What’s up?

December 8, 2009

What have I been doing for the last 8 months? Surely not writing this blog. :)

Well… I have been busy elsewhere.
For starters I’ve been raising two kids. Cleaning, feeding, not sleeping enough. You know the routine.

I have devoted a lot of my energy developing our custom publishing start-up, Maggie. These are tough times, but I have been lucky. I have been blessed with extremely talented and enthusiastic colleagues. I find myself smiling almost every day walking to the office.

Maggie is the perfect place for me to explore the possibilities of integrating social media, traditional media and marketing. I have given a lot of presentations on the subject. Some can be found on YouTube and Slideshare.

I have also been writing. My new book project is called Goodmachine. The idea behind the book is simple: Companies should not focus on making money. Companies that try to be as good as they can make the most money. But I will probably never finish the book. I find writing a book more rewarding than marketing it. Goodmachine blog (in finnish).

My latest passion is a non-profit start-up called Perunapuu (Potato tree in english). It’s a web service that helps people find better tasting and greener food and ingredients.

Currently we are trying to find funding for the project.
If we get it of the ground it will be Good.

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Now you can read Strategy of giving also in estonian!

Kinkimise Strateegia can be downloaded from Teguila Estonia’s site.

kinkimise_strateegia

What do people really want?

February 25, 2009

Strategy of Giving has focused on the mechanisms of giving.

But what should companies give?

Freewars

February 5, 2009

Many people have asked me this: “What happens if everything becomes free?”
The answer is simple.

freewars

And it is not just a gloomy prediction for some ill-managed businesses. For many business areas it is inevitable. If your product or service is web-based, on the long run your only possible strategy is freemium. And if you’re running on freemium, on the long run you will end up in Freewars.

One of the first business areas to enter Freewars is music business. Every new band has to give all their music away for free. Competition is so fierce, that no newcomer can charce for his work.

Characteristics of Freewar:

  1. You have to constantly develop new free features.
  2. You have to make previously chargeable features free.
  3. You have to give more and more control to your customers.
  4. You have to spend more time and money on marketing your free product.
  5. New competitors with more developed free features appear constantly.
  6. Making any revanue becomes impossible.

Free Spotify memberships

January 18, 2009

I wanted to write an article about a new music service called Spotify. They are giving away free memberships and I wanted to know a bit more about their philosophy. So I emailed them some questions. Instead of answering, they rewarded me with 100 free membership tokens. I think that answered all my questions.

So if you want a free Spotify membership, let me know.

UPDATE: No more invites left. Sorry.

UPDATE2: Ihan tosi. Loppu. Fini.

What people really want?

January 4, 2009

Why do products so often fail?

As Mike Elgan brilliantly explains in his article, people want to be in control.

Free + Premium = freemium

December 17, 2008

Guest entry by Peter Froberg:

View SlideShare presentation or Upload your own. (tags: model business)

The term freemium was coined to describe a business model where you give away a free service and sell premium products. A prime example of this is Skype. They give away a free Voip client and sell complimentary products such as Skype out.

Not Gillete
The strategy of giving refers to free in a broader sense than freemium.
Freemium is not when subsidise one product with another. Like cell phones companies, that gives you a phone for $ 1 and lets you pay for it through the subscription.
Neither is it about give someone a glimpse of you product, like giving a free sample at the super marked or giving away one chapter for free download.

Freemium is characterised by giving away a quality product that people can really use, in and of itself. Like the VoIP client from Skype.
This is a valuable program that has over 1 billion downloads. Most of the users only use the free program and that is OK, because there are so many of them.

The cost of digital production is falling exponentially towards zero, and the marginal cost for digitally produced products is very low. The cost for Skype to provide a user with free phone calls is very low. Because of this, the model can be very profitable even though only 7-8 % buy something.

Not only IT
Initially this business model has been mostly used within IT. Yet within the last couple of years it has spread into other industries. Such as music, publishing and consulting.

For more about the freemium business model, see the freemium blog.