Let’s be clear, I’m not a marketing expert. Unfortunately, I spend a lot of time talking to my business clients about things like marketing when they discuss their small business legal needs. I do it mostly because I need to understand what they are doing to advise them correctly. But I also do it because too many of them haven’t really figured out their business model in their plans, nor thought about the details of revenue stream and marketing.
So I’m not an expert, maybe not even very good at it, but I’ve got some observations.
Tomi Ahonen writes about the global cellular phone business at his blog. He is great for a good rant about smartphone strategy but I love the title of his blog “Communities Dominate Brands” which I think is a book title of his too. And that’s the theme that I’m stealing from him for this blog post.
In a lot of ways, the old method of funding entrepreneurship is dead. Good luck getting a bank to loan you money to start a business. Good luck finding venture capital. Both happen but rarely today.
Today we have a lot of interesting new ways to get together revenue for a project and I want to talk peripherally about one – Kickstarter. The Crowd Sourcing model.
But there are other variations such as the P500 model used by a friend of mine in the game publishing business GMT Games. The idea is to get your customers to demonstrate their enthusiasm for a project or a product by funding its development or manufacturing costs.
And that is where Tomi’s blog title comes in, Communities Dominate Brands.
It used to be that one developed value in a business (what we call “Good Will” in legal and accounting fields) by developing brand recognition. The concept still exists but it has morphed. Today, a business succeeds by building a community that its customers feel that they belong to.
Just last night, a man whose business is publishing a web-based cartoon – “Schlock Mercenary” – put up a Kickstarter project to manufacture commemorative coins (“Challenge Coins” in milspeak). He wanted a minimum of $1800 pledged to do the project (You can find it here on Kickstarter). You can tell that he has succeeded in building community with his web-comic because in 122 minutes his project has not merely achieved his goal of $1800 in pledges … it had received 1000 percent of that goal. Today, a half-day later, he is at 2000 percent – twenty times his goal.
Hence the power of Tomi’s title: Communities Dominate Brands.