Does the Internet level the playing field?
#1
Posted 10 January 2006 - 08:28 AM
I remember from my rugby playing days that, however level the playing field, if the other team were titans, then you had quite a battle on your hands. Before the Internet, certainly the 'air-waves' could be dominated by the big advertisers. If you didn't have money you could walk along the pavement (sidewalk to my North American friends) with a sandwich board promoting your small business, but it was very tough sledding.
Now if you can get some buzz going in the blogosphere it's very much easier to get the world's attention. It doesn't take much cash. Just use your brains. I was hoping the new analogy might be those small hairy creatures who were wandering around among the dinosaurs. Who will survive in the long run?
Mike Grehan seems to bring us back to earth. Money is still power. We don't have a level playing field. Perhaps my question must be revised. So what do you think? Has the Internet made the competitive playing field more level than it used to be?
#2
Posted 10 January 2006 - 10:30 AM
There's always been the threat that, in the future, some companies (such as search engines) could turn the Web into just a few major portals blasting ads at all visitors and charging exhorbitant rates to advertisers ... a kind of Web version of network television. (Aside: remember Disney buying then-major search engine Infoseek, rebranding it as "Go" and turning it into a piece of dust, while leaving the GoGuides -- volunteers who had been building the Go directory -- stranded?)
Now we're watching the major players conglomerate like mad; like music before it, television and film are coming to the Web big time. One could worry about the same thing here -- that only the "megabucks" companies will be able to compete in search engines and other Web advertising.
There's one thing that heartens me, though, and it's this: unlike television or most radio, the Web is not a one-way flow. Audiences do not sit passively, eating up whatever's fed to them because there's nothing else to do. Nope; in many ways, the Web is a participatory medium -- and I'm not sure that "audiences" will be ready to give that up.
(Aside: witness the phenomenal success of myspace.com. I recently read an interview with one of the founders; they put together something that their competitors weren't doing and allowed things their competitors weren't allowing, the community flowed in and, in his words [paraphrased, but the sense is the same]: the advertiser money came flying back at them.)
So, I'm not so worried now. I assume that the major portals would *like* the "network TV" captive audience kind of scenario, but I'm almost ready to guess that they're just going where the audience is going and providing what the audience might want ... which likely will *never* be a sedentary, docile one-way flow.
Why do I think that? Because that option has been open to that audience all along. And they're coming here in droves. Ya know?
What about us? None of us were born geeks, or whatever it is we are now. No, but we hung around long enough to acquire enough knowledge to effect that odd transformation. <grin> Because we liked it.
Now, as to the "big players take all" scenario. First, I don't know Mike, and I don't know upon what he based his statements; however, they've just changed the company name (after various rumors flying around) and it reads, really, like a marketing/public relations piece to me.
Sure, it has some truth in it, but I've got to assume that the big players have always had the money to advertise well and to do whatever else they need to do; why should this be different? Does that mean they'll beat everyone else out at every possible turn? That we won't be able to see anything but Big Boys on our screens every time we go to the Web?
It's not for me. And I have to assume that not all audiences will want or actively seek to wall themselves into a garden of big-boy advertising. The fact that they haven't being doing so speaks volumes.
Edited by DianeV, 10 January 2006 - 10:34 AM.
#3
Posted 10 January 2006 - 03:38 PM
The big boys with money have a few advantages over the little guy.
They can advertise more
They can devote more resources to a problem
They can devote resources to support
They can (and this is a biggy) just purchase a little guys hard work outright.
They have more money for better hardware.
The little guys have a couple of advantages.
They are more flexible.
They are usually more inventive and produce better quality work/ideas.
The little guy can make it big, but usually they sell out, or get pressured out by the big guns. Its hard to compete, unless you are lucky, or very talented, or rich. But it can be done, sometimes.
#5
Posted 10 January 2006 - 04:13 PM
The result was the first web bubble.
People who didn't take any time to understand what they were buying into created unrealistic prices for things that they simply couldn't make back in a short-term. At which they panicked and made a total mess.
Their mistake was to stand around scratching their head saying: "I don't understand, the Internet was like printing money! See that geek over there? Well he made 50,000 times his investment back in just one year!"
To which one could attempt to explain it with "Yes, but not because he built something worth that. He made 50,000 times his investment because some idiots offered him 100 times more than his company could possibly be worth."
They say "But I bought that company"
And I reply: "Did I say I didn't know which idiots?"
Years pass and they have eventually got a little smarter. Oh, not about the web itself. Just smart enough to hire someone who does know about the web to advise them. Smart enough to not just throw money at the first thing they see, but to seek to pay as little as they can, and examine the parts they do understand - the balance sheets.
If anything, most are still over-cautious. Some great ideas find it very hard to find venture capital. But the result is that the big boys now own substantial properties, and are now involved enough to have understood the internet far better. In many cases, they now understand it better than the little guys do. That's because the 'little guys' of just a few years back that had any smarts, are not still little guys.
Some of the big guys bought the little guys, and some of the little guys grew into big guys. The little guys of today generally fall into one of two broad groups - they were either slower to adapt and adopt than even the big guys, so are new, or they had a free run at the market and failed to realise that opportunity.
Once the whole internet was a niche. Now it isn't. Once the big guys failed to pay it much notice. Now they do.
There's nothing in that that wasn't both predicted and shouted back in the Nineties. We all knew back then that the internet was an opportunity you needed to get into fast - before the big guns took notice.
Yes, money speaks, and big money hollers. We always knew it would.
There are still niches that either are not profitable enough for the big companies to develop, or that the big companies haven't seen yet. That too will always be true. That is where the little guys of today can become the big guys of tomorrow.
Welcome to the basics of marketing.
#6
Posted 10 January 2006 - 05:56 PM
The WWW is a mass medium with more or less global reach. Yet a domain name for IBM, Microsoft, and the butcher on the corner all come at the same price. Unlike with television, radio, satellite, everyone can get in. You don't need your own domain name, hosting account, heck, you don't even need your own Internet connection. As long as you have a bit of time somewhere at a connected computer you can publish until you see blue in the face.
WWW is the first mass medium not only open to be consumed by the masses but to be used by the masses.
There are no limits to the WWW. Unlike is the case with the airwaves, there is enough WWW to go around for everyone and then some. Unlike is the case with trees, there is enough virtual space to go around to publish billions upon billions of pages. The very scarcity in channels, trees, or even ad space, which has driven up the price of the use of other mass media, is totally absent on the WWW.
So yes, the field is definitely more level because this time around we all get to be on the field.
Now Mike's piece makes you wonder if that means anything at all given the huge war chest the big guns bring to the table.
Well, sorry, but Mike isn't talking about money: he's talking about marketing.
Marketing equals buzz, which equals awareness, which leads to consumer demand.
This holds true for all - not only for marketing with a lot of money behind it. Money can make marketing easier but money doesn't equal marketing.
You could produce absolutely nothing but buzz based on a product that doesn't even exist and still spend no money at all. Face recgonition photo site Riya has been doing nothing followed by being in alpha development for "ages" yet we talk about it. How about Flock? We talk about it. Or 37signals which not only put itself but a programming language on the map? How about putting out a "it's just better" service on a shoestring budget and seeing it blossom into a multi-billion dollar company simply because everyone tells everyone else how great it is?
Or how about creating awareness of a name change by writing an article everyone links to and talks about?
Nah, in a time where Wal-mart gets nervous because of the online buzz, so much so that finally they take their automated movie suggestions offline, you can bet things have changed; for the little guys and for the big guys.
#7
Posted 11 January 2006 - 02:04 AM
They can buy more links, they can pay to have better content created, and they can also hire more smarts.
As the little guy you have two potential advantages.....
1) Being the first mover in your field and getting the jump on them. In a showdown the fastest draw wins if you can hit your challenger.
2) A person working on a "passion" will generally defeat someone working on a "profit".
But with both 1 and 2, money is still the ultimate gun and they can blow you out of the water if they are willing to spend enough to get you - plus know what they need to do.
In my area, I came from behind and kicked their asses via smarts and passion... now they are madder than hell but have not yet figured out what to do about me. So I am trying to get as much distance on them as is possible so that it will be very expensive for them to catch up.
Edited by EGOL, 11 January 2006 - 02:08 AM.
#8
Posted 11 January 2006 - 02:45 AM
It takes more to start a mega"Mart" than to start a produce stand.
Bad decisions by small businesses dig smaller holes to get out of and hack off fewer consumers.
Consumer relations in a small shop are simpler, more direct.
We've all had the experience of making three or four phone calls to a mega business before getting through to the right department on a phone tree.
Small companies are more nimble.
Big companies need more time to move.
Big companies can create a need.
Small companies tend to spring from meeting an existing need in a creative way.
It's all in where you stand and what you want to do with it.
Elizabeth
#9
Posted 11 January 2006 - 06:22 AM
Smaller companies have a natural advantage in the speed of decision making.
The previous company I worked for with 6,500 employees took 6 months to make a decision. They were not a bad company, but they had lost the zing that made them the big company in the first place.
The numbers on internet marketing for small to medium businesses really stack up, because with limited marketing funds, they need something with good feedback and analysis to focus the dollars in the right area.
#10
Posted 11 January 2006 - 03:34 PM
The Internet is a battle of links and content quality and SEGO smarts.
They can buy more links, they can pay to have better content created, and they can also hire more smarts.
As the little guy you have two potential advantages.....
1) Being the first mover in your field and getting the jump on them. In a showdown the fastest draw wins if you can hit your challenger.
2) A person working on a "passion" will generally defeat someone working on a "profit".
But with both 1 and 2, money is still the ultimate gun and they can blow you out of the water if they are willing to spend enough to get you - plus know what they need to do.
In my area, I came from behind and kicked their asses via smarts and passion... now they are madder than hell but have not yet figured out what to do about me. So I am trying to get as much distance on them as is possible so that it will be very expensive for them to catch up.
I agree with your general concept, and would like to add that the little guy has faster response time can react much quicker then bigger companies where either the right hand doesn't know what the left hand is doing, or where you need management review and approval before any changes are made.
I am pretty much a little in the big show of life, however I have been hired by larger companies and I know first hand that at least some of them fear the little guys. Not only are there more little guys then big companies (more competition), but they do not really know how to compete with them. Often I'd hear, "we have more to loose then they do".
Also noteworthy, if you been online since the 90's you know that back in the 90's there were a lot more little guys then big guys! Many of those little Ma & Pa companies from the 90's are gone now. Either they went out of business or they became bigger companies. The fatality rate continues to increase each year for start up businesses on the Internet, even for larger companies!
Here is where I stick my neck out. Any business big or small that relies entirely on the top 3 search engines to survive is already doomed! If that is the road you take, you will find it will get even harder!
I see the trend moving away from conventional seo/sem, and moving more towards marketing. I also see many new avenues appearing for webmasters to take advantage of. Blogging, niche search engines, aggregators, rss syndication to name just a few.
Those who have some marketing talents/skills will do just fine, and even better then before! Those who cling to the old school of seo will be in for a very rough ride! I've been online since 1994, I credit my long survival to my ability to adapt to changes, nothing ever stays the same on the Internet.
Regards!
#11
Posted 16 January 2006 - 11:31 PM
For me, one of the most interesting dynamics is when a big guy does something that will help the little guys. Google's recent release of Google Analytics is a good example.
I do web analytics for small-mid sized companies, and the costs in getting a good web analytics tool in place was prohibitive for a lot of them (not to mention the challenge of trying to make the case that the long term ROI would pay for the investment). The tool vendors were largely aiming at the big companies, and those big companies were reaping large gains from using web analytics.
Then Google comes along, provides a pretty darn good tool for free. Their pipeline problems aside (for those who don't know, Google shut down the pipeline for new registrations less than a week after launch, due to overwhelming demand), web analytics just got accessible for every company of any size.
I'm not Google's biggest fan, but in this case, I think they did a lot to level the playing field, especially for e-commerce sites, but others as well.
Debora
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