“If you’re not paying for the product, you are the product” is a truism that Yahoo! wants to monetize with its $1.1bn cash purchase of Tumblr blogging platform.

With 108m bloggers generating 13 billion page views per month on the NSFW-oriented (Not Suitable For Work – read – adult content) Tumblr, Yahoo! is hoping to turn eyeballs into advertising revenue (perhaps using its other recent purchase Summly to curate and summarise Tumblr topics).

Will it work where Yahoo! has failed in the past (think Geocities, del.icio.us, Flickr..)?

The challenge is simple - convert Tumblr into profitable advertising space.  But the solution is less evident.

Tumblr generated just $12m in revenue in 2012 – valuing the company in the real world at $36m – not $1bn. If plastering pixel-spam on Tumblr dashboards and posts was a really good idea, wouldn’t Tumblr have done it already? Facebook has held off haemorrhaging users by not turning Instagram into advertising space (yet), and Google has gone on record promising not to pollute Glass-vision with ads. Perhaps Yahoo! has something different up its sleeve – more than old-style interruptive advertising imported online? But given the ‘adult’ nature of much Tumblr content, how many big advertisers would want to take the PR risk advertising alongside explicit content?

So what if Yahoo! pivots Tumblr away from advertising and towards commerce?  We’re not talking the roaring trade that Tumblr could do in selling ‘adult toys’ and ‘adult content’ – but a bigger social commerce opportunity… Here are three ideas;

1. Since so many Tumblr blogs are themed (most fetishes appear to be covered), could Yahoo! allow bloggers to post a ‘shop’ button on the blog’s menu, that picks up the ball that Google shopping recently dropped with a decent price comparison/top picks).  A revenue share with Tumblr users – a la YouTube – could work? Think Google Shopping 2.0
2. Building on the themed nature of Tumblr blogs, the blogging network would make a ideal platform for a new generation of group-buy commerce – allowing like-minded people to come together and get great prices if they buy in bulk. Think Groupon 2.0
3. The simplicity of Tumblr would make it ideal as a next-generation e-commerce platform, making it easy to sell their stuff to communities of people passionate about a subject.  Tumblr has a real opportunity to tie this content + commerce knot, and become a leading e-commerce solution.  Think Etsy 2.0

Why? Because, on a 10 point reputation scale, 1 point difference is worth $500m for large corporations*.

Here’s the deck from a recent course we ran on brand reputation management and social media.  How to use social media to manage your reputation – what people say about you (or your brand) when you leave the room.  Unlike other courses, we hope you’ll enjoy the fact that the solution has nothing to do with creating social spam and polluting peoples news feeds.

There are smarter ways to manage your reputation in social media…  Enjoy, download – and feedback welcome.

* Black, E., T. Carnes, and V. Richardson (2000). ‘The market value of corporate reputation,’ Corporate Reputation Review, 3(1), 31-42.

Here’s a list of key statistics on the Post-PC era, put them together in preparation for a keynote at SYZYGY‘s conference later this month on digital innovation.  In the spirit of sharing, we thought you’d find them useful.  Bottom line, for digital innovation in or out of the social sphere, focus efforts on creating Post-PC experiences. Need convincing? – Check out these stats.

The Post-PC era is a market trend involving a decline in the sales of traditional desktop and notebook personal computers in favour of post-PC smart connected devices such as tablets, smartphones and sensor-based gadgets. Post-PC devices are characterised by connectivity and portability, natural interfaces and sensor inputs, and often make use of cloud technology.

PC Decline

• Global desktop PC share of smart connected device market (PC + tablet + smartphone) declines in 2012 to 12.4% (148M shipments) SOURCE IDC http://www.idc.com/getdoc.jsp?containerId=prUS24037713#.UVLrQirKde0
• Global notebook PC share of smart connected device market (PC + tablet + smartphone) declines in 2012 to 16.8%  (202M shipments) SOURCE IDC http://www.idc.com/getdoc.jsp?containerId=prUS24037713#.UVLrQirKde0
• Global PC shipments were overtaken smartphone and tablet shipments in Q4 2010 SOURCE KBPC (Dec 2012) http://www.slideshare.net/kleinerperkins/2012-kpcb-internet-trends-yearend-update
• Global installed base of PCs will fall behind smartphone and tablets in Q2 2013 SOURCE KBPC (Dec 2012)  http://www.slideshare.net/kleinerperkins/2012-kpcb-internet-trends-yearend-update
• By 2013, global tablet sales will exceed desktop PC sales (142,1M vs 190.91M shipments) SOURCE IDC (Mar 2013) http://www.idc.com/getdoc.jsp?containerId=prUS24037713#.UVLrQirKde0
• By 2014 global tablet sales will exceed desktop PC sales (210.8M vs 236.3M shipments) SOURCE IDC (Mar 2013) http://www.idc.com/getdoc.jsp?containerId=prUS24037713#.UVLrQirKde0
• In Q1 2013, global PC shipments dropped 11.2% (year on year) to 79.2 million units SOURCE Gartner (Apr 2013) http://www.gartner.com/newsroom/id/2420816
• In 2013, Facebook was receiving fewer PC visitors than mobile visitors SOURCE The Verge (Jan 2013) http://www.theverge.com/2013/1/30/3933912/facebook-q4-2012-earnings
• Android and iOS devices outsell Windows devices in 2012 (45% vs. 35% – Global Market Share OS Shipments) SOURCE KBPC (Dec 2012) http://www.slideshare.net/kleinerperkins/2012-kpcb-internet-trends-yearend-update
• In India, mobile internet traffic has already surpassed desktop traffic (May 2012)  SOURCE KBPC (Dec 2012) http://www.slideshare.net/kleinerperkins/2012-kpcb-internet-trends-yearend-update
• Hybrid PC/tablet Microsoft Surface is plagued by low sales and high return rates SOURCE CNET (Jan 2013) http://news.cnet.com/8301-10805_3-57566759-75/microsoft-surface-sales-well-below-shipments-says-isuppli/

Smartphone Rise

• Smartphones are spreading faster than any technology in human history (5% to 40% in four years) SOURCE MIT (May 2012) - http://www.technologyreview.com/news/427787/are-smart-phones-spreading-faster-than-any-technology-in-human-history/
  
• In 2012, smartphones represented 60.1% (722.4%) of the smart connected device market (PC + tablet + smartphone), and is forecast to rise to 67% (1,516M units) by 2017 SOURCE IDC (Mar 2013) http://www.idc.com/getdoc.jsp?containerId=prUS24037713#.UVLrQirKde0
• By early 2012 in Germany, mobile penetration had already exceeded PC penetration SOURCE Google (Mar 2013) - www.thinkwithgoogle.com/insights/uploads/940736.pdf/download/
• By early 2012 in Germany,  43% of smartphone owners were already multitasking with their handset whilst watching TV SOURCE Google (Mar 2013) - www.thinkwithgoogle.com/insights/uploads/940736.pdf/download/
• Smartphone subscriptions in Germany rose 19% (Q4 2012 year on year) to 23% of all mobile subscriptions SOURCE KBPC (Dec 2012) http://www.slideshare.net/kleinerperkins/2012-kpcb-internet-trends-yearend-update
• It took landline telephones about 45 years to get from 5 percent to 50 percent penetration among U.S. households, and mobile phones took around seven years to reach a similar proportion of consumers. Smartphones have gone from 5 percent to 40 percent in about four years SOURCE MIT (May 2012) - http://www.technologyreview.com/news/427787/are-smart-phones-spreading-faster-than-any-technology-in-human-history/
• On US shopping day, Black Friday 2012, mobile and tablet shopping accounted for 24% of all US online shopping, up from 6% two years ago SOURCE KBPC (Dec 2012)  http://www.slideshare.net/kleinerperkins/2012-kpcb-internet-trends-yearend-update
• According to Cannacord, Apple generated 57 percent of the smartphone handset industry’s profits during the first quarter 2013, leaving 43 percent to Samsung SOURCE CNET (May 2013) http://news.cnet.com/8301-13579_3-57582991-37/apple-samsung-again-take-all-of-handset-industry-profits/
• Android (70%) and iOS (21%) combined for 91.1% of the global OS Market in 4Q12  SOURCE IDC http://www.idc.com/getdoc.jsp?containerId=prUS23946013#.UVIJchzvuPs
• More people buy Android devices than iOS (70% vs 21% Q412), but iOS accounts for over 61% of mobile web traffic (Safari for iOS)   SOURCE Wired (Apr 2013)

Tablet Rise

• In 2012, the tablet device category growth rate was 80% with an estimated 128 million tablets were shipped worldwide – Deloitte - http://www.deloitte.com/assets/Dcom-UnitedKingdom/Local%20Assets/Documents/Industries/TMT/uk-tmt-media-consumer-scatter-cushion-device.pdf
• 48% of children wanted an iPad for Christmas 2012 SOURCE KBPC (Dec 2012) - http://www.slideshare.net/kleinerperkins/2012-kpcb-internet-trends-yearend-update
• 2013 - http://www.gartner.com/newsroom/id/2420816
• Tablet shipments grew 78.4% year-on-year in 2012 to hit 128 million units and are forecast to surpass the shipments of both desktops and portable PCs in the next 24 months IDC March 2013 - http://www.idc.com/getdoc.jsp?containerId=prUS24037713#.UVLrQirKde0
• On US shopping day, Black Friday 2012, mobile and tablet shopping accounted for 24% of all US online shopping, up from 6% two years ago SOURCE KBPC (Dec 2012)  http://www.slideshare.net/kleinerperkins/2012-kpcb-internet-trends-yearend-update

Other

• Mobile visitors have a 9.56% higher bounce rate than desktop visitors SOURCE Shareaholic (Oct 2012)  http://blog.shareaholic.com/2012/10/mobile-website-traffic-2012/
• 48% of large company CEOs (revenue > $250m) do not have a digital strategy SOURCE Gartner (Apr 2013)  http://www.gartner.com/newsroom/id/2415615
• Smartphone subscriptions in Germany rose 19% (Q4 2012 year on year) to 23% of all mobile subscriptions, SOUCE KBPC (Dec 2012) - http://www.slideshare.net/kleinerperkins/2012-kpcb-internet-trends-yearend-update
• Shipments of ebook readers by year-end fell to an estimated 14.9 million units in 2012, down a steep 36 percent from the 23.2 million units in 2011 SOURCE  iSuppli (Dec 2012) http://www.isuppli.com/Home-and-Consumer-Electronics/MarketWatch/Pages/Ebook-Readers-Device-to-Go-the-Way-of-Dinosaurs.aspx

Worldwide Devices Shipments by Segment (Thousands of Units)

SOURCE Gartner http://www.gartner.com/newsroom/id/2408515

Worldwide Devices Shipments by Operating System (Thousands of Units)

SOURCE Gartner http://www.gartner.com/newsroom/id/2408515

Smart Connected Device Market by Product Category, Shipments, Market Share, 2012-1016 (units in millions)

Tesco has launched a new social commerce site for wine, Tesco Wine Co-buys.

Using Buyapowa social commerce software, consumers can club together to buy wine in bulk at discounted prices. What we particularly like is that it appears to be demand led; customers are able to choose wines they want to buy together in bulk – and set a maximum price they’d be willing to pay.  The more people that sign up, the heavier the discount – with the person who recruits the most co-buyers – via social sharing – getting a case of wine for free.  Sweet.

In the PR blurb, Tesco director of digital and social Tom Daniell says: “This channel really puts customers in control – from determining the final price they pay, to telling us the products they’d like to see featured.” Now you know. But the point is well made.  This is social commerce for the empowered customer.

We think Buyapowa is one of the few social commerce software companies that really ‘gets’ social commerce. First, it’s about commerce – i.e. shopping, not conversations, And second, it’s social, and that does not mean social spam from retailers or their customers, but shopping together as a social activity. Buyapowa gets this, and its software delivers by helping people shop together to get value.   And that is what the Tesco brand is about – value.

But if the new site is to be a success, Tesco is going to have to brand Tesco Wine Co-buys better – it really should look more like this or this, and it needs to offer value in more ways than just savings – access, appreciation and advice – will be key.

Right now – the ‘site’ straddles two sites – with users having to flip between Tesco.com and Buyapowa.com site to participate.  Apart from burgundies turning blue and tahomas turning to helvetica, it’s unclear what’s happening where. If we were involved, we’d be recommending Tesco consider using their wine club, currently hidden on the site, with a fresh new feel (again – look at NakedWines – they get it) as a vehicle for this initiative.  The idea is good enough to warrant this.

Whatever Tesco decides, they’ll need to avoid making this initiative look like a temporary promotion – and steer well clear of Groupon-style promotional cues – we’ve been there before and it didn’t work. Instead it should be looking at the new generation of e-commerce wine site like NakedWines 0r ClubW, which just raised $3.1M. But if Tesco decides to develop social commerce for wine, it has the muscle to trail blaze, and grow the site into a major e-commerce wine destination.

Business books are already being updated, with the Coca-Cola ‘New Coke’ catastrophe being replaced with the newer story of Microsoft Windows 8.  The lesson is the same – too much innovation can backfire.

Back in 1985, with Pepsi winning the hearts and mouth’s of the youth generation and a market share slipping from a post-War US high of 60% to 26%, Coke reformulated Coca-Cola with a new taste that won hands-down over the old flavour in blind taste tests.  Following the April 23 launch, a marketing disaster and consumer and media backlash ensued, including a much publicised complaint letter to CEO Roberto Goizueta, addressed Chief Dodo, The Coca-Cola Company.  Less than three months after launch, Coke pulled New Coke and reverted to the old flavour.

Fast forward to 2012, with iOS and Android devices winning the hearts and fingers of the new digital generation and a market share slipping from  97% in 2000 to 20%, Microsoft reformulated its Windows OS with a new interface  that won hands-down over the old version as the “People’s Choice Design” .  Following an October 26 launch, a marketing disaster and consumer and media backlash ensued, although there was no much publicised complaint letter to CEO Steve Ballmer, addressed Chief Dodo, Microsoft Corporation.  But less than six months after launch, in May 2013, Microsoft announced it would pull key elements of Windows 8 and “reverse course” with a back to old-style Windows – codenamed Blue.

So what can social commerce learn from Chief Dodo Ballmer’s experience?

• Compatibility: Windows 8 is struggling because it is not compatible with people’s existing habits; it forces people to unlearn what they already know and do: LESSON – Don’t try and change entrenched shopping habits, focus instead areas where there is no set way of doing things (mobile/tablet shopping)
• Complexity: Windows 8 fails by being too complex, with no simple architecture of design that makes for intuitive adoption: LESSON – Keep it simple – the social commerce of the future will have simplicity at its heart
• Relative Advantage: It’s not immediate how Windows 8 is an improvement over what’s already available (Android, OS, iOS – Windows Vista ?!): LESSON – Be better, not just different. Sure social commerce is a new way of selling, and for consumers a new way of shopping.  But unless it is blatantly clear why it is better, it won’t be adopted
• Observability: With slow take-up by PC manufacturers and little in the way of product placement, you don’t see much social proof of Windows 8 out there, especially of the opinion leading kind: LESSON – Product seeding and product placement are key – you may not get your product into the latest Psy hit like Candy Crush, but do whatever it takes to get your product or service into TV, movies or clips – as a character not an ad
• Trialability: Windows 8 creates prisoners not passionistas by forcing a big risky jump into a new start-button-less world of charms, sliding panels and hiding functionality: LESSON – Offer bite-sized trials for people to try risk free, and then allow them to move frictionlessly away if they want.

So a guy is into you – whether you are a person or a brand – and then he isn’t. What’s going on?

Solomon Asch (1907-1996), one of the pioneers of social psychology ran some ground-breaking experiments into why men change their mind, and it’s very relevant to social media, and it’s all about conforming to group norms.

So on the back of insights last week from Kurt Lewin on the potential of discovery in unlocking the commercial potential of social media, today let’s turn to Polish psychologist Professor Solomon Asch.

Asch, with a PhD from Columbia University who worked at Swarthorne, MIT, Harvard and Penn, was famous for asking men to take a simple visual test; view pairs of cards, one showing three straight lines, and the other a single line – and identify which line on the first cards matched the length of the line on the second cards. Unlike similar visual tests, like those run by fellow psychologist Muzafer Sherif, the correct answers to Asch’s test were self-evident and blatantly clear. In 720 trials, only three mistakes were made. But then Asch re-ran the tests, this time putting 123 male test subjects into groups of 6-8 before asking them to identify matching lines. This time 75% of test subjects gave the wrong answer!

Why? Because Asch had manipulated the test, putting ‘stooges’ (‘confederates’) into the groups who were instructed to publicly give the same wrong answer before the real test subjects gave theirs. Either doubting their own judgement, or not wanting to be seen as wrong, test subjects conformed to the fake group view nearly a third of the time (32%).

So men, it would appear, change their minds to conform with a group majority or unanimity. But what was particularly interesting about Asch tests is that that some men, about one in four (24%) appear to be immune from the psychological pressure to conform, and that for most men the pressure to conform evaporates once there is dissent voice in the group. Men are influenced by group pressure when there is group unanimity, or at least a sizeable majority. Break the unanimity, then you break the pressure.

The commercial – and indeed political – implications for social media are clear; first think of people in terms of groups, not individuals – identify groups where conformity is already high and use social media to sell products that build on that conformity. Or, if conformity is standing in the way of selling what you have to sell, use social media to show a wide divergence of existing opinion and behaviour – and you’ll break the pressure to conform and open up the possibility of making the sale.

Oh and if you want to get your guy back, break the unanimity of dissent that exists about you among his friends.