by Dana Blankenhorn
  Volume IX, No. XXIII

This Week's Clue: Deep Commerce

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This Week's Clue: Deep Commerce
SSP (Shameless Self Promotion)
Best of the Week
The American Diaspora
ZDNet Open Source
Clued-in, Clueless

Dana Recommends The Blankenhorn Effect offers a powerful, positive message for our time. Once you understand how Moore's Law impacts every part of your life, how powerful it is, and how irresistible a force it truly is, you will have the power to predict the future and know how to change it. Buy it today, and make 2004 a better year for yourself, your business, and your family.


For the Week of June 6, 2005

The reason why publishers have no editorial budgets with the move to the Web is simple.

None engage in Deep Commerce. Instead, they still just sell ads.

What is Deep Commerce? It's doing everything you can to drive sales for your commercial partners. Back in the day it meant performing research on your subscriber list, sharing the results and insights with advertisers.

Today it should mean much more. That should start with an attitude and a promise to your prospective partners. You will see new sales directly attributable to my efforts, and you will pay me based on those sales.

I'm not talking clickthroughs here. I'm talking sales. The sad fact is that 99% of American businesses are still not enabled for e-commerce, and most of those that are have a half-assed way of doing it.

Most stores think a Web site makes them fully commerce-enabled. It doesn't. It means they have a cash register. Commerce is a process that makes the cash register ring.

Commerce-enabling a merchant can be as simple as creatively using e-mail. Let me give you an example. Down the street from me is a small shoe store, run by a man who offers personal advice to all his customers. So make him your "Dr. Shoe." Make him the sponsor of your site's sports coverage. Put question marks there saying "Ask Dr. Shoe."

When someone clicks a question mark they get an e-mail window with a tracked address, like this: Note that in this case Dr. Shoe doesn't need a Web site, and they don't necessarily need their own e-mail box. The example shows them coming to a box created on my Web site. The data after the question mark should be different for every ad, every day, so the e-mail (and prospect) can be tracked.

Now, when the e-mail comes in I call Dr. Shoe, get an answer to the question over the phone, and in my response to the e-mail make some suggestions. Could they give us some contact information? Could they come over and reference this conversation? Now you've created a customer, you've taken them down the sales funnel and built a trusting relationship with this merchant.

How much do you think this new relationship is worth to Dr. Shoe? Negotiate a way to be paid on that basis. Don't sell ads. Sell results.

Every store is different, and every solution will be different.

Some stores have big inventory and may promise to beat anyone's price on a specific product or model. In this case you aim your pitch so that e-mails go to that merchant asking about specific products - is it in stock, and what does it cost? You link to a form that's easy to fill out, customized for the kind of question elicited by the online ad. That contact has now brought someone far down the sales funnel, and that's worth a lot more to the merchant than an ad.

In order for this to work, of course, you must have content that will attract people who are likely to buy shoes, or the other products of your merchant partners. It's in building such content that we find the genius of publishing. But at least now we're talking about defining audiences, targeting audiences, aiming content at their needs. In terms of the publishing business, we're back on level ground.

To serve someone like Dr. Shoe, your content must not only be narrowly targeted in terms of its interests, but it must be targeted geographically. You are not going to turn Dr. Shoe into a worldwide character. You're going to help him sell shoes in his store.

Every merchant you meet has a different set of requirements in order to be commerce-enabled. Pizza stands may use a system that turns an e-mail into a phone call and, if the clicker has it, a VOIP call. (Add some distinctive ringing or other tones to the front of the call so the pizza man knows that it's your ad that generated the sale.) Insurance agents could set appointments for personal visits from shoppers online.

The real big money in the local Web exists for what I've called pitch permissions, test drives on cars and appointments to either see houses or have someone come out to list your house. The value of this pitch permission is high, so you want to build a process that creates an adequate level of intimacy first, a give-and-take you can help these merchant partners manage.

Some 99% of online sales are being lost by car dealers today because they don't know how to deal with online responses. Help them do that. Train them. Do the pre-qualification work yourself. You will be earning the dealer money and becoming their commerce partner. A real estate listing can be worth thousands of dollars to the agent who gets it. If you're helping them get it, each one of those listings could be worth hundreds of dollars to you.

What does this have to do with content? Everything. Publishers create content in order to create and define audiences who will support their advertisers. You're doing the same thing, only you're not talking here about advertisers, but commerce partners. And you're not necessarily talking about content, either, but conversations.

Can this model work? It's proven to work in politics. Political Web sites have directed literally millions of dollars to favored candidates and causes. They are a good model for what you're trying to do on the editorial side, create compelling conversations that build loyalty, and make those people likely to support those partners you bring to them.

This also means you need to be very careful in your choice of commerce partners. You want to follow up with your audience on their satisfaction with those partners, and be honest with your commerce partners in passing along that feedback, and helping them improve their process for handling customers.

Gee, you say. That sounds very deep. That doesn't sound like publishing at all.

It's not. Not in the way we think of publishing a print product, not in the way we think of creating broadcast products. But we're not doing either of those things. We're creating a Web product. We're using the Web to create intimate relationships, and turning those relationships into cash for our commerce partners.

That's Deep Commerce.


Shameless Self-Promotion

I'm now helping to produce a special blog on Open Source for ZDNet.

I work as a freelance writer in Atlanta, and am on the development team for EgoScout, a new kind of mediator for mobile phone users.

My last non-fiction book, "The Blankenhorn Effect" won the Computer/Internet category in the 2003 Independent Publisher (IPPY) awards. Write me for a PDF copy of my latest novel, "Baptists are for Dunking."

On my Mooreslore blog I've written a new novel, "The Chinese Century." It's a story told in real-time, with real characters, but entirely fictional, dealing with the consequences of the falling dollar. I'm beginning a sequal, "American Diaspora," exploring the themes of the first book but with more fictional characters. It's a true alternate history, but set in the present day.

You are encouraged to forward this newsletter widely. And if you have trouble subscribing let me know. Remember: it's journalism that keeps the Clues coming...


Best of the Week

The Real Open Source Challenge is Getting Paid

I've been a professional writer for over 25 years now. And what is most striking about the last few years, besides the rise of open source and blogging, is the rise of forced amateurism.

Von Neumann's Science Lesson

Von Neumann made major contributions to quantum mechanics, he practically invented game theory, but what got him on the stamp was his "invention" of "modern computer design." It's now obsolete.

One for the Web?

The European Constitution's impending failure in France is being credited to the Web.

A Predation Story

It's natural that we don't want our oldsters or little kids eaten by wolves (which was a major theme of the old fairy tales). So in most of the civilized world we've removed predators from the scene.

Always On Political Roadblock

I'm convinced the hurdles facing Always On applications aren't technical, and aren't artifacts of the market. They're political.

The Way of Hollywood is Madness

When will we get effective political pushback against Hollywood's absolutism on copyright? I once thought it would happen when people were jailed for linking. I was wrong.

Doctors In the Land of Lud

Are you an American in e-mail contact with your doctor? No? I didn't think so.

The Fog of Blogs

Often the very thing you criticize others for is your own blind spot. This was never more true than in Nick Kristof's piece called Death by a Thousand Blogs.


Getting into a second Vietnam is bad enough. But that's just one of three terrible fates facing the U.S. today.

The News Cartel

Most local newspapers don't have RSS feeds. They don't want their content "syndicated" on the Web. They want people to buy the paper or go through their home page. In larger towns registration requirements are added, firewalls aimed at keeping content in.

No BP or Morgan Stanley Ads Here

Decisions by BP and Morgan Stanley requiring prior restraint on any publication where they advertise represent great news for the blogosphere.

Et Tu, Frodo?

After posting this I learned the spam database I'm about to describe is not necessary for Mailwasher to work. My complaint here is solely regarding issues of marketing and notice.

The Frist Rule

The filibuster, as we knew it, is dead. Who should we thank for this? Why, Dr. Bill Frist, M.D.

Whatever Happened to that Jobs Kid?

The fact is that progress happens when ideas are tested, and stops when ideas are rejected.

The Right Blogging Business Model

The community business model would work better. This is driven, not so much by what bloggers want to say as what their readers want to say.

File Hoarders Get BitTorrent Win

BitTorrent -- now trackerless! Good news (at least in the short term) for file hoarders.


The American Diaspora


Table of Contents

ZDNet Open Source

Linux is now a Mobile Player

What Linux Really Means for India is Localization

Is Service the Answer to Open Source War ?

If OSDL is the Center of Gravity, How Should it Act?


Clued-in, Clueless

Clued-in is AMD. If Intel loses its market dominance, that dominance is going to a good outfit.

Clueless is Sony's "bait-and-switch" effort at forcing copy protection onto US CDs without disclosing that fact to buyers beforehand.


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