, etc... when you can go to Yahoo and then Yahoo will send you to those places? Who are the most popular blogs? Those that link the most. Even basically puts a little value add on top of what is just a link to somebody else.

I think the underlying lesson is in knowing your strengths, and not fearing competition that is not really there. Yahoo is not a source of news, after all. Nor is Google a source of answers. Both are merely pointers. That is their value. So in order to be the most valuable pointer to things, you have to be willing to point to everything in an unbiased manner. If you pick and choose what you point to, or how you provide your results, then you'll lose value because you're basically saying that you don't trust the customer to come back to you. You're trying to force them into something. They'll spot it in a heartbeat, and you've already lost them.

The new business model appears to be "Look, here's the value I offer. I realize that other sites are valuable to you in a different way. They are not my competitors, I am not worried if you go over there. In fact, I encourage you to do so. Come back when you need me." Certainly you want to add value on top and not just be a list of links -- those have been around since the dawn of the net. Anybody and everybody can do that. You still need differentiators. You need a reason for your customers to pick you over somebody else that does exactly what you do. Maybe if you're a blogger it is in your personal writeup style. Or maybe the way you pick and choose your links for quality. In the case of something like a Google, it's the efficiency and relevancy with which they provide your results. And delicious' value lies in the wisdom of crowds.

I can only daydream about getting myself into a position where I can make money like this. But it's fun to think about. :)

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