"I'm not saying you should hire someone to be the brand advocate. It just has to be someone - either the CEO, or VP Marketing, or whoever is responsible for the product. It's a role that has to be filled."
- Andrew Chen
"Exactly - there's a lot to be learned by studying how positive experiences deviate from the mean, but also the reverse. Studying quitters and extreme users in general is a very useful thing. I know that IDEO often has what they call "unfocus groups" in which they invite very extreme users, rather than trying to find representative normal people. And the reason, of course, is because they want as many strong signals as possible from people throughout the spectrum of love vs hate, not just the middle part. Thanks for the comment!"
- Andrew Chen
"Great link! Very interesting, and makes a ton of sense to distinguish the two. Just to excerpt from the article that Rob linked, for readers of the comments: The right goal for a company is to deliver customer experiences of such high quality that customers recognize the value in the relationship and become Promoters. These Promoters generate good profits and fuel true growth. They become, in effect, part of a company's marketing department, not only increasing their own purchases but also providing enthusiastic referrals. By contrast, companies can boost short-term profits by exploiting customer relationships, raising prices when they can get away with it, or cutting back on services to save costs and boost margins. Those practices boost bad profits by extracting value from customers at the expense of loyalty, creating Detractors. Companies can not achieve long-term sustained growth on the basis of bad profits. Conventional accounting can't distinguish a dollar of good profits — the..."
- Andrew Chen
"Absolutely true - and that incentive structure makes it very hard for people who prioritize functionality over virality. I think the Apple App Store has done a good job emphasizing downloads and ratings over viral invites - that's probably the single best way to encourage quality of experience."
- Andrew Chen
"Alex, I'll have to respectfully disagree with you that the customers of publishers are the readers. That's true for properties where the majority of the revenue comes from people actually buying the content, like Consumer Reports. But certainly not true where advertisers pay for the magazine to be written. I think there's a balance here, but I think advertisers are more important than anything else. Here's a scenario that proves my case - if you build an online property that has all international traffic, then no matter how much people love it, you won't find the advertising to support it."
- Andrew Chen
"The best case stuff is explicit data - so you want it to be easy to both give positive feedback and negative feedback. Thus: Positive = after a date, they get a followup where they can give you both quant/qual data about their experience. Or, they quit the service but because they found a match Negative = after a date, they vote negative, or quit and haven't found a match. You want to make it easy to quit your service and delete an account, because that's the strongest signal a user can give that your service sucks ;-) Same with unsubscribes from a mailing list."
- Andrew Chen
"Lonely, or so lonely: http://www.spike.com/video...... Figuring out the quantitative perspective to measure things like human loneliness is what consumer internet so fun ;-)"
- Andrew Chen
"Yes, measuring value proposition for consumers can definitely be difficult - but I think ultimately you have to take a stance on it, and have a strong opinion about what works or doesn't. For a search engine, you want to create a bunch of metrics that try to get at whether or not people found the result they were looking for. For dating, you want to figure out metrics that determine if people are having good dates, and find the right match. This is a hard problem overall, but either way, the number of users that YOU register is probably not the right one ;-) Etc."
- Andrew Chen
"I think I would definitely pay for tools and/or new methods for me to contact my audience. I'd see it as a substitute for things like networking or job recruiting or other things that require a bunch of time ;-) Similarly, if I could grow my subscriber base or twitter followers without degrading the quality of them, I'd definitely pay some $ amount per subscriber. Not sure what that number is, but I'd definitely do it."
- Andrew Chen
"Jun, I definitely agree that case interviews are useful for consulting, specifically, but would wonder how much a case interview style would make sense across different roles. I think it tests a very specific set of knowledge for the consulting industry. Namely, a lot of the industry is about drilling into things (qualitatively and quantitatively), doing research, and presenting stuff back. I'd argue that it's a subtype of my Part 3 set of questions? So for the consulting industry it's great, but for a nontechnical role like a hiring manager, I'd rather just sit them down in front of a computer and see them work, rather than asking them questions. Just the thought off the top of my head..."
- Andrew Chen
"One last nitpick ;-) The distinction you are making that Salesforce has a free product targeted in one direction and then paid products targeted elsewhere to me is the definition of Freemium. The fact it's segmented for different audiences is exactly what drives people to upgrade after their usage expands. I don't think doing Freemium is a matter of whether or not you can afford it. My view is, creating and supporting the Free product is like a marketing expense to drive usage of the Premium product. The question is whether or not you'd rather spend your marketing dollars there versus buying ads or building out a big sales team."
- Andrew Chen
"A couple points: 1) What do you disagree with? ;-) My post doesn't really have a specific thesis or point, it is more recounting a bunch of ideas from a dinner. Are you saying that you disagree with freemium, in general, across all scenarios as a potential strategy? 2) Salesforce actually has a free edition: http://www.salesforce.com/product...... 3) My overall point, discussed by the thread above, it's not that freemium is a silver bullet that works for all enterprise products in all cases. It works for some well-defined scenarios, but ones that are more approachable for web entrepreneurs because you don't need a direct sales team."
- Andrew Chen
"re: "vast majority" - hm, I don't know if I'd go that far. I think one of the big lessons that buyers of enterprise software learned after the 90s is to be wary of directly sold products that the people in your enterprise may not like. There's a higher chance of success to see enterprise tools that get traction at the group, departmental, and higher level, and then do a larger deployment across the enterprise. Now, I still agree with you guys that freemium is not right for type of enterprise product. I think this is especially true for specialized, feature-rich products that are used by a small number of users within a company. But for products that are widely used by the rank and file, freemium has the nice property that it can help you virally spread within a company. It's definitely interesting to contemplate the situations in which freemium is a strong value prop - it's clear that it can go both ways."
- Andrew Chen
"I think the same holds true for consumer-y business apps that have shown success in freemium. Products like anti-virus, remote desktop, storage, etc., are all productivity areas that can be brought into an enterprise by technologically adventurous professionals. Now, I would guess that certain types of products make no sense for freemium, simply because there's no consumer side to it as well. Those are better to be sold direct using big enterprise salesteams, and be premium only,"
- Andrew Chen
"Yep, I think: viral + freemium + $1+ monthly ARPUs + huge market is pretty much the Shangri-la of consumer internet startups ;-) Linkedin certainly has some very compelling aspects in its approach."
- Andrew Chen
"I think surveys are just one tool among many different datapoints you can collect about product roadmaps. Others would include: - competitive comparison - ethnographic research (IDEO style) - A/B testing (sell it before you got it, in Steve Blank's style) - etc. It's a useful tool but I wouldn't overuse it... I personally find surveys more useful once you've drilled pretty far down into your value proposition, and you're asking for very specific things. Otherwise, I generally prefer in-person interviews or phone calls with potential customer candidates."
- Andrew Chen
"I should write more about monetizing search queries sometime - just as one pageview is not worth the same as another, and it depends on factors like geo, demographics, context, frequency caps, etc. - search queries also don't monetize the same. In particular, it's an important issue that a search service get a large % of "commercial queries" which are the bread and butter of search monetization. These are things that people do before buying a service or goods, like product reviews, price shopping, etc. I don't know what the searches on Twitter look like - you would know better than me ;-) But at least for social networks, many of the searches are around names, entertainment, etc., which are not that monetizable. You need people to think that THE place to start a commercial query is a social network (or Twitter), and then you're in the business. I should turn this comment into a blog ;-) IIRC, I went to a Yahoo-sponsored event years back where they publicly broke down their commercial..."
- Andrew Chen
"Yeah, I think the fact Facebook is one of the top properties on the web but making 1/10th what the big portals are making is that they are holding out on the new uber-monetization scheme to make money, rather than depending on remnant ads. We actually did a meeting with Facebook when they just got started and were like 15 people or so? I remember that they were running remnant ads and ran a lot of online poker ads back then ;-)"
- Andrew Chen
"I haven't seen Mint.com's internal analytics so I can't tell you what their traffic sources are and the nature of that traffic. Perhaps you have a lot more information than I have. Even with that said, you may be misinterpreting the argument in my presentation. My point wasn't that non-renewable traffic wasn't a good strategy, my claim is just that the "PR only" strategy is not repeatable for most startups. Putting all your eggs in the basket of being that One Hot Company is not a reasonable plan for 99.999% of the startups out there. My claim isn't that this isn't possible. Clearly PR works well for some small percentage of companies - Twitter and Friendfeed are great examples of this - but it has inherent drawbacks as the strategy of first resort."
- Andrew Chen
"Matt, very happy to hear that! Good job offerpal ;-) Since you guys are leading the market, I think your influence in creating more transparency here is a good thing."
- Andrew Chen