Advertising and Communities

A lot of the successful businesses have learned how to use two very important tools: the advertising industry, and the power of communities.

These both become more and more important and more and more powerful. Google for example became one of the mostly known companies in the world by making money from advertising. On the other hand, communities become more and more important, even to the point to decide the industry evolution or to help a company grow and evolve.

The purpose of the advertising industry is simple: taking the message to as many people as possible. It can use many types of media: television, radio, printed papers, internet. No matter how it propagates, the final goal is always the same: taking the message to more and more people.
The purpose of communities is always to grow by attracting more users. As they grow, communities gain visibility, they gain power, they draw attention and start to be heard and listened to.

When someone finds out how to join the advertising industry and the communities successfully, they have a good chance to develop a great business. Let’s take (again) Google as an example. They focused on the community first, they had millions of users long before they started thinking how to make money. When they found the solution with using advertising, their users community was growing so fast that it was pretty easy to predict where they were heading.

Nowadays, a lot of people look for successful solutions from combining advertising and communities. Though each of these two has at least one fault which have to be overcome in order to create a successful business.

The problem in the advertising industry is that people pay less and less attention to the ads. No matter what the ads are (video, audio, printed, text), people are getting better at ignoring them. One reason might be that the ad campaigns become more and more aggressive, so we have to protect from them somehow. On TV, when a show is stopped for ads, people start changing the channels. They avoid (consciously or not) being fed with more and more ads, so they start changing channels. The percentage of people who really watch the ads is smaller than the people watching tv. On the web, almost every page displays ads because it’s a good and easy way to make money. But the readers develop like a 6th sense and get better and better at reading the articles between the ads, without even noticing the ads.

In order to overcome this problem, the ads campaigns have get smarter and more interesting, in order to be noticed by people. The video ads have to present a story which sticks into our minds, the printed ads have to have more color and some layout that draws attention. The text ads have less possibilities to draw attention, and probably will be replaced by video ads. Though these are not real solutions, because as they become better, we become better at ignoring them.

In communities, drawing more users is pretty easy. Most communities attract users by focusing on general topics like cars, music, movies, blogging, sports, sex, money, or more specific topics like: bmw, porche, gm, ford (cars), football, basket-ball, baseball (sports), and so on. The more general the addressed topic, the more users will want to join that community. Probably the best topics for growing communities would be the ones addressing our needs: money and sex. With money we can eat what we want, we can drink what we want, we can buy what we want, we can go in vacations wherever we want, and so on. With sex, well…you know

My suggestion to solving these two problems is giving money to the users. I’ve already exposed this idea in Advertising Industry Crossroad - why not sharing the money with the consumers?. Let’s look at this now from the Advertising and Communities point of view.

Advertising: the money for ads will be payed without doubt to the ones broadcasting/displaying/printing the ads. So the costs are already in place and this will not change too soon. What if a part of these money will be payed to the users, to the consumers. Let’s say that displaying an ad on TV costs 2 cents for each user that sees it. What if 1 cent goes into the user’s account and the other goes into the television’s account. What if clicking on a link on a web page will make money not only to the page owner, but also to the reader, the one that clicked the link? What if seeing an add on the street can make me money, or hearing some ad on radio can make me money? The money are already payed to the television/radio/web page owner, so there’s no extra expenses. This might be a solution to attract more users. For example I see an ad on TV or on the street, I call a number, I answer correctly to some question, I get payed (this is not new, but probably was not looked at from this angle). Or I click on some links, I earn some money. Or I watch some video, I get some money.

Using this idea, I’ve developed a business plan for my startup, and I’ll share it with you. I’m mostly developing services for Romania, so it’s ok if you use my ideas for your own startup.

Developing a business plan

Giving users stuff for free might sound too weird and they might run away from your services (hey, we have to work hard in life in order to get what we want, right? ). So you have to be careful and do this in really small steps. Start giving them little things, of less importance, gain visibility and trust from your users. Then take it a step further and give them something else, more important, and so on.

My plan contains at least 3 phases:

Phase 1 - SMS Free Service
I’ve started developing a Free SMS Service. The users will be able to send text messages (SMS on mobile phones) to their friends for free. The costs will be supported by inserting short ads at the end of the message.

Phase 2 - Free music & movies download Service The users will have to watch an ad, and at the end they’ll be able to download a song. If they want to download a movie, they will have to watch several ads. Here you’ll have to make sure that they are watching the ads. Otherwise they might leave the computer and come back in 5 or 30 minutes and then download what they want.

Phase 3 - On-line making Service by watching video ads
If you can pay for music or movies when your users watch ads, why not giving the money directly to your users? And maybe you’ll find an ingenious way for them to make important amounts of money by spending only one or two hours in front of the computer.

The concept is so simple that it’s easy to find a lot of other applications where you give stuff for free to your users. They’ll be happy getting it for free, and the advertisers will be happy because their message gets to the consumers.

I’ll detail each one of the three phases above into separate articles.