I look forward to reading Clay Shirky’s new book, Here Comes Everybody: The Power of Organizing Without Organizations. Until then, this video of his lecture at Harvard’s Berkman Center provided me a thought-provoking overview.
The nut… the internet allows for “ridiculously easy group forming,” which improves…
But this doesn’t do his ideas justice. I’m especially interested in how much of Front Porch Forum‘s experience maps onto Shirky’s conceptual framework. Many of our online neighborhood forums, upon reflection, have followed the four steps above.
UPDATE: See comments below.
Several compelling bits from J.D. Lasica’s posting at PBS.org/MediaShift/IdeaLab today…
As newspaper analyst Dave Morgan observed last year: “Ad revenue in most large newspaper markets will keep dropping 3-5% per year for the next five years. Real circulation — excluding the tons of papers dumped on schools, hotels and the constantly-churning “free ten-week trial” — will keep dropping 3-7% per year for the next five years.”
And…
On Friday, Beatblogging.org’s David Cohn pointed to Clay Shirky’s new book, Here Comes Everybody: The Power of Organizing Without Organizations, and quoted this excerpt from Shirky’s book:
A good deal of user-generated content isn’t actually “content” at all, at least not in the sense of material designed for an audience. Instead, a lot of it is just part of a conversation.Mainstream media has often missed this, because they are used to thinking of any group of people as an audience. Audience, though, is just one pattern a group can exist in; another is community. Most amateur media unfolds in a community setting, and a community isn’t just a small audience; it has a social density, a pattern of users talking to one another, that audiences lack. An audience isn’t just a big community either; it’s more anonymous, with many fewer ties between users. Now, though, the technological distinction between media made for an audience and media made for a community is evaporating; instead of having one kind of media come in through the TV and another kind come in through the phone, it all comes in over the internet.
University of Florida new media professor Mindy McAdams chimed in:
Newspapers used to be centered in communities. Now they are mostly not. People in much of North America don’t even live in communities.Is this why newspapers are dying? Because there are no communities? …
It’s about what Shirky said: Audiences are not the same as communities, and communities are made up of people talking to one another.
What does a community need? How should journalists supply what communities need? …
This is what Front Porch Forum is all about… helping nearby neighbors stitch together community at the neighborhood level… in every neighborhood in a region. And, as Professor McAdams said above “People in much of North America don’t even live in communities.” And many want to.
Front Porch Forum is in the business of helping neighbors connect and build community within their neighborhood. Some folks ask me “that’s not a business… why didn’t you form FPF as a nonprofit?”
Fair enough. Front Porch Forum is mission driven, like all nonprofits. But it’s also competing in a new and vibrant sector that’s got huge potential and few players currently.
Bill McKibben in his excellent Deep Economy cites work by economist Richard Laynard (in his book Happiness)…
“Both income and companionship have declining marginal returns.” The evidence shows that “increases in income produce large hedonic gains in developing countries… and… negative gains in the United States.”
Community follows precisely the opposite pattern: increased companionship “yields more happiness in individualistic societies, where it is scarce, than in collective societies, where it is abundant.”
Put another way… North America is awash with stuff for people to own/use, but is short on community… so Americans are placing an increasing value on what is in short supply… feeling genuinely connected to the people and community around us. And that’s what Front Porch Forum provides.
TechCrunch reported this week…
Yelp, the popular local review site, will soon announce a new $15 million dollar round of financing led by DAG Ventures. The valuation is rumored to be in the $200 million range. Yelp says that they will be using the money to expand geographically, add onto their sales team, and establish an office in NYC (they are based in San Francisco). This is Yelp’s fourth round of funding since their founding in 2004. Yelp is also boasting some impressive stats: 8.3 million uniques in the past 30 days and over 2.3 million review.
Yelp has become a poster child for how to build a local reviews site and has become a clear favorite of the twenty and thirty-something urban “foodie”.
And Greg Sterling offers…
Yelp’s success is about its “personality” and “transparency.” The site has managed to create a brand as a result of offering content that people have come to value and trust.
This brand identity is what now lifts it above many or most of its competitors.
But it’s the comment area on TechCrunch that starts to get at the most interesting points. E.g.,
Comment No. 12 says in part…
Local interest websites are always non-viral, because they operate in the disjoint “internets” of each metropolitan area. So one needs to wait a very long time before they reach decent size. For Craigslist, it took 7-8 years. VCs will not wait that long. To accelerate this, you can throw money at the distribution/marketing. I do not know what the timescale for them will be in NYC, but VCs may get impatient, especially because this business is very recession-prone, and the recession is coming.
Comment No. 15…
i’m no expert, but $200mm for sub-$10 million revenue, no profits, and difficult to scale growth (building a community in a new metro area takes time and local ad sales takes sales manpower) seems really generous. i guess yelp is essentially the market leader and probably does get high return traffic from those who do use the site… maybe you can argue a decent ltv for each user?
And comment No. 37…
I helped start a review site that was funded at the same time as Yelp, InsiderPages, Judysbook, etc. After building the feature set, we set forth to capture the YP advertising market. Kelsey Group and other industry pundits were playing up the pending “massive” migration of local advertising from offline to online. We all wanted to be there to capture it.
There was one big problem with capturing those ad dollars: the cost of sale. Reaching out to local businesses costs money, a LOT of it. I’m not sure what Yelp’s rate in customer-review-leads-to-advertiser equation looks like, but here’s some back-of-the-envelope math:
2.3 million reviews
Assume average of 1.5 reviews per business location (this is generous)
yields
1.5 million businesses reviewed to dateBreak down those businesses:
60% local, 40% regional or chain (some split along those lines)The ad dollars are in the “national-local” or “regional-local” businesses. They have bigger budgets, and they’re familiar with the web play. But if you’re in the local review business, how many of your users will enjoy ads from Applebees and Home Depot?
So, you go after the “local-local” businesses, because that’s what brings the value of your site (Yelp) over the big guys (Yahoo Local, Google Local). Reaching out to these folks? You have to put feet on the street, and the cost of the sale just doesn’t pencil out.
Because of this, Yelp’s strategy is obvious acquisition. But at those numbers and a fourth round, they need to be eclipsing the {portal-name-here} Local properties in traffic. In short, good luck.
Front Porch Forum is not a local review site (although many of our subscribers do use it for reviews), but many of the points above apply. We launched in our pilot area about 18 months ago and it gets a little easier every day in ways that money can’t buy.
Robert Putnam will speak at the University of Vermont on April 28, 2008, sharing a lecture titled “Civic Engagement in a Diverse and Changing America.”
Putnam’s Bowling Alone was a ground-breaker documenting the decline of many facets of American community life. Steve Yelvington writes about Putnam briefly this week… here.
Rich Gordon writes in more detail about Putnam’s more recent work, part of which Putnam summarizes as “In colloquial language, people living in ethnically diverse settings appear to ‘hunker down’ – that is, to pull in like a turtle.”
UPDATE: Just got the following details…
2008 Mark L. Rosen Memorial Lecture
Robert D. Putnam
‘E Pluribus Unum: Rebuilding Community in a Diverse and Changing America’
Monday, April 28, 7 PM – Free and Open to the Public
Silver Maple Ballroom, Dudley H. Davis Center
Reception immediately following
Co-Sponsored by UVM Political Science Department and the Vermont Humanities Council
Professor Putnam is Peter and Isabel Malkin Professor of Public Policy at Harvard, where he teaches both undergraduate and graduate courses. He has written a dozen books, translated into seventeen languages, including the best-selling Bowling Alone: The Collapse and Revival of American Community, and more recently Better Together: Restoring the American Community, a study of promising new forms of social connectedness. His previous book, Making Democracy Work, was praised by the Economist as “a great work of social science, worthy to rank alongside de Tocqueville, Pareto and Weber.” Both Making Democracy work and Bowling Alone rank high among the most cited publications in the social sciences worldwide in the last several decades.
Some people outside of our pilot area may think that Front Porch Forum provides conventional online message boards for neighborhoods… not so. Here’s an example of a straight-forward web-based threaded message board from a Seattle neighborhood… click here. That’s a different animal.
Andy Sack, founding CEO of now-shuttered Judy’s Book, offers this advice for folks looking to get traction in the “local reviews and word of mouth referrals business”…
i) GET TO CRITICAL MASS
- Do this by limiting geography — stay in one geography for 3 years. Yes, 3 years. Do not expand geography for the first 36 months. Every successful online local business has been in one geography for 3 years.
- Do this by limiting the number of categories or professions you’re trying to get word of mouth on. Do not try and do the entire yellow pages. Choose at most five categories. I might suggest: restaurants, dentists, doctors, auto mechanics, and real estate.
- Do this by aggressive customer acquisition. Whatever your strategy for customer acquisition, get aggressive about. Do not sit in an ivory tower and expect to get to critical mass.
- Aggregate content from other places on the web so you can avoid the empty database problem
- Spend as little money as possible
ii) Go back to step i
VC Fred Wilson wrote this week about his Outside.in and Everyblock.com. The comments are interesting too. Fred wrote…
Techcrunch calls outside.in a competitor of EveryBlock. I think collaborator is more like it. It’s going to take more than one company to rebuild the local newspaper from the ground up.
Amen. Front Porch Forum is very different from either of these efforts, but plays in the same space. With 30% of our pilot city subscribing and a large percentage posting, we’re definitely well beyond just the heavy web users that dominate much of Web 2.0.
Ghost of Midnight is an online journal about fostering community within neighborhoods, with a special focus on Front Porch Forum (FPF). My wife, Valerie, and I founded FPF in 2006... read more