Doing Words

iTunes Festival could be a triumph… of email marketing

// July 1st, 2011 // 0 Comments // Content, Marketing, Music

In my email inbox this morning was an invitation from Apple to watch a live music festival in London starting tonight, my time. The festival has been running since 2007 but it’s been gradually morphing from focusing on attending the live event towards leveraging Apple’s extraordinary distribution pipeline to deliver to a worldwide audience. This year I think they’ve cracked it.

Via a dedicated free live event app you’ll be able to watch the three nights of performances from 62 artists, live or on-demand, free. And we’re not talking B-list bands here either, there’s Paul Simon, Moby, Duran Duran and Coldplay (yes, I’m that old).

As in previous years, tickets will also be available to attend the festival if you’re in the UK, and they’ll be available only to contest winners.

Could this be bigger — and more profitable — than Glastonbury?

From today you can buy the latest album from each artist performing from iTunes Store or from the app and I’m guessing that’s part of the reason why artist management agree to the concept.

The other reason, and the reason why the festival is most interesting, is the email marketing opportunity. Here’s why:

How many people do you know these days who own an iPod, an iPad or an iPhone? Lots, right? It’s not a static number either, it’s still growing fast.

If they’ve ever used iTunes Store to buy music, TV, movies or apps, Apple has their email address, and unless they’ve opted out, their permission to send them weekly emails about content for sale in iTunes Store.

No big deal, right? Every online retailer and content publisher has an email database. But this is an email database unlike any other, since it now represents arguably the biggest and fastest-growing entertainment content marketing database the entertainment industry has ever seen. There’s an iPod Touch, iPad or iPhone in the bag of nearly every person on the train with you, in the pocket of nearly everyone jogging in the morning. There might be as many Android phones out there as iPhones, or Kindles as iPads, but add up iPhones, iPods and iPads? Big number.

The music industry created the commercial radio industry to market new content to consumers, but never knew who those consumers were, what they listened to, and where they were at. Then, MTV added a little granularity for marketers, was able to provide some logbook data on audience size, viewing habits and geo location.

Today, businesses as diverse as Amazon, CDBaby, MySpace and Facebook have a database of content customers they can market to via email, but with nothing like the detailed purchase and consumption data Apple has access to. And not only does Apple have the biggest database of entertainment content consumers, they also own the whole stack, from bringing major labels and artists together for an event, to reaching an enormous global market of music consumers via email, to actually selling and delivering and tracking the consumption of the end content.

Analysts studying Apple’s market performance look at profit per device shipped, app sales volume, and PC and handset market share. Does anybody know what the open rates are on emails from iTunes Store? What their click-thru rates are? Perhaps Apple’s biggest untapped and unvalued asset is the ability to reach more of the world’s music fans than any other media publisher?

iTunes: what a truly global retailer looks like (yes, even in Kazakhstan)

iTunes Festival is a big endeavour, and while Apple is the king of hardware, it doesn’t yet have enough entertainment content culture in its DNA, so along the way there have been mistakes made, goals reached for but unmet, and lessons learned.

But Apple is also the king of execution — it learns perhaps better than any other major brand. This year you can watch the whole event from your iDevice of choice instead of on YouTube, and for the first time, you can watch in HD on a TV equipped with an AppleTV using AirPlay.

The world’s number one retailer of music is on the cusp of becoming the next MTV and the next Glastonbury, all rolled into one. Like, wow.

Don’t get stuck selling shovels

// June 24th, 2011 // 0 Comments // Hardware, Mobile, Products

There’s an old saying (who knows, it may even pre-date the internet) and it goes, ‘in a gold rush, it’s better to be selling shovels than trying to find gold’. Well, that only holds true if (a) you can control the market price of shovels; and (b) nobody knows where the gold is.

Once the gold deposits are mapped, or if cheaper shovel-makers start eating into your margins, you better pivot quick and become the best gold miner in the business, or the best refinery, or the best goldsmith in town. If the gold market changes from being about discovering gold to locking up, distributing and selling it, the act of shovelling becomes a much smaller slice of a much bigger pie, and your shareholders will punish you for not adapting to the changing market.

This story isn’t about gold mining, it’s not even about shovels. But as with most of my writing, I need analogies to set the scene. This post is actually about the smartphone market, and it’s partly a response to a post by Jojo over on 37Signals, where Jojo asserts that the new Nokia N9 handset may still be successful, even though the app offering for the N9 looks sparse. This post started out as a comment at the end of Jojo’s post, then got way too long for anybody to read at the end of many pages of other comments, so here it is in full.

Here’s the thing: the N9 will find customers and will be profitable, but will it be a big enough success to do what Nokia shareholders *really* want from the company? To take back #1 place? No. And the answer lies in the way Nokia just keeps selling shovels. Or, if you prefer, keeps making TV sets…

Oh dear me. Billions of dollars, thousands of well-paid employees, and this is what you see when you first go to Nokia.com?

The handset market is changing

Being a handset maker is becoming a smaller slice of a much bigger pie, in the same way that making TV sets is now a small slice of a pie mostly made up of content production, distribution/licensing, and advertising.

By sticking to handsets and partnering with Microsoft for mobile operating systems, what Nokia has done is to commit to making TV sets, handing the content production to Microsoft (the networks, remember, are already owned by carriers).

That would be fine, if making the hardware was still a premium margin business, or if the market for content was still unproven. But a seething mass of Asian manufacturers making Android handsets are cutting all the margin out of making smartphones, and the market for content is very much proven. VERY much proven.

For Apple, meanwhile, is the fastest-growing content production, distribution, licensing and sales business that the media industry has ever known.

Shareholders expect Nokia to make the same leap and the reason it’s taking a hammering is that it’s failing to do so. In fact, it’s been failing to do so for a very long time.

Build a better marketplace

Enough of TVs and shovels, they’ve served their purpose. Nokia can be a successful and profitable handset manufacturer, but it is now clear that it won’t be the biggest brand in the mobile space unless it has the biggest content marketplace. Mobile content is now largely about music, TV, movies and, more than anything, mobile apps. How’s Nokia doing?

Not good. Nokia’s first opportunity to build an app marketplace was actually with the N-Gage platform, which it launched in 2003. Apple didn’t launch the first iPhone until mid-way thru 2007. Here we are in 2011 and Nokia’s had several attempts at building a thriving content marketplace, yet has been overtaken by every other competitor of note, most especially by Apple.

Nobody likes inertia, especially a shareholder

Nokia’s had an eternity in ‘market time’ to see the change coming, from a hardware market to a content market. It’s even had the luxury of being first to market with a content store. Yet with each strategic decision it makes, and with each product releases, it just confirms that making hardware is written so deep into its corporate DNA that there’s no room in there to become anything else.

That’s OK, it doesn’t necessarily mean that Nokia’s doomed, it just means that the market will adjust its valuation of Nokia, and we see that happening right now, with shareholders pricing in the adjustment, realising that Nokia’s probably only ever going to do one thing well, and that’s make shovels.

The ‘rubber band’ and the future of music

// June 20th, 2011 // 0 Comments // Music

Been working on a new music startup recently, with a marketing colleague who stopped listening to popular music through most of the ’90s. Now his teenage kids are re-introducing him to the music industry of the present day and it’s been an interesting process of discovery for him.

For instance, he keeps referring to “bands” these days, like the smallest unit of commercial music is still two guitarists, a vocalist and a drummer.

That was certainly the case in the past, but like the internet atomised the album into 12 discreet musical products and a video, it’s also in the process of atomising the “band” into something looser, stretchier, more of a ‘rubber band’.

A rubber band’s configuration changes more frequently than in the ’80s and ’90s, with little or no media and fan panic. Each of the members of the rubber band is an independent artist to a greater or lesser extent, and each collaborates with others outside the rubber band from time to time. Each will increasingly have separate management, publishing deals and content contracts.

Taking a broader view, the rubber band is an interim step between the industrial music industry’s smallest denominator (band) and the independent artist, both in creative direction and legal entity.

The internet’s atomising effects won’t stop at breaking up the rubber band, it will move on to atomise the artist themselves, creating discreet commercial entities for each track, coffee table book, short film, app, game and item of tour merch. The eddies and surges of ecommerce will sometimes recombine these elements in traditional ways, and sometimes in surprising ways, but only because the internet has first split them apart.

The legal and business friction still holding the artist together as the smallest unit of artistic commerce will soon be gone. Not only will the art remain, it is in the process of becoming vastly richer, more collaborative and complex.

Bugherd adds 500Startups to investor roster

// June 10th, 2011 // 0 Comments // Funding, My work, software, Startup

I’ve been working with Melbourne web startup founders Alan Downie and Matt Milosavljevic of Bugherd since they were accepted into the Startmate startup incubator program, in which I’ve been an investor and mentor. Bugherd graduated from the mentoring program with flying colours, securing additional investment backing from Startmate, and other investors, including me.

Bugherd experienced a brief outage early Friday morning AEST which apparently was unrelated to the fact that they’d been mentioned in the morning’s US tech press including TechCrunch, GigaOm, VentureBeat, ReadWriteWeb and AllThingsD.

Some of the coverage on the investment announcement

It wasn’t news to me exactly, since there’s been talks with the 500Startups team since Alan and Matt pitched in the 500Startups Mountain View office with the Startmate crew back in April, but it was great to be able to talk about the deal finally, and especially gratifying to be mentioned alongside some other really promising startups.

Alan and Matt will be over in Mountain View in July and August, for demo days with the 500startups team and other meetings. But Bugherd’s not attending for the full incubator program because it’s further along in its journey towards hugeness.

500Startups’ decision to invest means they’re excited in the potential of the product and the company, particularly when it comes to delivering a service all early-stage web startups need: a great issue tracking tool. Interested enough that being on the other side of the Pacific isn’t too far away, even. Hope we can get Dave McClure and Christine Tsai out here soon to visit and meet some of the other great people in the startup community here.

I’ll keep track of any further coverage of the announcement at http://bit.ly/500startupsinvestsinbugherd

Try Bugherd now if you need the world’s simplest bug and issue tracker. I have it on good authority the free beta period is about to close, but beta users will get a big discount when pricing is announced in the near future.

Apple: awesome hardware but terrible at eCRM

// September 10th, 2010 // 0 Comments // Customer relationships, Music

I sell the odd bit of music on iTunes through my hobby record label Littoral Records and I’m frequently amazed at how poorly Apple manages its online relationships with music labels.

The team at iTunes Connect frequently send out emails announcing new features or changes, and the email includes not a single link that might give you one-click access to that feature, not one trackable URL that give the Connect team some idea of who’s responding to their email relationship management.

Wow.

An email update from iTunes Connect. And no link to click on.

Interviewed on E-Marketing Insights podcast

// August 2nd, 2010 // 0 Comments // As featured in..., Content, Industry, My work, platform, Social Media

This week I was interviewed by Owen of the E-Marketing Insights Podcast. Listen in for a little background history of Doing Words, as well as my perspective on what happened in the early days internet content publishing, how the Web 1.0 bubble grew and burst, why social media has changed the content publishing industry irrevocably, the continuing democratisation of content, and which brands I believe are best-equipped to succeed in future content markets.

Surgeon-General’s Warning: I hadn’t taken my brevity medication before the interview so you may find I rattle on for quite some time.

You know what’s great about this podcast episode? It’s only episode four of a brand-new podcast. It was recorded on a portable digital recorder, in my car, and the total post-production probably took Owen only an hour, from importing, editing and through to hosting on Soundcloud.

Despite the market-dominating power of iTunes and News Corporation and Facebook, more unique new content is being published every year by the people who would have been considered “the audience” twenty years ago.

Check out Owen’s E-Marketing Insights podcast, it’s early days yet but shows great promise, and that’s the best kind of content there is.

Some thoughts on product management

// July 18th, 2010 // 0 Comments // My work, Products

Just realised I never shared this presentation I gave at product management consultancy Brainmates. It was a while ago but many of the points I made are as valid (or invalid) now as they were then, including:

• Product management is mostly about translation
• Managing product development teams is easier if you can rephrase business requirements as interesting, challenging puzzles
• Good product managers are top-level guys, but with a detailed subfloor

Hmmm… some of that may make more sense if you view the presentation below. Let me know what you think…

Twitter and Facebook: millions of tiny broadcast audiences

// July 2nd, 2010 // 0 Comments // Marketing, Social Media

They’re showing how little they understand when they say they want to add a follow button to the order confirmation page in their shopping cart. Look, knock yourself out, it can’t hurt, but i would expect a 0.0001% clickthru rate on that. It’s not like many of us start following companies we buy from at most once a year, especially when it’s just a retailer of products made by other companies.

Offering useful advice, however, in a friendly, conversational tone — that might well get you some followers. Can you find a way to advise customers on using the product or service they’re considering buying? Can you offer advice on the decisions made before purchase or even on the industry as a whole?

Besides, in 12mths time average Australian Twitter users will probably have 500+ people they follow on average, so for brands, being followed by a customer won’t mean that customer’s seen your message. Lifestream marketing messages are ephemeral things. There’s no way for the marketer to determine an equivalent to impressions/month. It’s like radio or TV — broadcast. Without panel research or clickthru data to show it’s been acted on, we have no idea whether it’s been seen.

Think of Facebook, Twitter and anything that displays a stream of updates as a form of broadcast media, but an unusually fractured kind. On TV, every audience member’s viewing habits are different; on lifestream media, it’s not just their viewing habits but the programming that is different, according to the number and nature of things they follow.

People ask me how I keep up to date with all the tweets I get from the 1,000+ people and brands I follow. I tell them I don’t — but that’s not the point — by following 1,000+ people I ensure that there’s always something interesting to read whenever I have time for Twitter.

(This post was my first from an iPad. Another device further dividing attention into smaller chunks. I’ll tidy it up later, promise!)

Hard to design products for people who aren’t paying attention

// June 11th, 2010 // 0 Comments // Other news, Search

“I think most consumers use a search engine the same way they brush their teeth — with 90% of their attention on something else, with impatience, boredom and frustration with the whole category of search. They begin with unreasonable expectations about the quality of the result and with minimal patience for any request to contribute to the input.

As search product designers we find it very hard to really live inside that mindset since our work requires that we have 90% of our attention on the product we’re designing. It’s really a kind of method acting to get inside the head of a search user.”

That’s me, talking to Kat Mackintosh in a two-part interview on Nestoria’s company blog. Read on for more bold assertions about how personalisation, recommendation and geolocation might change the world. Again.

You’d like to sell digital content? First, print and sign these contracts

// June 10th, 2010 // 0 Comments // Music

You want to sell music, TV, movies or apps on iTunes Store? First you apply for an iTunes publisher account, and when you’re accepted, the manual labour begins. You might have thought you were entering a Brave New World of media as digital bits, but for now, it’s back to the Stone Age for you.

Apple asks you to print out and sign a 70 page contract, in duplicate, for each geographic market iTunes services (US/Canada/Mexico, Europe, Japan, Australia/NZ, then you have to FedEx that stack of paper to Apple in Cupertino, where they will manually review each signature page, countersign each contract, and FedEx back your copy. They then scan and store their copy in some vast archive.

Apple feels this stack of paperwork and penmanship is necessary before you enter into the business of selling digital content over their digital distribution network.

Sadly Apple has yet to adopt digital signature technology