Is this Idea a Good Business Idea?

I had coffee with a couple friends this morning on the beach in Barcelona.  I live only 2 minutes walk from the beach and these guys are my neighbors.  They have an idea for an online business and wanted to get my opinion regarding how to pursue the idea and if the idea was a good business idea.  This is the summary of my response to this question.

I don’t really believe in the concept of a good business idea or a bad business idea.  Every entrepreneur has his own vision of their idea and why the idea would be successful.  I have see what I thought was a good business idea surrounded with great technology fail miserably.  And equally I have seen far fetched ideas become a success.  The main factor in either case has been the founders of the business themselves.

Cool Mojito – Social Media Marketing. More Likes, More Leads, More Sales

rSitez – Create your own Social Networking Website

When I think of business ideas, what is really important is how committed and available the founders are to making the idea a success.  In many cases Plan A will fail, simply because it’s often hard to tell how cold the water is until you jump into the lake … so to speak.  At that point it’s really how well can you swim.  Can you come up with a Plan B or even a Plan C if needed?

Entrepreneurs ability to be creative in making their business a success in a difficult time was tested severely in the last 3 years.  Many businesses that seem to be stable fell apart and other businesses flourished.  Last year during the middle of the crisis our business more than doubled revenue and profitability.  I think we were able to do this because we were able to implement Plan B and even Plan C when the getting got rough, and we created opportunity out of chaos. We’re doing the same again this year.

So is this business idea a good idea or a bad idea?  In the end, it really has to do with you the entrepreneur.  Do you have what it takes to make your vision a success?

Everything I Needed to Know about Social Media, I Learned in Kindergarten

When we start marketing and networking on social media sources like Facebook, Twitter, LinkedIn, we sometimes forget some of the simple rules of engagement.

In his book, “Everything I Needed to Know, I Learned in Kindergarten,” author Robert Fulghum reminded us of the basics of getting along with others. Although it was originally published in 1989, his observations are timeless.

Even in our high tech world, we can look back at some of the lessons we learned in elementary school, and see that it applies to establishing successful relationships online.

1. Don’t be bossy. If you are a small business owner or entrepreneur, chances are you are bursting with excitement about your product or service. You want to shout its praises from the rooftops. But when you are building tenuous relationships with others, especially across the Internet, you need to take a more subtle approach.

Instead of delivering a heavy handed sales pitch, focus on your customers and what they need. What problems are stumping them? What is costing them time, energy and efficiency? Then, let them know how your products or services can help.

Cool Mojito – Social Media Marketing. More Likes, More Leads, More Sales

rSitez – Create your own Social Networking Website

2. Don’t say anything you don’t want your mother to hear. Although social networking has a casual element, keep in mind that you are building a reputation online for your business. Be careful before disclosing too much personal information or getting caught up in controversial discussions. If someone posts a negative comment on your blog, don’t immediately shoot back a flaming response. Mom wouldn’t like that.

3. Listen to others. The whole purpose of social media is to get others to interact with you. That means you have to create an environment where people want to respond. If you have your own blog, you can do this by asking questions. You can visit other blogs and find out what others are thinking and join that discussion.

If you have your own social networking site, like ones offered at rSitez, you can start a community discussion through blogs, forums, and chats. Once you’ve gotten your readers talking, listen to them and let them know you appreciate their interests.

It sounds simple, but how many times have you clicked on a website looking for information and been inundated with heavy sales copy? Or read a blog where the author dismisses comments that contrast his? Or see where someone says something completely inappropriate on Facebook that diminishes your view of him?

By remembering the basic social rules that you would use in establishing face-to-face relations, you’ll have success in creating relationships online.

Does Social Media Work for Small Businesses?

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That’s the question Citibank asked in a recent survey and the answer it got?  No.  Many small business leaders said that they did not see results from their efforts on social media sites such as Facebook and Twitter.

Over 60% of the 500 respondents said that social networks did not help generate leads.  Only 12% found social networks somewhat or very helpful, and 13% said they were not very helpful.

Why does it seem to be all the rage for larger organizations, but not so much for smaller ones?  Here are some of the stumbling blocks that small businesses may have when it comes to social media.

1. It takes time to get results.  The whole aspect of social media is about building relationships, and that can’t be done over night.  If a small business starts a Facebook Fan page or a blog and hopes for immediate results, she will be disappointed.

2. It takes up time.  Small business owners have a lot to do just in running their business.  Building and maintaining online social networks takes time and consistency.  And, unlike larger organizations with more staff members to delegate to, in a small business, it’s hard to let someone else convey the corporate message.

3. It takes resources. Not only do small businesses need manpower to handle the online communication, they also need sources of information and research in order to establish that role of a “thought leader.”  Large companies can do surveys and hire researchers to write innovative white papers, but with their limited budgets and staff, it’s more difficult for small businesses to offer new and fresh information.

4. Some businesses may make a half-hearted entry.  For the businesses that are doing social media because they are “supposed” to, it won’t take much to convince them it won’t work.  The company president may have a LinkedIn.com account, but has few connections and doesn’t strengthen those or build more.

Cool Mojito – Social Media Marketing. More Likes, More Leads, More Sales

rSitez – Create your own Social Networking Website

5. Lack of hard results.  It’s true.  Most of the stories of success using social media are anecdotal.  Factual, but not always in hard numbers.  So it’s difficult sometimes to show the actual benefits of using it.  How do you know, for example, that a potential customer decided to call you because he saw you on Facebook?  Can you measure the amount of people who developed a favorable impression of you after reading your blog?

Despite the negatives from this survey, social media experts are sure that small businesses can benefit from this form of marketing.

Mashable, a website specializing in social media, countered with several examples of small businesses that have seen sales growth and increased brand recognition through their social media efforts.

Other examples abound throughout the Web, from the success of Chicago’s Sprinkles Cupcakes on its Facebook fan page to the non-profit organization Epic Change and how it effectively used social media for fundraising.

But maybe there’s another option.  Maybe small businesses could use a different type of social networking system that’s more tailored to their size and need for flexibility.  rSitez, a software development company, helps entrepreneurs and small businesses create their own social networking sites by taking the best attributes of the popular sites and blogs and tailoring it to the individual company’s needs.  In effect, they create a community for each company, making it much simpler for businesses to reach their target audience.

Where are you on the social media spectrum?  Have you been using it for years?  Thinking about testing the waters, or somewhere in between?  What results have you seen?
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Social Networking Opportunities in a Recession

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Almost a year ago, Josh Bernoff wrote the post “Why Social Applications Will Thrive in a recession”. You can check the original post here. Josh is co-author of the great book Groundswell, a must for anyone interested in social technology.

A year ago, we could argue if a recession was arriving or not, today we know a recession is here to stay.  Therefore, I think is worthy to revisit what Josh said about Social Apps then and what opportunities rSitez and other Social Networking Software providers have to offer in this tough economic times.

In a recession, advertising will plummet and experimental media will crater. (In the 2001 recession, US advertising dropped 9% and Internet advertising plummeted 27%, according to Veronis Suhler Stevenson.)

But do not panic. Things are different this time.

Cool Mojito – Social Media Marketing. More Likes, More Leads, More Sales

rSitez – Create your own Social Networking Website

Here’s what smart marketers should know:

  • It’s not a tech bubble. The last recession was caused by the dot-com bubble and the terrorist attacks. There was a lot of ignorant money out there chasing illusory opportunity, and companies had overinvested in technology. This time, the precipitating event is a housing bubble, and technology spending is not irrational.
  • Awareness ads will lose effectiveness. Advertising (or as we often call it, “shouting”) is mostly about generating awareness and reinforcing brands. In a recession, ordinary consumers like you and me aren’t as willing to spend. Sure, we’ll be aware of the product, but that doesn’t make so much difference when you’re worried about your future. Advertising is expensive and is a lot easier to cut than headcount. Many are predicting ad spending will hold up; I’m not so sure.
  • But social applications are about consideration, not awareness. Blogs, word of mouth, social networks . . . they’re about people connecting with other people. You may resist advertising if your finances are tight, but if your bud tells you that new movie is really worth seeing or that the Gap has the cutest new tops, that’s more persuasive than advertising. Basically, in a recession, the consideration phase is more important than awareness — and that’s where advertising flops and social applications succeed.
  • It’s cheap. Social applications can be cheap (think blogs, rsitez.com, facebook pages) and even more sophisticated communities are typically between $30K to $200K — a lot cheaper than a significant sized ad campaign. One interactive marketer from a highly cyclical company told us this:

“Budgets are tight in light of the economic conditions as you surmise, but [the budget for social applications] has not been impacted. We are still keen to move forward with our trial and have support….at this point anyway.  Interactive in general has been more protected than other comms areas and saw an increase.”

  • It’s measurable. Marketers want to spend their budgets in effective channels. If you can generates leads, or conversions, or buzz, or something useful and your Social application offer measurable output. That won’t get cut in a recession.

These same arguments apply to some other forms of online marketing, including search ads and email marketing. As a conclusion, if you are smart and you are looking for opportunities to make money online, social networking applications are going to be good investments in a recession.

rSitez provides you with the technology to create your own Social Networking Site so you can focus in your audience. Find a good niche or audience, position yourself now, proof that your that social networking site is getting results and collect the fruits.  Because as the ad dollars get tight marketers will be looking for you.

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Twilight vampire books – How authors use social media

On his last number, Business Week presents a great article about the Twilight Vampire books and how author Stephenie Meyer used online social media to reach her fans and create a huge online marketing spiral. Her great success will be reflected with Breaking Dawn, the last of the four-book series, that came out on Aug. 2, this release is expected to surpass all her previous efforts, with an initial print run of 3.2 million copies.

What is important about this article is that explain that Meyers success isnt due simply to her vivid imagination for vampire romance. She also figured out before almost anyone in the book industry how to connect with readers over the Internet and inspire them to build on her work. Since Meyer published the first Twilight book in 2005, she has reached out to readers on social networking sites, such as MySpace (NWS), and participated in online discussion groups. Fired-up fans have championed her books on Amazon.com (AMZN) and set up their own sites, such as Twilight Lexicon and TwilightMOMS. That has helped propel sales of the series to 7.5 million books. “Other authors have pockets of fans online, but nothing to this extent,” says Trevor Dayton, a vice-president at Indigo, Canada’s leading bookseller. “Stephenie Meyers Twilight series is the first social networking best seller.”

Executives in the book industry have long understood that the Internet can help authors connect with fans, of course. Major releases are usually backed by author videos, a Web site, and interviews with influential book bloggers.

But Meyer, a 34-year-old mother of three from Phoenix, went well beyond standard marketing. She engaged with online readers to answer their most detailed questions about the star-crossed lovers, Edward Cullen and Bella Swan. She put up her own Web site, in addition to the one by her publisher, Little Brown Books for Young Readers, posting her personal e-mail address and family photos.

Meyer’s readers have responded by creating an entire world of Twilight on the Web. Cousins Chris McElvogue and Georgina Tena launched Twilighters.org last year to discuss the books with other readers.Inspired online marketing is key to the astounding success of Twilight, a series of vampire novels.

Is Meyers a marketing guru? Maybe the book industry thinks so, I don’t. I believe she just see the benefit of social networks to be in touch with her readers and her readers respond positively to this human approach. The ability of touching millions of people is making social networking a powerful tool that relies in the fundamental principles of human nature.

If you are an author, try to answer these questions:

Are you afraid to know first hand what people think about your work?
Are you afraid to let people use your work to create parallel histories?
Are you afraid to see your work spreading in unexpected ways?

If the answer is : NO

You should consider to create your own social network site, let your fans interact with you, let your work to be share by millions and the best…have fun doing it.



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