Category Archives: Free Ideas

Idea: Game Mechanics for Businesses

ICA 2010 Conference Poster - Leveling Up Stude...
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In my last post I talked about how I would openly share some of my ideas. This is one of those half-baked ideas and like all of my ideas, it was cobbled together from a number of conversations I’ve had with a number of people.

Over the past year and in very infrequent intervals, I’ve been thinking about how a system could be created that would incent people to do things with non-monetary incentives, while at the same time, surfacing the creativity out of people all within a corporate setting. I’ve been thinking about how cool it would be if you could create a system that fundamentally changed the way corporate america works. A system that could change the internal processes, the reward systems, the compensations and the bonuses of business cultures, that from what I hear, simply suck. And I’m interested to see if this can all be done using game mechanics.

It’s been proven already that people do things when they feel a sense of reward and “sense” doesn’t necessarily mean dollars. Just look at all the people starting projects or donating to projects on Kickstarter. Look at all the people freely answering questions on Quora or StackOverflow. Look at all the people that build, and spend money on, ridiculous virtual items to build virtual farms in Farmville.

A common theme here is the use of non-monetary rewards systems. Game mechanics to influence a certain behavior.

So my thinking is, why can’t this same approach be used to influence certain behaviors in the corporate setting? Freeing the minds from the cubes and adding a healthy dynamic to the work at hand. Extracting the creativity and entrepreneurship out of everyone using some new rewards system. A new type of integrated consulting.

Am I on to something or should I go play Farmville?

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Monetizing YouTube and the Viral Effect

We used to live in what I will call a Media Dictatorship. A Media Dictatorship is a world where content is created by a few dictators (media companies), and as a result, those few dictators are able to charge a premium to advertisers for access to the eyeballs and ears of the people watching that premium content. This process is called television, radio, print, magazines, and newspapers. Think about the Super Bowl and Super Bowl commercials for a second. One night a year, content providers or dictators (the cable network hosting the Super Bowl) know that they will have an entire country watching their show, and as a result, they are able to charge a fortune to advertisers for a 30 second commercial. According to the Associated Press, a 30 second spot for the 2008 Super Bowl was $2.7M dollars. On this night, everyone knows that millions of eyeballs and ears will be tuned in, and so, advertisers are willing to shell out some big bucks for the opportunity to reach all of those viewers (according to a Nielsen report, there were 97.5M viewers of the 2008 Super Bowl). In this world, the world of a Media Dictatorship, the dictators own the distribution of the content, and therefore they own your attention.

Today we live in a very different world. A world that I will call a Media Democracy. A Media Democracy is a world where content is created by anyone, and as a result, those people are able to charge whatever they would like. However in this world, in this Media Democracy, the people that own the distribution do not force their content on the people (see Google). These distribution owners let the people choose what they watch or listen to and as a result, attention isn’t owned but earned. In order to accrue lots of eyeballs and ears, the content must be compelling and the people must be willing to share. And unless there are lots of eyeballs, it is very difficult for the people to charge advertisers anything at all. Consider that YouTube video that you loved, but only has about 100 views. Although the content may be awesome, 100 views is of little significance to big brand advertisers. Now consider that YouTube video that your friend told you about. The video that you would of never heard of had that friend not said anything to you. Turns out, this video has 100M views. Guess who made money off of this video? No one. There was no $2.7M commercial for 30 seconds. The video itself was only 55 seconds, and yet for 55 seconds, this video had the attention of almost 100M viewers.  This was a mini Super Bowl event that happened organically, grew virally, and was controlled by no one. A true democracy.

Welcome to the new age of the internet. Open, distributed, democratized. More specifically, welcome to YouTube. At any given point in time a video could experience a Super Bowl-like event or what I rather refer to as a Black Swan event.

There has been a lot of talk recently on how to make money from YouTube videos or User Generated Content (UGC) videos, especially after seeing YouTube’s inability to make money off of the recent pop sensation Susan Boyle.

As Simon Cowell might say, this story is utterly disappointing and self-indulgent. But the fact that YouTube and ITV have been unable to monetize the Internet sensation that is Susan Boyle is a rather significant blunder, and highlights some of the archaic ways that business is still done between old and new media. – Mashable, Susan Boyle Video Profits: $0

In the Media Dictatorship, media companies know with good certainty how many viewers they have. In the Media Democracy world, no one knows with any certainty how many viewers there will be. In lies the monetization and advertising dilemma with UGC videos or anything viral online. How do you make money off of videos that MIGHT be huge successes? How could an advertiser possibly know what videos are going to be a hit and go “viral”?

Bottom line: They can’t.

So now what? We know there is a ton of potential in videos that have millions of views, but the question still remains:

In a broad sense: How can advertisers capitalize on media that goes viral?
Solution: Selling dynamic advertising access based on first order traffic derivatives.

In a specific sense: How can advertisers capitalize on viral YouTube videos?
Solution: Selling dynamic advertising in YouTube videos based on the growth rates of video views.

Imagine for a second that an advertiser has the ability to place an advertisement (overlay, video ad, pop up, etc) in a YouTube video at any given point in time during the life of that video. For all intents and purposes, an advertiser can throw an ad in a video, however they want, whenever they want.

  1. Would the advertiser place the ad at the beginning life cycle of the video? Do they try and intuitively gauge how successful the video might be? Would you put up $3M on a video that may or may not be seen by more than 100 people?
  2. Would the advertiser place the ad at the end of the video’s life cycle? After the video has been seen 100M times? Would you put up $3M on a video that may or may not have peaked in popularity?

The answer is no in both examples.

The real solution here is to place that $3M on videos that:

  1. Meet the advertisers target audience (the type of video: comedy, horror, sports, etc)
  2. KEY: Have the highest growth rates for a certain period of time.

By inserting advertisements into videos that are experiencing the highest growth rates, marketers could benefit from the “viral” effect of videos. The $3M would only be spent as the video increases in popularity. The video will no longer be judged based on “top rated” or “most viewed”, but instead, will be judged and purchased by marketers based on “most growth” (The interface might look something like the image below).

Ultimately, if marketers are to capitalize on the “viral” effect they must start to look at the viral aspects of media or videos, and buy them according to their growth or “viral” potential as the growth is happening.

growthratemockup

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Become Rich: Made in China. As Seen on TV.

Mike Strutter in his infomercial for "Str...
Image via Wikipedia

We’ve all had these moments:

“Hey, Wouldn’t it be cool if we made….”

“I’ve got a really great idea. We should make…”

“Dude, This is genius. We are going to make….”

If you’ve recently had one of those light bulb, Velcro, post-it note, window in envelope idea moments, now is the time to make it and sell it.

Here’s how:

  1. MADE IN CHINA – Go create an account at alibaba.com and find a Chinese manufacturer that can make your “whatever it is” idea for cheap.
  2. INFOMERCIALS - Take your product to TV using infomercials.

With the economy still somewhat in free fall, advertisers are cutting back on marketing budgets especially in mediums like print and television. Networks are having hard times filling premium commercial slots with premium commercials, so instead, they turn to infomercials which are mostly direct response advertisements.

From CNN Money:

McAlister and other direct marketers hope to prosper through the downturn. With top-tier marketing firms slashing their ad budgets, competition for airtime has steadily declined, making room for a new class of advertisers. Infomercials were once relegated to the wee hours of the morning, when slots come cheap. Now they’re turning up in prime time, even squeaking onto the Super Bowl telecast: Cash4Gold, a direct advertiser that melts down jewelry, made headlines in January by snapping up an unsold 30-second slot.

Chances are good that a person calling one of those cheesy infomercials, are most likely going to buy the product. Why else would they pick up the phone in the first place?

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The University of Nothing

I’m founding a school called the University of Nothing.

This is a school that teaches no subject matter directly. Instead, this university will teach you how to learn, and while learning how to learn, you will indirectly learn something else.

My past 4 years in college, I’ve learned by a process that I will call cram-sorption learning. Information is given to you (for the most part) and it’s up to you to learn it (or cram for it) and spit it back on tests. The reality is, after that test is over, many people forget everything they’ve just learned.

Students and schools today should learn through a process which I will call discovery learning. A process by which no information is given, except for an overall goal or objective. In this model, students will be required to do whatever is necessary to find, learn, and complete the task. Accessible Information has become so huge, widespread, and abundant, that I could learn anything I wanted to if I just knew how to look and if I applied a different way of thinking.

If this is successful, my students of the University of Nothing will be prepared to prepare themselves for any job or new career no matter what the situation.

Applications available soon…

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My version of IBM’s new supercomputing initiative

IBM has recently announced “a next-generation version of its Cell processor, the first specifically geared for computer servers.”

The PowerXCell 8i will drive the Road Runner system now under test at Los Alamos National Labs to see if it can become the world’s first supercomputer to deliver sustained petaflops performance. Besides cracking the petaflops barrier, IBM hopes hundreds of users will decide to plug into their IBM servers a two-socket board housing the new Cell chips to deliver what IBM calls “supercomputing for the masses.”

Instead of servers being plugged into a grid, why not use PCs and gaming consoles?

I find this announcement to be kind of ironic since it was IBM that realized open source (the Apache Web Server) is more valuable than a centralized and closed platform, even if is somewhat open.

If I was IBM, here is what I would do.

The idea: Mixing different kinds of computers into a supercomputing grid to create an infinitely scalable supercomputer for enterprise solutions. Just as SETI and Stanford have created new hybrids of supercomputers for astrological data analyzation and Computational Earth and Environmental Science research respectively, a similar supercomputing hybrid model has yet to be adopted for commercialized use. This idea will allow users to submit their PCs or gaming consoles to the supercomputing grid, where they can be accessed whenever they are not being used, and will contribute to a commercially available supercomputer. By participating in this supercomputing grid, donations will be made to charities on the users’ behalf. These donations will depend on the amount of data processes computed on their machines. On the other end of the business, enterprises will be able to rent, lease, or even purchase data processing bandwidth. This will enable startups, small to medium businesses, and large businesses, to acquire computationally intensive processing power with extremely fast clock cycles which could easily deliver sustained petaflops performance and beyond. This would be the first ever cluster of machines available for commercialized use providing for cheap energy costs and cheap hardware costs. By participating in this grid, users will be members of ongoing charitable donations, and businesses will, for the first time ever, have paralleled computing power to the likes of SETI and Stanford. PCs were once thought of “business or research only”. Today, virtually everyone owns a PC. Supercomputers today are only thought of as “research-only”. This put supercomputers in the commercialized or “business” realm. IBM has just announced a new initiative to delver a supercomputer to the masses, as they predict an $8-$10 Billion market. Instead of creating a centralized supercomputer for the masses, this idea will create a decentralized supercomputer to the masses, that will exceed any one supercomputer.

That is what I would do.