1. Web 2.0 and Social Media - Key Strategy Tools and Concepts

2. Exploring the new World of Co-Creation
Nike Joga Bonito
Nike Chain
What is the difference?

3. Co-Creation
What does this mean?

4. Co-Creation
The Stimulation and Appropriation of Customer Work (e.g., youtube, facebook, etc.)
The emphasis of source credibility (Amazon)
Innovation and product quality

5. E-Marketing and Co-Creation
Marketers don’t create Products
They create Platforms for Production
“Open-source marketing”
Wikis, forums, communities

6. Miller’s Man Laws
A ridiculous invention but one that obeys the e- marketing law of the 21st century.

7. Snakes on the Plane Sound track challenge Winners More stuff And more…
Aaaand more…

8. Uncontrollable
General Motors ran a video-creation contest for its Chevy Tahoe truck.
Not just positive submissions
While GM can suppress unauthorized video on its own sites, it can do little to contain the viral spread of clips on sites like YouTube.
Consumers submitted more than 30,000 ads, resulting in 5.8 million page views.

9. In the 21st century, e-marketing is about:
Offering platforms for consumer driven (knowledge & idea) production, communication, design, and innovation.

10. In Teams, think: In a world of e-marketing through co-production
How does branding change?
How does new product introduction change?
How does new product development change?
How does channel strategy change?
How does promotion change?
How does pricing strategy change?

11. Mass Collaboration and Crowd-sourcing: How does the Internet help Innovate?

12. User Innovation Community
user-community in which information, assistance, and innovations are freely shared.
Open source communities (Apache, Linux, Apple)
Innovation communities: InnoCentive, Kitesurfing
Open source hacker communities (Apple)
Brand communities (Coca Cola, Harley Davidson, LEGO, or Barbie)

13. Instant Messaging is a User Innovation
By 1987 MIT Lab for Computer Science had thousands of workstations online and difficulties diffusing system admin info rapidly.
Developed “Zephyr” instant message system.
MIT students begin to use for general instant messaging
By 1990, other universities adopted Zephyr-like programs
First Commercial Product 9 years later
1996 Israeli firm Mirabilis put out product ICQ
1998 Mirabilis acquired by AOL

14. Ongoing evolution of Wi-Fi
User Activities starting around 2002
Users discover possibilities and begin free sharing of wireless networks
Users Modify Wi-Fi antennas to greatly increase range
Widespread implementation occurs – travelers find “hot spots” as they travel, can get Internet access, send from the highway etc.
Traditional Supplier Responses?
No one will want it
no network security
We think this might be service stealing… should stop.

15. Examples of Important Consumer Product Innovations

16. User and Manufacturer Innovations Differ
Users tend to develop Functionally Novel innovations:
The first sports-nutrition bar
The first scientific instrument of a new type
Manufacturers tend to develop Dimension of Merit Improvements:
A better-tasting sports-nutrition bar
Improvements to an existing type of scientific instrument

17. Effect of Lead user Innovation
“3M products based on lead users, are 8 times higher in sales than market research driven innovations.” (von Hippel, 2005)

18. Customers involvement in the product development process:
especially in idea generation, product conceptualization, prototyping
We know that online user communities allow a firm to leverage the creativity of its customers in all stages of the product development process.

19. Long Tail (Chris Anderson)
Fragmented Demand
Niches are Riches

20. What is “Natural Demand”?
The “Head” of the Demand Curve:
Pre-Internet, old economy firms turned out a small number of “hits” or blockbuster products
The “Tail” of the Demand Curve:
Internet-era, new economy firms offer a broader range of niche products.

21. The Long Tail: Key Claims
In the long tail model, these forces allow online businesses to greatly increase the variety of their products.
Anderson argues that 98 percent of a long tail business’s products sell at least one unit in a quarter
on a cumulative basis, these small numbers of sales of large numbers of niche products generate enormous revenues and profits.

22. Is there a Long Tail?
hosts more than ten thousand reviews and its Web traffic statistics show that even the most popular film represents less than 1 percent of their business.
In June 15, 2006, "The Da Vinci Code" and "Brokeback Mountain" were tied at 0.8 % of page views
the next most requested reviews in 2006 were for "V for Vendetta" (0.7)
"X-Men: The Last Stand" (0.6)
"An Inconvenient Truth" (0.5).
The lesson: People are curious about a lot of different movies."

23. Is there a Long Tail? The Long Tail of Holiday Music.
eMusic had 1,226 holiday albums in the catalog
1,128 had been downloaded over the Christmas season.
That's 92% of the catalog!
Source: Digital Audio Insider, 2007

25. To Summarize:
In virtually all markets, there are far more niche goods than hits
The cost of reaching those niches is now falling dramatically.
Simply offering more variety does not shift demand by itself. Consumers must be given ways to find niches that suit their particular needs and interests. A range of tools and techniques—from recommendations to rankings—are effective at doing this.

26. To summarize con’d
The demand curve flattens. There are still hits and niches, but the hits are relatively less popular and the niches relatively more so.
All the niches add up.
the natural shape of demand is revealed.