BLOGS WILL CHANGE YOUR BUSINESS
BLOGS WILL CHANGE YOUR BUSINESS
2005-04-25 at 9:24:00 am #9093
Blogs Will Change Your Business
Look past the yakkers, hobbyists, and political
mobs. Your customers and rivals are figuring blogs out. Our advice: Catch
up…or catch you later
Monday 9:30 a.m. It’s time for a frank talk.
And no, it can’t wait. We know, we know: Most of you are sick to death of blogs.
Don’t even want to hear about these millions of online journals that link
together into a vast network. And yes, there’s plenty out there not to like.
Self-obsession, politics of hate, and the same hunger for fame that has people
lining up to trade punches on The Jerry Springer Show. Name just about
anything that’s sick in our society today, and it’s on parade in the blogs. On
lots of them, even the writing stinks.
Go ahead and bellyache about
blogs. But you cannot afford to close your eyes to them, because they’re simply
the most explosive outbreak in the information world since the Internet itself.
And they’re going to shake up just about every business — including yours. It
doesn’t matter whether you’re shipping paper clips, pork bellies, or videos of
Britney in a bikini, blogs are a phenomenon that you cannot ignore, postpone, or
delegate. Given the changes barreling down upon us, blogs are not a business
elective. They’re a prerequisite. (And yes, that goes for us,
There’s a little problem, though. Many of you don’t visit blogs —
or haven’t since blogs became a sensation in last year’s Presidential race.
According to a Pew Research Center Survey, only 27% of Internet users in America
now bother to read them. So we’re going to take you into the world of blogs by
delivering this story — call it Blogs 101 for businesses — in the style of a
blog. We’re even sprinkling it with links. These are underlined words that, when
clicked, carry readers of this story’s online version to another Web page. This
all may make for a strange experience, but it’s the closest we can come to
reaching out from the page, grabbing you by the collar, and shaking you into
First, a few numbers. There are some 9 million blogs out there,
with 40,000 new ones popping up each day. Some discuss poetry, others
constitutional law. And, yes, many are plain silly. “Mommy tells me it may rain
today. Oh Yucky Dee Doo,” reads one April Posting. Let’s assume that 99.9% are
equally off point. So what? That leaves some 40 new ones every day that could be
talking about your business, engaging your employees, or leaking those merger
discussions you thought were hush-hush.
Give the paranoids their due. The
overwhelming majority of the information the world spews out every day is
digital — photos from camera phones, PowerPoint presentations, government
filings, billions and billions of e-mails, even digital phone messages. With a
couple of clicks, every one of these items can be broadcast into the blogosphere
by anyone with an Internet hookup — or even a cell phone. If it’s scandalous, a
poisonous e-mail from a CEO, for example, or torture pictures from a prison
camp, others link to it in a flash. And here’s the killer: Blog posts linger on
the Web forever.
Yet not all the news is scary. Ideas circulate as fast
as scandal. Potential customers are out there, sniffing around for deals and
partners. While you may be putting it off, you can bet that your competitors are
exploring ways to harvest new ideas from blogs, sprinkle ads into them, and yes,
find out what you and other competitors are up to.
Tuesday 6:35 a.m. How big are blogs? Try
Johannes Gutenberg out for size. His printing press, unveiled in 1440, sparked a
publishing boom and an information revolution. Some say it led to the Protestant
Reformation and Western democracy. Along the way, societies established the
rights and rules of the game for the privileged few who could afford to buy
printing presses and grind forests into paper.
The printing press set the
model for mass media. A lucky handful owns the publishing machinery and controls
the information. Whether at newspapers or global manufacturing giants, they
decide what the masses will learn. This elite still holds sway at most
companies. You know them. They generally park in sheltered spaces, have longer
rides on elevators, and avoid the cafeteria. They keep the secrets safe and coif
the company’s message. Then they distribute it — usually on a need-to-know
basis — to customers, employees, investors, and the press.
world of mass media, and the blogs are turning it on its head. Set up a free
account at Blogger or other blog services, and you see right away that the cost
of publishing has fallen practically to zero. Any dolt with a working computer
and an Internet connection can become a blog publisher in the 10 minutes it
takes to sign up.
Sure, most blogs are painfully primitive. That’s not
the point. They represent power. Look at it this way: In the age of mass media,
publications like ours print the news. Sources try to get quoted, but the
decision is ours. Ditto with letters to the editor. Now instead of just speaking
through us, they can blog. And if they master the ins and outs of this new art
– like how to get other bloggers to link to them — they reach a huge
This is just the beginning. Many of the same folks who
developed blogs are busy adding features so that bloggers can start up music and
video channels and team up on editorial projects. The divide between the
publishers and the public is collapsing. This turns mass media upside down. It
creates media of the masses.
How does business change when everyone is a
potential publisher? A vast new stretch of the information world opens up. For
now, it’s a digital hinterland. The laws and norms covering fairness,
advertising, and libel? They don’t exist, not yet anyway. But one thing is
clear: Companies over the past few centuries have gotten used to shaping their
message. Now they’re losing control of it.
Want to get it back? You never
will, not entirely. But for a look at what you’re facing, come along for a tour
of the blogosphere.
Wednesday 7:38 a.m. Hmm. How to start this
post? Idle talk about the weather, or maybe that red wine with dinner last
night? No. Let’s dive right in: One misstep and the blog world can have its way
with you — even when the coolest, most tech-savvy companies are
Google is regarded as a secretive company. So in January, when
a young programmer named Mark Jen started blogging about his first days in the
Googleplex, folks in the ‘sphere instantly linked to him. Jen certainly wasn’t
dealing out inside dirt. But he griped that Google’s health plan was less
generous than his former employer’s — Microsoft — and he argued, indignantly,
that Google’s free food was an enticement for employees to work past
Two weeks later, Google fired Jen. And that’s when the
22-year-old became a big story. Google was blogbusted for overreacting and for
sending an all-too-clear warning to the dozens of bloggers still at the company.
A Google official says the company has lots of bloggers and just expects them to
use common sense. For example, if it’s something you wouldn’t e-mail to a long
list of strangers, don’t blog it.
Jen clearly flunked that test. “As the
media got hold of it, I was quickly educated,” he says. He says he should have
understood the company’s goals and concerns better and been more sensitive to
them. Still, his adventure turned him into an overnight celebrity. He was wooed
by recruiters at Amazon.com , Microsoft, and Yahoo! A month later, Jen landed a
job at Plaxo, an Internet contact-management company. A key part of his job,
says a company spokesperson, is to help coordinate Plaxo’s blogging efforts — a
pillar of Plaxo’s promotional strategy. So what got him fired turned out to be
his trump card. Plaxo, like many other companies, is now drawing up norms for
blogging behavior, so that employees know what’s in bounds, and what’s
2:22 p.m. It sounds like the joke answer on a multiple-choice
exam. Name a leading company in blog communications: General
That’s right. For a company that’s slipping in the auto biz, GM
is showing a surprisingly nimble touch with blogs. GM uses them on occasion to
steer past its own PR department and the mainstream press.
Vice-Chairman Bob Lutz launched his own FastLane Blog. Bloggers applauded, and
car buffs flooded Lutz with suggestions and complaints. Lutz posted lots of
barbs from outsiders and won points for balanced responses. Like his answer to
criticisms of new Pontiacs: “Did you take a look at seat tailoring? Carpet
fits?…hood gaps, hem flanges? We used to be bad at those, too.”
Lutz is only part of GM’s blog strategy. In April the company yanked $10 million
in advertising from the Los Angeles Times and demanded that the
Times make retractions. Journalists asked GM for specific complaints, and
the car company held off. It said it wanted to work quietly with the Times and
not battle it out in the press.
How to get the word out through a back
channel? GM directed journalists to a blog, AutomoBear.com, that detailed GM’s
beef. (It had to do with a comparison between two cars, which GM thought was
unfair.) Both GM and Miro Pacic, the blogger at AutomoBear, say that GM provided
Pacic with information but that no money passed hands.
Fair enough. But
even if GM doesn’t pay for positive coverage in blogs, just consider the
possibilities in this new footloose media world. There’s little to stop
companies from quietly buying bloggers’ support, or even starting unbranded
blogs of their own to promote their products — or to tar the competition. This
raises all kinds of questions about the ever-shrinking wall between advertising
and editorial. We’ll cover that later, when we get to the blogs’ impact on our
own business — the media.
Thursday 8:56 a.m. It’s the latest
wrinkle on Descartes. I blog therefore I… consult. An entire industry is
rising up to guide companies into this frightening new realm. And the
consultants establish their brands and reps with their blogs.
biggest is Steve Rubel. A year ago, the exec at the PR firm CooperKatz & Co.
started his blog, Micro Persuasion. He was already pushing such clients as
WeatherBug and the Association of National Advertisers into the blog world. Then
early one Sunday morning, as he recalls it, “my wife was sleeping, and I was
sitting in the living room, laptop on my lap, and thinking if I am talking to
clients and reading these blogs, I should jump in.” When launching his site, he
had the smarts to contact big shots such as Dan Gillmor, who was a leading
blogger and tech reporter with the San Jose Mercury News. Gillmor linked
to Rubel’s site, and his traffic took off. It was great for his brand, and it
also gave Rubel a blogger’s education. “I became a living guinea pig for what I
preach,” he says.
Now Rubel is positioned as an all-knowing Thumper in a
forest of clueless Bambis. The first job, he says, is to monitor the blogs to
see what people are saying about your company. (An entire industry is growing to
sell that service. Even IBM’s banging at the door. Next step: Damage-control
strategies. How to respond when blogs attack. He says companies have to learn to
track what blogs are talking about, pinpoint influential bloggers, and figure
out how to buttonhole them, privately and publicly.
He gives the example
of Netflix . When a fan blog called Hacking Netflix asked the company for info
and interviews last year, Netflix turned it down. How could they make time for
all the bloggers? Predictably, the blogger, Mike Kaltschnee, aired the exchange,
and Netflix faced a storm of public criticism. Now Netflix feeds info to
Kaltschnee, and he passes along what he’s hearing from the fans. Sounds like
he’s half journalist, half consultant — though he insists Netflix doesn’t pay
Friday 10:46 a.m. The question came up at a panel discussion
last week: Any chance that a blog bubble could pop? The answer is really easy:
At least not an investment bubble. Venture firms financed only $60
million in blog startups last year, according to industry tracker VentureOne.
Chump change compared to the $19.9 billion that poured into dot-coms in 1999.
The difference is that while dot-coms promised to make loads of money, blogs
flex their power mostly by disrupting the status quo.
The bigger point,
which is blindingly obvious when you think about it, is that the dot-com era was
powered by companies — complete with programmers, marketing budgets, Aeron
chairs, and burn rates. The masses of bloggers, by contrast, are normal folks
with computers: no budget, no business plan, no burn rate, and — that’s right
– no bubble.
The role of the blog startups is to build tools for this
grassroots uprising. Six Apart, a four-year-old San Francisco company, leads in
blog software. Technorati and PubSub Concepts are battling it out in blog
search. The founders all insist that they plan to remain independent. But if
recent history is any guide, most of them will wind up in the bellies of the
blog-minded Internet giants — led by Google, Yahoo, and Microsoft. The latest
to disappear was Flickr. A photo-sharing service that spread madly across the
blog world, 13-month-old Flickr was still running its software in its beta, or
testing, phase when it was acquired by Yahoo in March for an undisclosed sum.
Caterina Fake, Flickr’s co-founder, wrote about the deal in her blog the day it
happened: “Don’t forget to breathe. It’s not the end, it’s the
Monday 10:23 a.m. If this were a true blog, that last
post would have generated a mountain of comments over the weekend, most of them
with the same question: If there’s no clear business model, why are the Internet
giants so bent on getting a foothold in blogs? Look at it from their point of
view. A vibrant community that has doubled in size in the past eight months is
teeming with potential customers and has a mother lode of data to mine. “Blogs
are what’s causing the Web to grow,” says Jason Goldman. He’s project manager at
Google’s Blogger, the world’s biggest service to set people up as
David Sifry looks at it a bit differently. He’s a serial
entrepreneur and founder of Technorati , the blog search engine.
Sifry, it’s not the growth of the same Web, but an entirely new one. It’s
wrapped up far more in people’s day-to-day lives. It’s connected to time. The
way he describes it, the Web we’ve come to know is mostly a collection of
documents. A library. These documents don’t change much. Try Googling Donald
Trump, and you’re more likely to find his Web page than a discussion of his
appearance last night on The Apprentice.
Blogs are different. They
evolve with every posting, each one tied to a moment. So if a company can track
millions of blogs simultaneously, it gets a heat map of what a growing part of
the world is thinking about, minute by minute. E-mail has carried on billions of
conversations over the past decade. But those exchanges were private. Most blogs
are open to the world. As the bloggers read each other, comment, and link from
one page to the next, they create a global conversation.
Picture the blog
world as the biggest coffeehouse on Earth. Hunched over their laptops at one
table sit six or seven experts in nanotechnology. Right across from them are
teenage goths dressed in black and thoroughly pierced. Not too many links
between those two tables. But the café goes on and on. Saudi women here,
Labradoodle lovers there, a huge table of people fooling around with cell
phones. Those are the mobile-photo crowd, busily sending camera-phone pictures
up to their blogs.
The racket is deafening. But there’s loads of valuable
information floating around this cafe. Technorati, PubSub, and others provide
the tools to listen. While the traditional Web catalogs what we have learned,
the blogs track what’s on our minds.
Why does this matter? Think of the
implications for businesses of getting an up-to-the-minute read on what the
world is thinking. Already, studios are using blogs to see which movies are
generating buzz. Advertisers are tracking responses to their campaigns. “I’m
amazed people don’t get it yet,” says Jeff Weiner, Yahoo’s senior vice-president
who heads up search. “Never in the history of market research has there been a
tool like this.”
Tuesday 9:12 p.m. Back to that coffeehouse.
Sitting at one large table is a collection of some of the most gifted geeks you
can imagine. These folks built the blogosphere. And they’re using it to link
with each other. They share ideas, test them, and get them up and running in a
hurry. Many of them transform the network itself, making it more muscular — and
The innovation that sends blogs zinging into the mainstream
is RSS, or Really Simple Syndication. Five years ago, a blogger named Dave
Winer, working with software originally developed by Netscape, created an
easy-to-use system to turn blogs, or even specific postings, into Web feeds.
With this system, a user could subscribe to certain blogs, or to key words, and
then have all the relevant items land at a single destination. These
personalized Web pages bring together the music and video the user signs up for,
in addition to news. They’re called “aggregators.” For now, only about 5% of
Internet users have set them up. But that number’s sure to rise as Yahoo and
Microsoft plug them.
In time, aggregators could turn the Web on its head.
Why? They discourage surfing as users increasingly just wait for interesting
items to drop onto their page or e-mailbox. Internet advertising, which
traditionally counts on page views and clicks, could be thrown for a loop.
Already Yahoo is packaging ads on the feeds. Google is testing the
But here’s the really insidious part. If you set up your own
aggregator page, such as my.yahoo.com, and subscribe to feeds, you soon discover
that blog and mainstream postings mingle side by side. Feeds zip through the
walls between blogs and the rest of the information world. Blog posts are
becoming just part of the mix, swimming on the same page with the Associated
Press, and yes, BusinessWeek.
Winer also ushered in a second tech
breakthrough, podcasting. A back-and-forth between Winer and Adam Curry, a
blogger and former MTV host, led last year to a system that easily distributes
audio files. Looking for National Public Radio’s On the Media or the latest ska
compilations from a disk jockey in Trinidad? Sign up on a Web page, and the
program gets automatically delivered to you — as an audio feed. Last summer,
Curry created software called iPodder so these MP3s could hitch a ride on an
iPod . That was the birth of podcasting: radio programming whenever and wherever
you want it. Since then, some 5,000 podcasting shows have sprouted up. They
cover everything from yoga to the blues.
It’s an overnight sensation.
Before podcasting, only about 150 people a month bothered to download the audio
files of Morning Stories, a show on Boston’s public station WGBH. After the
station switched to podcasting in October? Eighty thousand. Chalk it up to the
bloggers. They pushed podcasting to their own circles, and it grew from
11:48 p.m. One more idea. Think of TiVo, think of the
iPod. When you’re using one of them, do you consider the company that provides
the programming? CBS, for example? Not much. You’re putting together your own
package. The pieces come from lots of companies and artists. Often you don’t
even know where.
Aggregators do the same job for the Net. So, just like
the record companies, which have figured out how to market bits and pieces of
their albums as standalone songs and ringtones, the rest of the media and
entertainment world is going to have to think small. Content, whether it’s news
or a Hollywood movie, is going to travel in bite-size nuggets. The challenge,
for bloggers and giants alike, is to brand those nuggets and devise ways to sell
them or wrap them in advertising.
Wednesday 6:31 a.m. A
prediction: Mainstream media companies will master blogs as an advertising tool
and take over vast commercial stretches of the blogosphere. Over the next five
years, this could well divide winners and losers in media. And in the process,
mainstream media will start to look more and more like — you guessed it —
blogs. Clay Shirky, a Web expert at New York University, calls it “an absorption
process where the thing doing the absorbing changes.”
Take a look at blog
advertising today, and it’s hard to see a glittering future. Sure, enterprising
bloggers make room on their pages for Google-generated ads, known as AdSense,
and earn some pocket change. Some blog entrepreneurs, such as Nick Denton,
publisher of New York’s Gawker Media, sell ads for everything from Nike to
Absolut Vodka. Popular blogs can land sponsorship deals for as much as $25,000
per month, say consultants. O.K. money for an entrepreneur, but a rounding error
in the ad industry.
Blog power simply doesn’t translate yet into big
bucks. For now, it’s running mostly on people’s passion to communicate —
especially in developing markets. Consider Hossein Derakhshan. He’s a
28-year-old Iranian blogger based in Toronto. He has thousands of readers, and
politicians respond to his postings — even as the Iranian government
frantically tries to shut down the servers hosting his blog. Yet Derakhshan
can’t yet cash on his fame. “Google doesn’t have AdSense service in Persian
yet,” he says.
Still, blogs could end up providing the perfect response
to mass media’s core concern: the splintering of its audience. Advertisers
desperate to reach us need to tap niches (because we get together only once a
year to watch the Super Bowl). By piggybacking on blogs, they can start working
that vast blogocafé, table by table. Smart ones will get feedback, links to
individuals — and their friends. That’s every marketer’s dream.
companies have what the bloggers lack. Scale, relations with advertisers, and
large sales forces. They can use these forces to sell across all media, from
general audience to bloggy niches. Already, Yahoo and Microsoft have been
investing heavily to position themselves for niche advertising. And in February,
the New York Times laid down $410 million for About Inc., a collection of 500
specialized Web sites that smell strongly of blogs. “What’s to stop them from
turning those 500 sites into 5,000?” says Dave Morgan, founder of TACODA
Systems, an Internet advertising company.
Thursday 9 a.m. Hate to
get wiggy here. But if the blogs eventually swallow up ad revenue, what’s going
to happen to us?
Yes, we, too, are under the gun. MSM, the bloggers call
us. Mainstream media. And many of them delight in uncovering our errors,
knocking us off that big pedestal we’ve occupied since the the first broadsheets
We have to master the world of blogs, too. This
isn’t because they’re taking away ad revenue, at least not yet, but because they
represent millions of eyewitnesses armed with computers spread around the world.
They are potential competitors — or editorial resources.
showed their value following the Asian tsunami in December. Thousands of them
posted pictures, video footage, and articles about the disaster long before the
first accredited journalists showed up. MSNBC, which ran hours of tsunami
footage on its Web site, has since opened an entire page devoted to citizens’
Dan Gillmor, who quit his San Jose newspaper job, is lining
up investors for a new type of media company, Grassroots Media. He’s interested
in elements of an online journalism business in Korea, called OhmyNews. It
mingles articles from 50 staff journalists with reports e-mailed and
text-messaged in from thousands of citizen reporters. OhmyNews says it has been
profitable for a year and a half and expects revenue this year of $10 million.
“I keep hoping that all of the new conversational forms will augment the
existing one,” Gillmor says.
11:57 p.m. Thinking out of the box
here for a minute. What would this article look like if it were a real blog, and
not just this glossy simulacrum?
Think of the way we produce stories
here. It’s a closed process. We come up with an idea. We read, we discuss
in-house, and then we interview all sorts of experts and take their pictures. We
urge them not to spill the beans about what we’re working on. It’s a secret.
Finally, we write. Then the story goes through lots and lots of editing. And
when the proofreaders have had their last look, someone presses the button and
we launch a finished product on the world.
If this were a real blog, we
probably would have posted our story pitch on Day One, before we did any
reporting. In the blog world, a host of experts (including many of the same ones
we called for this story) would weigh in, telling us what’s wrong, what we’re
overlooking. In many ways, it’s a similar editorial process. But it takes place
in the open. It’s a discussion.
Why draw this comparison? In a world
chock-full of citizen publishers, we mainstream types control an ever-smaller
chunk of human knowledge. Some of us will work to draw in more of what the
bloggers know, vetting it, editing it, and packaging it into our closed
productions. But here’s betting that we also forge ahead in the open world. The
measure of success in that world is not a finished product. The winners will be
those who host the very best conversations.
Friday 11 a.m. So why
not start here? We’ve done our research on blogs, made our dire pronouncements.
Pretty soon, someone in production will press the button. But this story should
go on, as a conversation. And it will, starting on Apr. 22. We’re launching our
own blog to cover the business drama ahead, as blogging spreads into companies
and redefines media. The blog’s name? Blogspotting.net. See you there.