MappingTheWeb //

You gotta be kidding me. It used to be a joke, and now it’s just plain ridiculous. Obviously, I’m referring to the new Technorati site re-launch. Techcrunch seems to like the new offering. Don’t ask me why. I’m completely baffled by the new direction of the company.

To me (and many others), search is CORE to Technorati. It is their primary offering. But it seems that the focus is shifting. The new site looks more like a news portal than a search engine. Features such as the “percolator” and tag cloud are being emphasized. I believe these to be secondary/supporting features. In other words, they shouldn’t be showcased. As search is the core offering, SEARCH should be emphasized. And for some insane reason that’s beyond me, they’ve shrunk the search box - it’s tiny. I implore everyone to visit the Technorati home page and take a look at the size of this box. It’s comparable to a regular (small) search box on any given website. This is ridiculous for a so-called “blog search engine”. It’s unacceptable.

I wish I could talk to the new CEO and say, “What the heck are you doing?” The guy is off to a bad start already. I’m genuinely upset about this new company shift. It’s illogical and irresponsible. If less concentration is going to be placed on search and more on content and discovery, then rebrand the company. Otherwise, focus on your core competency and let the rest take care of itself. Like I say, any new visitor to Technorati would assume that the site is more focused on current blog content rather than search.

Let me go on to criticize the home page a bit more…

First of all, way too much space has been allocated for advertising. I can spot one leaderboard, one giant square, and three text ads above the fold. Personally, I think they diminish the overall experience. I understand that they are part of the revenue model, but I still think they can be integrated in a more appropriate manner. Currently, they are completely ruining the experience.

I’ve criticized the company in the past, but this is a whole new ball game. Here is my advice for the company (free of charge): throw out the new stories, tags, some of the ads, and just gimme a big friggin search box. There… I saved the company thousands in consulting fees. Thank me later.

Once again, I encourage everyone to hit the Technorati home page and try to spot the search box. It’s like “Where’s Waldo 2.0?”… I’m sure you’ll be unpleasantly surprised.

Good question. Apart from MyBlogLog users, I have no idea who reads my blog. Having said that, I am very keen on getting to know my readers. I truly appreciate all the comments, trackbacks, links, and e-mails. Nevertheless, there are still those who like to hang around the periphery and watch from a distance. I have no problem with that, but for this one post…

I would like all regular readers, as well as new visitors, to introduce themselves with a simple comment below. Just mention your name, how long you’ve been reading the blog, and what you do for a living. Heck, you can even mention your company or your pet’s name.

This is simple experiment to help us all get to know one another. It may also provide some added exposure for yourself or your company. So please be sure to drop a comment - even if it is very short. Thanks guys.

I’ve written several articles about the problems that web 2.0 is facing if it is looking to break into the mainstream. A small number of companies, most notably Facebook, are doing a good job of ushering in these technologies without scaring regular folk with complicated terminology.

So what’s the next step?

Let’s talk benefits, not technologies. Once the benefits are apparent, the ‘intimidation factor’ of web 2.0 terms will be eliminated. Subsequently, non-savvy users will be more likely to adopt the technologies and take advantage of their potential.

In other words, tell me how I can:

• Make cheaper phone calls. Don’t tell me about VOIP.
• Create my own personalized channel of content. Don’t tell me about RSS.
• Collaborate on projects or documents with colleagues. Don’t tell me about wikis.
• Add functionality to my blog or website without any technical knowledge. Don’t tell me about widgets.

Like I say, people will eventually acknowledge the terms, but for now, the benefits are what need to come to the forefront. Once this can be accomplished, useful web 2.0 sites can climb into the spotlight and showcase their value.

An interesting point to note is that a large number of Internet users are already taking advantages of these web 2.0 technologies and they don’t even know it.

I know it’s a bold statement that isn’t entirely true, but let me explain. Obviously, a large number of successful companies can call advertising their revenue model, but this is only after siginificant traffic growth. The number of new start-ups that launch with an advertising model in mind, compared with the number that can actually sustain such a model is minimal. I would consider it a generous estimate to say 1% or so can do it.

Let’s do a little math experiment (using some basic assumptions)…

Company XYZ has 3 full-time employees. Let’s also say that they have no other expenses as they run out of a makeshift basement office. Assuming an extremely modest salary of $50,000 a year each, the company needs to generate revenues of $150,000 a year just to break even. Keep in mind that we are assuming no other expenses exist, even though hosting, bandwidth, and other factors should (in theory) play into the equation.

So, in order to break even, the company needs to generate $150,000, or $12,500 a month, or $417 a day. That doesn’t seem too unrealistic. Now, let’s assume that the website can achieve a $5 CPM, which is relatively good for a small company. The company would need to generate 83,000 page views per day just to break even. This is where many begin to realize that monetizing via advertising is much harder than it seems. From a monthly perspective, that’s 2.5 million page views per month. That’s a significant number. Once again, keep in mind that this is assuming no other expenses and doesn’t include a lifestyle of luxury.

[Please feel free to rip apart my math, point out any inaccuracies, or add any relevant commentary.]

On the whole, what I’m trying to say is that an advertising model is possible to sustain, but it’s rare. Other forms of monetization are much more effective and attainable. With such high levels of competition in every area of the Internet, your ability to capitalize on ads has been greatly diminished. 

As we all know though, many of these companies never intended on monetizing via advertising like they say. Their sole intention was to build traffic and sell off to a major player (Google, Yahoo, Microsoft). This is the typical web 2.0 revenue model. This “hope for the best” strategy is risky, but has paid dividends for a small minority. I wouldn’t recommend it though.

Historically, if you’re looking for a mortgage, you head to your local bank to get the best available rate. Next you may visit several other competitor banks to find out their rates. Some people even make use of a mortgage broker. In any case, the purchase of a home is usually the single biggest purchase in a given individual’s life. For that very reason, the research and due diligence leading up to the decision cannot be taken mildly. In many cases, people don’t put enough time and effort toward the cause and end up with an inflated rate that puts a severe damper on their finances for years to come.

SmartHippo wants to change the way we think about and deal with mortgages. The goal of the company is to bring transparency to the financial services industry by providing an unbiased look at mortgage rates. How so? Essentially, the site is powered by users. These individuals post rates depending on their profile and geographic location. Banks and mortgage companies can also post rates (SmartHippo becomes a marketing outlet for them). When a user wants to ‘compare rates’, a snapshot of current conditions is generated based on the user’s geography, credit score, equity, etc…

So how does one know if a rate is accurate? Rates receive votes and comments by the community, akin to Digg submissions. Assuming a community-controlled system works, the bad rates will be weeded out and the good rates will rise to the top.

Users can also ‘get a quote’. This is different from comparing rates. In this case, a user enters their criteria and contact information, and instantly gets matched with up to four lenders who will contact them with a personalized offer. Strict security and privacy policies are present site-wide. This allows users to remain anonymous at all times if preferred.

Because the site is geographically-sensitive, users can discuss their experiences with other local mortgage hunters. A forum provides a great place for vent or recommend a given financial service company.

I had the pleasure of chatting briefly with the CEO, upon which I had one issue in particular. It went something along the lines of this: for the most part, people only buy one house during their lifetime. Assuming they use SmartHippo to capitalize on rates and the purchase has been completed, why would they want to come back to the site? In other words, SmartHippo no longer serves a purpose to that individual. “Not so fast…”, he tells me. The company is planning to diversify in other financial services areas, including insurance, stocks, mutual funds, etc… This helped answer my question concerning repeat visitors and site “stickiness”.

Interestingly, the service is free to use. If I’m not mistaken, revenues will be generated via targeted advertising. In addition, SmartHippo is only available to US consumers at this point in time. Ironically, the company is based out of Montreal. Plans have been made to enter the Canadian market in the near future, although the US provides a much larger base at the present time.

I think SmartHippo is a great idea that merits further scrutiny. I look forward to a time when it available in the Canadian market and I can make use of the service. The concept and basis are very new and fresh. It will be interesting to follow adoption and acceptance of the service as the industry progresses from a traditional model to a more current, innovative one.