CAPITALISING ON DIGITAL CHANGE
RAPID SHIFTS IN ONLINE TECHNOLOGY CAN PLAY HAVOC WITH YOUR BUSINESS MODEL – OR GIVE YOU THE TOOLS TO BUILD A NEWONE.
NO MATTER WHAT BUSINESS YOU’RE IN,
there is always the risk that something could emerge out of left field and undermine growth. The cloud has been one such disruptive force, forcing software marketers to hastily realign their business models. Rather than software being sold as a one-off transaction, it will now be provided as an online service. Other forces at work in the sector are “crowd sourcing” and “growth hacking”.
Two entrepreneurs, one an established business operator and the other a social entrepreneur, know these challenges well. The first is David Vitek, the founder of Viteknologies, which operates online directories in Australia, New Zealand and Britain, including Natural Therapy Pages and Home Improvement Pages. He says the rate of change is increasing.
Vitek, who now has tens of thousands of subscribers across the building trades and among health practitioners, says online technology has made it relatively easy to start a business. “Yet it’s also made things harder. The adaption of technology is so rapid that being the first mover is not necessarily a competitive advantage. Followers can be more nimble, access cheaper technology and thus operate from a lower cost base.”
He has had to adapt his directories business model three times since he began in 2004. Originally a subscriptionbased model in which businesses paid a fee to be listed with a “shopfront” display, it has evolved to incorporate a more focused, cost-per-lead model.
“We had to respond to our customers, who were becoming very precise in tracking the cost of a lead acquired through the directory,” Vitek says. “Also, rapid changemeans you need a more engaged workforce. It’s about energising your employees to be engaged in the growth. There’s a term for it – growth hacking.”
Once a business has a strong foundation, consistent growth rates and a customer base obtaining value from the product, growth hacking is an observational science. “We look at the way people use our products, make a hypothesis about how we can use that to growand then test if our hypothesis is correct.”
US-born, Melbourne-based Gary Conyers is the founder of online social enterprise SoapBoxx, a forumfor all sorts of debates, and says his enterprise utilises all his skills as a marketing consultant and technology developer.
“Most people with a grievance shrug their shoulders and say: ‘No one will listen to me.’ Last year, I made an online purchase from an Australian-based business and they didn’t deliver the goods to me. I asked for my money back – to no avail. I walked into a police station and was told it’s not a crime. You can buy something, they don’t deliver and there’s no law against it. Amazing. I felt like the little guy and I thought: I can’t be the only one.”
Conyers looked to crowd sourcing for a way to give voice to such concerns. Crowd sourcing is distributed problem solving. By farming out tasks to a large group of people, you are able to mine collective intelligence and do process work in parallel. “I thought this was a way to get a lot of people agitating for change.”
The business was designed to address a widespread feeling of dissatisfaction with the main political parties and elected representatives. “While we can shop, chat, study and transfer money with the touch of a button, local, state and federal politicians seem stuck in the past, preferring timeconsuming, out- of- date and out- of-touch tools that can make it hard to talk to them.
“Whether it’s [about] how to restore unwalkable footpaths, repair undrivable roads or get medicines to remote hospitals, politicians really want to know what you think. And that explains the need for SoapBoxx. Anyone can post an idea or vote for free. Through the platform we’re sharing people’s needs and concerns. And it’s so contemporary, creating an enlightened digital citizenry.”
SoapBoxx will forward any debate that receives enough responses to the relevant politician. The enterprise is a departure from Conyers’ normal entrepreneurial ventures.
“I’ve been involved in self-funded enterprises since the 1990s. I’ve cut my teeth on technology. I came up with and produced a simple iPhone app called Mazi, which connects everyday people with not-for-profits around Australia.”
Operating as a not-for-profit has the obvious challenge of revenue. The business model is to encourage ordinary people to join as users. Initially, they will be asked to finance SoapBoxx through donations. Conyers aims to achieve critical mass within 18 months.
“Once the user community is big enough, I may sell political policy ad space. Online campaigning sites that focus on petitions are big in the US andBritain. SoapBoxx is different because it’s about gaining public support through debate fromall sides, not about finding like-minded people.”